2005 Survey of Trends
                        in the Financial
                       Planning Industry

                 ...
2005 SOT – About the Survey
  1. The objective of the study was to develop a Planner
     Profile, an understanding of the...
2005 SOT – Planner Profile
  Planner Age Range



                     Age     2002    2003      2004         Age         ...
2005 SOT – Planner Profile
  Planner Years in Financial Services Industry



               Years              2002   2003...
2005 SOT – Planner Profile
  Industry Affiliation

              90%
                            82%
              80%

  ...
2005 SOT – Planner Profile
  Licenses and Designations

              50%

              45%      43%

              40%

...
2005 SOT – Planner Profile
  Planner Earnings
                                                              2002          ...
2005 SOT – Planner Profile
  Planner Method of Earnings



                Method                  2002       2003    2004...
2005 SOT – Planner Profile
  Planner Career Satisfaction

              4.00              3.82
                           ...
2005 SOT – Planner Practice

  1. Plans prepared during last 12 months:
      •   67.3% of advisors reported preparing 1 t...
2005 SOT – Planner Practice
  Types of Single Focus Plans Prepared in Past 12 Months

               4.00            3.91
...
2005 SOT – Typical Client Profile

  Planner Typical Client



                                               2002        ...
2005 SOT – Typical Client Profile

  Client Financial Concerns

              4



                         3.21
         ...
2005 Survey of Trends
                        in the Financial
                       Planning Industry
                  ...
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  1. 1. 2005 Survey of Trends in the Financial Planning Industry Dirk Pantone, CPA, CSA VP Business Development FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  2. 2. 2005 SOT – About the Survey 1. The objective of the study was to develop a Planner Profile, an understanding of the Planner Practice and the Typical Client Profile. 2. Compares information from 2002, 2003, and 2004 with 2005 data. 3. Of interest to corporations and individuals looking for benchmarks against which to compare themselves, their clients, and their futures. FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  3. 3. 2005 SOT – Planner Profile Planner Age Range Age 2002 2003 2004 Age 2005 < 35 years 3.7% 9% 1.5% 21–29 years 3.9% 35–44 years 18.8% 22.6% 14.5% 30–39 years 22.3% 45–54 years 44.1% 37.8% 47% 40–49 years 27.3% 55–64 years 24.9% 26.6% 29.2% 50–59 years 32.7% > 64 years 8.6% 4% 8.5% 60–69 years 13.2% 70+ years .5% FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  4. 4. 2005 SOT – Planner Profile Planner Years in Financial Services Industry Years 2002 2003 2004 Years 2005 1–4 years 2% 5% 1.5% 1–4 years 9.9% 5–8 years 6% 14% 3% 5–9 years 20.6% 9–12 years 13% 23% 12.6% 10–14 years 15.6% 13 or more years 79% 58% 82.9% 15–19 years 20.6% 20–24 years 19% 25–29 years 9.6% 30+ years 4.4% FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  5. 5. 2005 SOT – Planner Profile Industry Affiliation 90% 82% 80% 70% 60% 50% 44% 40% 29% 30% 24% 20% 12% 10% 5% 1% 1% 0% 0% Financial Investment Securities Insurance Accounting/ Banking Real Estate Other Financial Other Non- Planning Planning Tax Planning Financial 2002 2003 2004 2005 FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  6. 6. 2005 SOT – Planner Profile Licenses and Designations 50% 45% 43% 40% 35% 30% 27% 25% 20% 15% 15% 14% 12% 10% 5% 4% 3% 3% 2% 2% 2% 1% 1% 1% 1% 0% Life & NASD ChFC CLU CPA Law EA CFA AAMS CMFC CIMA CRPC RHU CPCU CRPS Hlth 2002 2003 2004 2005 FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  7. 7. 2005 SOT – Planner Profile Planner Earnings 2002 2003 2004 2005 Gross in year preceding earning $60,000 $52,000 $54,000 $87,700 CFP certification Gross in year after earning $100,000 $90,000 $72,000 $107,400 CFP certification Current Annual Gross $200,000 $140,000 $219,000 $277,800 Current Annual Net $120,000 $95,000 $142,000 $153,500 Years Gross Earnings Net Earnings Less than 1 year $95,964 $69,900 1–4 years $125,833 $79,656 5–9 years $311,824 $173,467 10–14 years $325,793 $163,226 15–19 years $425,162 $233,362 20–24 years $517,186 $264,600 25–29 years $462,500 $265,000 30+ years N/A* N/A* FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  8. 8. 2005 SOT – Planner Profile Planner Method of Earnings Method 2002 2003 2004 2005 Fee and commission 57% 61% 54% 56% Fee only 26% 22% 29% 34% Commission only 11% 7% 11% 4% Salary only 5% 7% 4% 3% Salary and fee* N/A N/A N/A 2% Salary and commission 1% 3% 1% 1% FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  9. 9. 2005 SOT – Planner Profile Planner Career Satisfaction 4.00 3.82 3.65 3.56 3.54 3.50 3.07 3.00 2.86 2.73 2.43 2.50 2.00 1.50 1.00 0.50 0.00 Helping clients Challenge of Being an Interacting Competitive Level of New business/ Professional improve their solving client entrepreneur with clients nature of income prospecting liability lives problems business 2002 2003 2004 2005 FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  10. 10. 2005 SOT – Planner Practice 1. Plans prepared during last 12 months: • 67.3% of advisors reported preparing 1 to 19 single focus plans. • 62.7% of advisors also reported preparing 1 to 19 comprehensive plans. 2. Rates charged during last 12 months: • $100 - $199 ~ Hourly Rate Charged (50%) • Less than $100 – Single-Focus Plan (23%) • Less than $1,000 – Comprehensive Plan (35%) FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  11. 11. 2005 SOT – Planner Practice Types of Single Focus Plans Prepared in Past 12 Months 4.00 3.91 3.26 3.06 3.01 3.00 2.88 2.75 2.00 1.00 Investments College education Tax Estate Elder care Insurance funding 2002 2003 2004 2005 FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  12. 12. 2005 SOT – Typical Client Profile Planner Typical Client 2002 2003 2004 2005 Age 55* 55* 54* 55–64 Type Two-income One-income Two-income Two-income couple family couple couple Annual Gross Income $100,000 $100,000 $100,000 $100,000– $149,000 Annual Discretionary Income $15,000 $20,000 $20,000 $10,000– $19,999 Working with Planner (mean) 8½ years 7 years 8 years 8 years FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  13. 13. 2005 SOT – Typical Client Profile Client Financial Concerns 4 3.21 3.13 3.13 2.99 3 2.79 2.78 2.39 2.31 2.15 2 1.91 1 0 Retirement Health care Investment/ Tax Outliving Managing Estate Funding Amount of Potential for funding costs assets growth burden assets money planning education personal debt job loss/ costs downsizing 2002 2003 2004 2005 FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT
  14. 14. 2005 Survey of Trends in the Financial Planning Industry (Copy Available for All Attendees) Questions? FINANCIAL PLANNING ASSET MANAGEMENT RETIREMENT PLANNING WEALTH MANAGEMENT

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