How a financial planner uses the CSLP Program to grow business

At CSLA we talk all that time about the need for financial advisors to become more informed about how student debt affects the financial planning process and a client's life. Hear from a financial planner on the benefits of the CSLP program.

Recently we shared some time with Patti Hughes on a recent CSLP Podcast to learn about her experiences advising clients with student debt. Patti is President of Lake Life Wealth Advisory Group and a CSLP, as well as a CPA and CFP. This is a summary of Patti's story and her start with the program. 

So today, this post will outline some of what she had to say about the CSLP, her practice, and reactions from her clients. Listen to the entire podcast or just read on for a summary.

About Patti Hughes, President, Lake Life Wealth Advisory

I'm a solo practitioner, and a registered investment advisor in Illinois. I'm located in Chicago, but I serve many of my clients virtually across the country. I've got a master's degree in accounting and I'm a CPA. I also have a certificate in financial planning from Northwestern University. I'm also a certified financial planner and a certified student loan professional. I'm a member of the Illinois CPA Society, the Alliance for Comprehensive Planners, and NAPFA fund for fee-only comprehensive financial planning services.

The problem of advising clients with student debt before taking the CSLP

Well, when I started my business, the first couple of clients were young professionals, mainly young attorneys. In one case, both the husband and wife were attorneys and they wanted financial planning help because they making a substantial income, but they needed help on their student loans. Their balance was three hundred seventy thousand dollars and she was just getting out of law school. So I didn't know how to advise on this.

The natural reaction ... pay off as quickly as possible

My initial gut reaction when I first met with them on the phone and reviewed their financial information, my first reaction was, well, they're making a big income, just pay off as much as they can't figure out what they could pay.

Searching for a solution ...

And I was looking everything up online trying to figure out how I could do this. I ended up talking to a member of the Alliance for Comprehensive Planners, a guy on the East Coast, and he had the CSLP designation.

I asked him questions about dealing with these clients. And he said, you should take this program because to properly advise them, you're going to need the information.

So I signed up and I think I completed the whole program within a month. So I did that before I had my first meeting with one of my first clients. So that's how I started pursuing this designation.

Did the CSLP Program help you prepare for this client?

It definitely did.

I was just shocked going through the program at what I didn't know.

And after I went through the program, I was able to look at all these different options, like should they do previous private refinancing because the rate was a lot lower. Should they consolidate the loans?

These were all things I had no idea. I didn't even know that these were different options and that by making a bad decision, you know, it could affect the financial plan.

"So I really felt like the program helped immensely. I would not have been able to advise them if I had not gone through the material."

On Patti's Financial Strategy Session For Clients

Well, I provide a financial strategy session, which is a one-time engagement. And with people with student loans, I offer a financial strategy session and usually, that is with people who need help with a couple of pressing issues. But what I do is I tell them I recommend that I said if anything changes down the road, any major life change, then we need to sit down and revisit the whole plan.

Many of these clients are young professionals who are just starting. They have significant income, but they also have huge student loan debt.

So they need financial planning help, but they feel the need to first address the student loan issues and I also work with many pre-retirees. And they're also dealing with student loans for their children.

So the student loan, can kind of span across the ages. But it's become a big part of my practice.

I've been getting referrals from other advisors who don't know how to serve these type of clients.

The CPA and Advising Clients with Student Loans

I'm also a certified financial planner. And I have a master's degree in accounting and I have a certificate in financial planning from Northwestern. So I have all the designations that you would need for a financial planner and an accountant.

But student loans were never addressed in any of these programs (CPA, Accounting, Financial Planning). So that's what was shocking to me.

I thought, well, I'm going to look back on the material and did I miss something? It is not even being addressed in any of these programs. And I can't believe it because there are so many clients out there right now that are touched by student loans.

Either they have them or their kids have them. So clients that are looking for an advisor to help them with student loans, if they're just looking for a CFP or somebody with a CPA and assume that these people know student loans, they don't.

About the CSLP Material - Rigorous ?

Well, I would describe it as rigorous. There's a lot of content in there. There's a lot of detail. And I would say it was comparable to the CFP program that I went through, very comparable to that. And there, you know, with this program, there's also a lot of calculations, you know, that you have to be able to do. And then the case studies were really helpful. They touch on everything.

So I would say that I would tell anybody that if they're taking this program; it's very rigorous and it's very comprehensive.

And I think that's what makes it so valuable, is that it's not just an overview. You get into the weeds on all these topics.

Practice Benefits, speaking, and referrals

It's helped my practice because I was able to develop a niche market.

And I think that once people know that you have this designation and they know that you've worked with clients, with student loans, people come up to different advisors, like when I was doing these speaking engagements and they come up to me and they said, I am definitely going to refer any clients that come in with student loans to you.

So I have obtained referrals from different financial advisors and even within the Alliance for Comprehensive Planners, once I somebody was looking for help with a student loan and I responded to an online forum and I was working with the client of the president of that group. And he immediately put out a post and said, what a terrific job I did and how happy the clients were. And he said, anybody who's got clients with this, that they should talk to me. And so it's really helped my practice a great deal.

Speaking engagements

I've been getting a lot of referrals and also speaking engagements. When you do the speaking engagements, the one I did in Chicago was for the Professional Women's Club of Chicago at the Union League Club. And so the financial advisor subgroup about 30 people when they were financial advisors, attorneys and accountants, and I even received referrals from them.

So it really allows you to expand your practice because you have specialized knowledge that other people don't have. So I think it's been really beneficial for me.

Another client experience with Patti

Well, one of my first clients was was an attorney out of California. And she and her husband, who made very good income over three hundred thousand dollars. But she had two small kids and was only working maybe 10 hours a week. And she was starting her own business in immigration law. So she was not making much of an income at all, but her student loans were over three hundred thousand dollars and her monthly payment on the student loan was four thousand dollars. And they were having a tough time making ends meet. And it sounds ridiculous, you know because he's making that bit of an income but housing is very expensive in California.

And so they contacted me and wanted to get some advice on what they could do. And I was able to put them in an income-driven repayment plan and have them do married filing separately. And her monthly payment dropped from four thousand dollars to about one hundred dollars a month. So, you know, it was it helped them so much. And I was able to take those savings and then recommend investments that can help them for retirement planning and the college education for their kids.

I'll do multiple projections for these clients and then at least I'll present my recommendations. But they are also able to see all these different alternatives.

Patti's recommendations for student loan borrowers

Well, I would recommend that they look on (CSLA Board of Standards) site and get somebody that is certified because as far as I know, this is the only organization that has such a comprehensive program.

I would say get somebody that's been through the program and don't just get a regular financial adviser, you need somebody that has this very specific knowledge.

What would you say to advisors?

I would encourage them to get this designation because if you're a fiduciary, you're supposed to be acting in the best interest of the client. You're not supposed to just provide an acceptable solution. You're supposed to provide the best solution.

And I feel like that if you don't know how to give the client the best solution, you either need to refer that out to another adviser that can or you need to get the education that you need to provide the best advice.

So I feel like any of the financial advisors that are fiduciary is really have to act in the best interests of the client. And if they don't have the knowledge, just like if it was an estate planning attorney, you know, you don't know all the nuances of it. You need to refer that out or you need to get this designation. So I would encourage any advisers that deal with clients with student loans to get this designation.

On CPAs and their knowledge of student loan advising

It's easy to know that the client has student loans. So if you have married clients with student loans, you should be able to run projections both married joint or separate to see which programs they're eligible for.

So I feel like CPA should also be either knowledgeable in this or refer these clients out if their specific questions that they have about what programs they'll be eligible for and how the tax, you know, how their taxes will change based on the filing status.

This information is definitely not covered in any of the accounting classes or the CPA material. There is a real lack of knowledge for accountants and CPA.

And that could cause problems for the client, too, because if they're getting advice through a CPA as opposed to a financial planner, the CPA right away will probably say, well, you don't want to file separately, but not looking at the whole picture, the whole client picture.

How much they might be able to save, you know, by being in an income-driven repayment plan, particularly when there's a disparity in income. You know, if the borrower makes a lot less than the spouse, it can make a huge difference in the payments.

Final comments from Patti

Well, I would just like to say how much I've appreciated the content that was in the course and how much it's helped me. And I refer to it all the time, too, with different borrowers. And I also feel that the software is very easy to use and it's really good for showing multiple scenarios to clients. So I think that this program is really beneficial to any advisors out there and that I think that you're doing a disservice to your clients if you're advising people with student loans. And if you don't obtain the knowledge that you need to advise them if you're not giving them the best possible advice.

I just think they refer them to somebody aware of all these different alternatives and that has the right education. So the program has helped me immensely and the software is great for showing different projections for clients. So it's helped my practice.

To hear the entire episode and others, visit the CSLP Podcast Page.


 
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Larry Taylor, PhD

Written by Larry Taylor, PhD

Larry has over 20 years of experience as a marketing technologist and developer of financial education programs. One of his primary missions is to help professionals establish greater trust in their online audiences and to humanize digital communications. Larry holds a Ph.D. in Psychology with an emphasis on media.

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