Pro bono planning can bring big wins for clients and advisor careers

Almost 20 years ago, Saundra Davis witnessed an exchange between a volunteer financial advisor and his pro bono client that showed why "words matter so much," she said. 

In the course of trying to celebrate his client's success in starting her own business, the CFP program student said something that demonstrated "how we view people can often come out in ways that we do not intend," Davis, a planner, educator and coach who is the founder of Sage Financial Solutions, recalled at a webinar on pro bono services held this week by the National Association of Personal Financial Advisors and its nonprofit arm.

"With the most earnest voice you can imagine, he says, 'You should be so proud of yourself. You could be homeless right now,'" Davis said. "The woman's face just completely dropped. She closed off. She shut down. She completely disengaged from the relationship. And I could see it. He could not see it. He could not see that what he thought was a compliment was actually very distressing for her."

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Such communication pitfalls remain a problem for the profession in reaching vulnerable clients who have a real need for the services but often find good reason to distrust providers who are volunteering through a rising number of pro bono planning organizations, Davis noted. Besides aiding the clients, the volunteer opportunities carry a lot of potential for registered investment advisory firms and other wealth management companies eager to recruit and retain advisors and for newer professionals seeking to gain a foothold in the field, she said.

Any early career advisors who are "feeling a little nervous about, am I good enough? Do I have my skills together?" can identify planning areas where they already excel and refer clients to other professionals for topics where they may be less comfortable at this stage, according to Davis.

"As a new financial planner, doing pro bono work is one of the very best ways for you to build your confidence in your competence," she said. "One of the things about being a new financial planner that's beneficial to do pro bono planning is you get to practice with a human."

Networking and professional development organizations are helping to ramp up the services through collaborations with the nonprofit Foundation for Financial Planning and other groups.

The NAPFA Foundation facilitates volunteer programming with Building Homes for Heroes, Advisers Give Back, Savvy Ladies and a college affordability initiative through College Aid Pro. The Financial Planning Association, which also held a virtual event this week devoted to pro bono planning, has a volunteer program in partnership with the Foundation for Financial Planning. And, after adopting a resolution last year encouraging CFPs to provide pro bono services and reaching more than 100,000 designees earlier in 2024, the CFP Board has set a goal of boosting the number of certificant volunteer hours by 100,000 this year to 412,237.

The CFP Board and the Foundation for Financial Planning formally launched their partnership in 2022 after a lot of joint efforts over the years. The pro bono planning development and support organization matches volunteer CFPs to clients through the ProBonoPlannerMatch.Org website. Interested planners can use the organization's website for pro bono volunteer training and skills-building webinars that come with continuing education credits and benefits like free errors and omission insurance, according to Jon Dauphiné, the FFP's CEO. Planners perform pro bono service to serve clients "who otherwise would lack access to objective, expert advice" and "bolster both their hard and soft skills," he said in an email.

Citing the fact that there are 100,000 CFPs and a recommendation from the CFP Board that designees complete 20 hours of pro bono service, Dauphiné calculated that if about 70% of CFPs fulfill that goal it would add up to 1.4 million volunteer hours on behalf of 467,000 clients. While that "would not meet the total overall need," that would constitute "an enormous contribution to their overall financial security," he said. "Other tech-driven interventions, including perhaps generative AI with outputs overseen by human advisors, could scale this even further. In short, the impact the profession can have via pro bono service is growing and potentially enormous."

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To attain that level of impact, the volunteers must avoid traditional industry tropes that add to systemic barriers to accessing advice and other important tools of wealth-building, Davis noted. 

Low or moderate-income earners often report that they feel a lack of trust, worry about the high costs, sense complexity and intimidation, fear getting judged, confront cultural- or language-based walls and face a limiting belief that they have no assets to plan with or for, she said. Davis urged attendees not to "assume that just because they're low income, that their needs for financial planning are not complex" and to "learn what's going on with them just by listening well." Displaying a sense of curiosity about their goals rather than immediately giving them advice and celebrating achievements without patronizing people go a long way, she said.

"Acknowledging is recognizing what you're doing for yourself. Cheerleading is, 'Oh, great. I'm so proud of you.' And this is straight out of the coach's handbook," Davis said. "People don't need us to be proud of them. They need to be proud of them. And so if I were to say to someone who's coming back like, 'I just really acknowledge that, with having two jobs and a family, you show up for our appointments on time. I appreciate it, and I want to acknowledge you taking these steps for yourself, you prioritizing your financial health and well-being.' And so that's the difference between, 'Oh, I'm so proud of you,' which can be trivialized, and acknowledging with real empathy."