It's the destiny of our profession to create a world where every investor can thrive and prosper. To make that happen, we need to take a hard look in the mirror and appreciate the importance of being clear with our words, recognizing that our own internally crafted jargon may be misleading to the people we seek to serve. The public wants to hire financial planners who can visibly showcase an ongoing commitment to their words and promises. A planner's method of compensation is a non-issue when clients believe their interests are being placed first and that the advice they receive is both sincere and trustworthy.

SAVVY CLIENTS

Today's prospects are more adept at identifying individuals who truly deliver financial planning. They are likely coming to your office prepared with interview questions. They have Googled not just your firm, but the names of "your people." They have visited your website and they want to find references who have worked with you in the past. Simply put, they seek to understand how you build lifelong planning relationships and how you live up to every word on your website and collateral material.

Think about this: After your clients tend to the health of themselves and their family, is there anything more important to them than addressing their financial welfare as it relates to the exploration, fulfillment and management of their unique goals and objectives? The best financial planners help them do this successfully.

The largest financial institutions and service providers have successfully built marketing campaigns that focus on the emotional impact of financial planning issues. These firms are spending millions of dollars to build campaigns that help the public capture the emotional understanding of what financial planning means. It's the translation of the message into reality that becomes problematic.

MORE INFIGHTING

Just as the public is starting to get it, we, as members of our own profession, continue to battle, bicker and point fingers at one another. Lines are being drawn between registered investment advisors, independent broker-dealer advisors, insurance agents and registered representatives affiliated with wirehouses, large financial planning companies or insurance institutions. Some still believe that those who maintain securities licenses are simply too "sales driven," while others see RIAs as "touchy-feely." While organizations like the Financial Planning Association remain neutral about compensation and business models, professional infighting over fee-only versus fee-based compensation has contributed to consumer confusion-and frankly, it is our own fault.

There is no question that the trend toward fee-driven compensation is more than just a passing fad-it is clearly mainstream-but it's probably not the endgame. More planners are moving toward compensation models that resist the temptations of a large payoff (commission) to implement a strategy; instead, they are choosing to spread revenues over time by relying on a fee that is paid as long as the relationship is maintained.

But here's where I get stuck. And here's where I think the public is misled. In fact, I hold the CFP Board of Standards somewhat responsible because it actually defined two terms -fee-only and fee-based-and I'd challenge the new members of the board to revisit this issue.

DANGEROUS DEFINITIONS

What is the distinction between fee-only and fee-based? According to the CFP Board's website, the difference in definitions is as follows:

* A fee-based financial advisor is compensated both by fees paid by the client and by commissions that are contingent on the purchase or sale of financial products.

* A fee-only advisor is compensated solely by the client, with neither the advisor nor any related party receiving compensation that is contingent on the purchase or sale of financial products.

Go ahead, set up a focus group. Put consumers in a room for about 20 minutes, ask them how they might define the two terms. I think we'd all agree that these definitions are more hard-wired in the minds of planners than the people they serve.

I wonder what percentage of planners who hold themselves out as "fee-only" serve the public exclusively on a retainer or hourly basis. If the public were asked to define fee-only, only individuals who worked on a retainer or hourly basis would make the cut.

Of course, many advisors earn their compensation by calculating a fee based on assets under management. So why is it that RIAs believe that only they should be allowed to use the term "fee-only," while those who remain affiliated with a broker-dealer must use the term "fee-based?" And what about the RIA firm that maintains a separate insurance business; aren't the owners beneficiaries of profits from commission sales?