Several of you have contacted us as a result of the recent media attention regarding my status with the CFP (Certified Financial Planner) Board of Standards. This letter is to give you a little background and clarify the situation.
First of all, please be assured that I am not changing anything about the way KFG serves clients. We do not sell any financial products or receive any commissions. We will not do so in the future. Clients pay fees for our advice and financial planning services, and that will not change.
Because we are paid by you, our clients, we have a fiduciary relationship with you that requires us always to put your interests first. Our investment advice and all other services are based on what is best for you, because you are clients who pay us directly, not customers that we sell products to. For KFG, this fiduciary relationship is a matter of integrity and professionalism, and it is fundamental to our identify as a financial planning firm.
Here is some brief background on my current situation with the CFP Board. As you know, I used to sell real estate. My brother and I each own half of the real estate firm founded by our father. I am not involved in the management of the business, and I do not currently receive any income from it in the form of salary, dividends, or commissions. I can receive a dividend. The company rarely pays one, however, and we have had only one in 20 years. I do still hold a real estate license and could legally sell real estate and receive commissions, which I have not done for the past decade.
The CFP Board has told me that, because of my partial ownership of the real estate firm, I need to describe my financial planning practice as “fee and commission” instead of “fee-only.” “Fee and commission” does not accurately describe my practice, which has always been fee-only and will continue to be fee-only.
If you want more background, here are links to two of my blog posts from October 14 and October 21, 2013. A couple of current news articles, one by Michael Kitces on his Nerd’s Eye View financial blog and another by Ann Marsh in Financial Planning magazine, also may be of interest.
I’m continuing to negotiate with the CFP Board. I hope, over the next few months, we can resolve this situation in a way that will allow me to keep the CFP designation. If that isn’t possible, I may choose to give up the designation. Doing so would not affect my licensing, my status with the SEC, or KFG’s fiduciary relationship with clients. This firm has never sold financial products or received commissions for financial services, and we will not do so in the future.