Emotional Intelligence in Financial Planning

Emotional Intelligence in Financial Planning

Dr. Andree C. Swanson, EdD, MHR, MAOMForbes College of Business at Ashford University

Randy Braidfoot, MS, CFP®, CDFA™,MPASSM

Director of the Dispute Resolution Center, a department of the

Panhandle Regional Planning Commission

2014 Eleventh Annual Institute For Emotional

IntelligenceMcClellan Community

CollegeWaco, TXFeb 2014

Background

How we met

Brainstorming

ideas

Starting from

scratch

Abstract

The Code of Ethics and Professional

Responsibility of the Certified Financial

Planner Board of Standards sets forth

three principles that clearly identify the

requirement to possess or obtain a high

level of emotional intelligence.

Abstract (Continued)

Researchers sought to discern if there

was a need among CERTIFIED FINANCIAL

PLANNER™ practitioners for a better

understanding of emotional intelligence

so they could better fulfill the

requirements of the Code requirements.

Abstract (Continued)

The outcome of the research

demonstrated that there is a need

for emotional intelligence training.

Emotional Intelligence Defined

The capacity to…

perceive emotions,

assimilate emotion-related feelings,

understand the information of those

emotions

manage them (Mayer et al., 1999)

Introduction

Introduction

The CERTIFIED FINANCIAL PLANNER™ designation is recognized as the “Gold Standard” of the financial planning industry when it comes to being a competent planner.

Introduction (Continued)

Within the Code of Ethics and Professional

Responsibility of the Certified Financial Planner

Board of Standards, high principles are

established to maintain the professionalism

and integrity of the certification marks (CFPBS,

2013).

Introduction (Continued)

Within three of the seven principles

of the Code are indications that

suggest practitioners possess or

obtain a high level of emotional

intelligence to meet the Code

requirements (CFPBS, 2013).

Significance of Study

Significance

The significance of this study relates directly back to the Code of Ethics and Professional Responsibility of the Certified Financial Planner Board of Standards, Inc.

Competence includes: the wisdom to recognize the limitations of

that knowledge referring to another professional when

necessary.

Significance

Many studies have been published on

how individuals with high emotional

intelligence can enhance and increase

the potential for positive outcomes.

Significance

The completion of this study could benefit the

field of financial planning and in a greater

sense may significantly change the landscape

of communications and relationships in both

business and academia as a whole.

Connection to Financial Planning and Academia

Research MethodologySurveyMonkey

Survey Methodology

Conducted a pilot

study

Conducted a

survey

Used Survey

Monkey

Analyzed results

Published data

Survey Results

Participants / Demographics

Surveyed 36

Certified Financial

Planners

Feb 2013

23 males

12 females

▪ 1 skipped this

question

Years in the CFP Field

1 - 3 years = 3

4 – 9 years =

12

10 – 14 years

= 7

15 – 19 years

= 5

20 or over = 8

(Swanson & Braidfoot, 2013, p. 4)

Number of CFPs who have heard of EI

24 of 36 (66.7%)

had heard of

emotional

intelligence

12 (33.0%) had a

clear

understanding of

the meaning of

emotional

intelligence.(Swanson & Braidfoot, 2013, p. 4)

CFPs who have a clear understanding of EI

14 (38.9%) strongly agreed or agreed

9 (25.0%) participants strongly disagreed or disagreed that they understood emotional intelligence.

15 (41.7%) participants were neutral.


Believe EI will be useful

29 (80.6%) strongly agree or agreed that EI would be useful in their work as a financial planner.

The blue and orange section depict those that strongly agree (orange) and agree (blue).


Believe EI will improve their performance

30 (83.4%) of the 36 participants strongly agree or agreed that EI would improve their performance.

The blue and orange section depict those that strongly agree (orange) and agree (blue).


CFP Board of Ethics states Principle 2 – Objectivity

“Provide professional services objectively” Principle 3 – Competence

“Maintain the knowledge and skill necessary to provide professional services competently”

Principle 4 – Fairness “Be fair and reasonable in all professional

relationships. Disclose conflicts of interest”

(Swanson & Braidfoot, 2013, pp. 1 -2)

The bottom-line

Based on the CFP Board of Ethics statements on the previous slide

and The results of the survey show that…

CFPs are aware of Emotional Intelligence (EI)

CFPs understand that learning more about EI will benefit them

A need exists to implement EI training in the field of financial

planning.

Future Research

http://www.uws.edu.au/bioelectronics_neuroscience/bens/postgraduate

Future Research

Investigate the

appropriate level of

emotional

intelligence needed

to become a better

Certified Financial

Planner™ practitioner.


Future Research

Conduct a qualitative

Delphi study to assess,

through the use of

expert CFPs (identified

in this study), the

appropriate levels of

training required in

emotional intelligence. (Swanson & Braidfoot, 2013, p. 8)

Future Research

Seek permission from the Certified Financial Board to use their membership as a resource

Apply this to other countries


Concluding Research

http://www.forskningsradet.no/servlet/Satellite?c=Nyhet&pagename=nanomat%2FHovedsidemal&cid=1253969771853

Conclusion

97% experienced a situation with an emotional distraught client.

75% desire Emotional Intelligence as part of a continuing education program.

Over 85% positive response was received to the question on establishing Emotional Intelligence as part of the primary curriculum for financial planners.


Conclusion (Continued)

The results of this survey strongly

indicate that further study and

training for financial planners is not

only warranted but may be

considered essential in the

framework of being a competent

planner.


Questions from the Audience

BiographiesDr. Andree Swanson and Randy Braidfoot

Dr Andree Swanson

Andree Swanson is an assistant professor with the Forbes

School of Business at Ashford University (Denver, Colorado)

and adjunct associate professor with the College for

Financial Planning (Greenwood Village, Colorado).

Dr. Swanson holds a Doctorate in educational leadership

and a Master of Arts in organizational management from

the University of Phoenix.

She also holds a Master of Human Relations from the

University of Oklahoma where she first learned of emotional

intelligence. Her work experience ranges from office

management to corporate training to higher education.

She has worked for the US government (DoD, USAF, & USA),

corporations, and higher education.

Randy Braidfoot

Randy Braidfoot is a securities principal and CFP® practitioner with

over 26 years of experience. He holds a Master of Science in personal

financial planning from the College for Financial Planning and a

Bachelor of Arts in mass communications from West Texas A&M

University.

Randy also holds the Certified Divorce Financial Analyst designation.

Braidfoot is considered a “subject matter expert” for the Certified

Financial Planner Board of Standards where he reviews and creates test

questions that are used on the certification test. He is the Director of

the Dispute Resolution Center, a department of the Panhandle Regional

Planning Commission, providing mediation services for the judiciary

courts of the top 16 Texas counties .

In 2011, he was honored as the Mediator of the Year. He has also

trained and worked as a mediator for the Texas Department of Criminal

Justice and as a financial specialist in collaborative law cases.

References

References

Certified Financial Planner Board of Standards Inc (CFPBS). (2013). Code of Ethics and Professional Responsibility. Certified Financial Planner Board of Standards Inc. Retrieve from http://www.cfp.net/learn/codeofethics.asp

Swanson, A., & Braidfoot, R. (2013). An Assessment of Emotional Intelligence Understanding in the Field of Financial Planning. Internet session presented at the 2013 Summer Global Conference on Business and Finance (GCBF), Costa Rica.

http://www.cfp.net/learn/codeofethics.asp

http://www.cfp.net/learn/codeofethics.asp

Other publications

Braidfoot, R., & Swanson, A. (2013, Jan). Emotional intelligence of financial planners in mediation. Global Conference on Business and Finance Proceedings, 8(1), 378-385. Retrieved January 5, 2013 from http://www.theibfr.com/proceedings.htm

Braidfoot, R. B., & Swanson, A. C. (2013, Jan). Emotional intelligence of financial planners in mediation. Internet session presented at the 2013 Winter Global Conference on Business and Finance (GCBF), Las Vegas, NV

Braidfoot, R., & Swanson, A. (2012, Sep). White Paper -- Emotional Intelligence of Financial Planners. College for Financial Planning, Greenwood Village, CO. http://www.cffpinfo.com/eBooks/Emot_Int.pdf

http://www.theibfr.com/proceedings.htm

http://www.theibfr.com/proceedings.htm

Emotional Intelligence in Financial Planning

Education

Transcript of Emotional Intelligence in Financial Planning