REGULATORY/LEGISLATIVE
Promoting Fiduciary Standards and the Financial Planning Profession
By Michael A. Watkins
The NAPFA Public Policy Committee, consisting of NAPFA volunteer leaders and chaired by Dan Danford, CFP®, focuses its efforts on important issues and trends that affect NAPFA members and the financial planning profession.
To place the committee’s work in context, it’s helpful to review NAPFA’s policy goals, the advocacy partners NAPFA collaborates with to magnify its national impact, and current policy objectives and achievements.
Policy Goals and Advocacy
NAPFA’s policy goals and advocacy activities are national in scope and focus on developments likely to have a significant, nationwide impact on retail investors, retirement savers, and the financial planning profession.
For more than a decade, NAPFA’s overarching policy objective has been the regulation and recognition of financial planning as a separate, distinct profession based upon a robust fiduciary standard of care for retail investors that is no less stringent than under the federal Investment Advisers Act of 1940.
To develop and implement effective advocacy strategies that amplify NAPFA’s voice among government, the media, and the public, NAPFA actively participates in and supports formal and ad hoc policy coalitions whose members typically are other national organizations. Through these coalitions, NAPFA and NAPFA advisors continue to play leading roles in policy debates at both federal and state levels.
NAPFA’s Advocacy Partners
Responding in 2008 to the global financial crisis, NAPFA, CFP Board, and the Financial Planning Association (FPA) launched the Financial Planning Coalition to promote the regulation and recognition of financial planning as a profession incorporating a strong fiduciary standard for all personal investment advice.
During the 2009 Congressional debate on the Dodd-Frank Act, NAPFA and its partners AARP, AICPA, Better Markets, CFP Board, Consumer Federation of America, FPA, Investment Adviser Association (IAA), and North American Securities Administrators Association (NASAA) convened the Friends of Fiduciary to advocate for a robust fiduciary standard and enhanced investor protections.
Through these two coalitions, NAPFA advocated for inclusion of strong fiduciary standards in the 2016 Department of Labor (DOL) Fiduciary Rule and the 2019 SEC Regulation Best Interest, and opposed legal, legislative, and regulatory efforts to weaken fiduciary standards. In addition, NAPFA and its partners advocated on the state level for expanded financial literacy education, and for heightened protections for retail investors, retirement savers, seniors, and vulnerable persons.
As partner organizations’ priorities evolved, and the Financial Planning Coalition and Friends of Fiduciary wound down their activities, NAPFA continued pursuing its policy objectives through new and emerging coalitions as well as continuing to work closely with CFP Board on joint projects affecting CFP® professionals. The following are several policy coalitions NAPFA participates in:
The Save Our Retirement Coalition (SOR) encompasses approximately 100 national organizations and groups advocating for better protections for retirement investors. The steering committee includes former Friends of Fiduciary organizations as well as leading labor and consumer rights organizations. Since 2023, NAPFA and CFP Board have actively participated in a working group led by SOR that advocated successfully for the adoption of the 2024 DOL Investment Advice Rule and have opposed actions that would prevent or limit full implementation of the rule.
The Advisory Fee Deductibility Coalition seeks to restore and expand the federal tax deduction for professional investment and financial planning advice that was repealed by the 2017 Tax Cuts and Jobs Act (TCJA).
The Professional Certification Coalition (PCC) represents more than 90 certification organizations nationwide that are concerned about government action that might adversely affect their ability to grant private professional certifications, e.g., NAPFA-Registered Financial Advisor, CERTIFIED FINANCIAL PLANNER®, etc.
The Tomorrow’s Workforce Coalition includes over 500 organizations supporting federal legislation to permit Section 529 savings plans to pay for postsecondary training and credentialing, including licenses and professional certifications.
The Financial Services Coalition for 199A Fairness advocates for the continuation of the federal Section 199A pass-through business income deduction and removal of limitations on the ability of independent financial services professionals to fully benefit from the deduction.
Policy Objectives and Recent Achievements
1. 2025 Federal Tax Bill – One Big Beautiful Bill Act
As the 119th Congress and new Trump Administration were sworn into office during January 2025, NAPFA and its advocacy partners identified several policy objectives, each of which had been a focus for advocacy during 2024, that might advance through Congress and potentially be signed into law.
Through the Advisory Fee Deductibility Coalition, NAPFA advocated for passage of the Secure Futures Through Financial Planning and Advice Act to allow individuals (not businesses) to deduct investment advisory and financial planning fees paid to financial professionals whose advice is provided pursuant to a fiduciary duty.
Through the Tomorrow’s Workforce Coalition, NAPFA petitioned Congress to pass the Freedom To Invest In Tomorrow’s Workforce Act, which would permit Section 529 savings plans to pay for postsecondary training and credentialing.
Through the Financial Services Coalition for 199A Fairness, NAPFA sought to amend Internal Revenue Code Section 199A to exclude independent financial advisors serving retail clients from the “specified trade or business” definition and thus clarify the tax benefits available to them.
NAPFA participated in drafting proposed legislation, winning commitments from Congressional “legislative champions,” engaging in discussions with federal officials, and “signing on” to coalition letters and media statements supporting these legislative proposals.
On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act. Although its primary purpose is to extend tax cuts authorized under the 2017 Tax Cuts and Jobs Act, the new law also includes the Freedom To Invest In Tomorrow’s Workforce Act legislation proposed by NAPFA and its partners.
This significant legislative achievement is the result of five years of consistent advocacy by NAPFA and its partners. Because of those efforts, Section 529 college savings plan funds today can be used by all Americans to pay the costs to obtain and maintain professional licenses and certifications.
Although Congress did not include in the new law NAPFA’s proposals for either the advisory fee deduction or the Section 199A language amendments, continued advocacy by NAPFA and its partners will increase the likelihood that Congress may act on these issues in the future.
2. Federal Fiduciary Standards
NAPFA actively supports the adoption and implementation of robust fiduciary standards for all retail investors and retirement savers.
For example, during 2024 and 2025, NAPFA has been a vocal supporter of the 2024 DOL Investment Advice Rule. NAPFA met with regulators, provided written comments, and testified at public hearings to help DOL develop and approve the Rule.
NAPFA has consistently opposed efforts in Congress, the Administration, and lawsuits that would rescind, defund implementation of, or weaken the Rule or the fiduciary protections it would provide for retirement savers.
3. Retirement Security
NAPFA and CFP Board joint meetings with Congressional offices have resulted in requests for CFP® professionals’ assistance to address the nation’s retirement security crisis, an increasingly bipartisan issue in Congress. In response, NAPFA and CFP Board organized a working group of CFP® professionals who produced a draft proposal entitled Report on Improving the U.S. Retirement Plan System. NAPFA and CFP Board may present this report to Congress as part of future Capitol Hill joint advocacy efforts.
4. Protecting Seniors
NAPFA supports proposals to protect seniors—such as H.R. 1469/Senior Security Act of 2025, which passed the U.S. House in July 2025—and similar initiatives to provide federal grants to state securities and insurance agencies to fight senior investor fraud, dedicate a SEC task force focused on senior investors’ issues, and fund SEC collaboration with state securities and insurance regulators to fight senior financial fraud.
5. NASAA Model Rules and State Regulation
NAPFA maintains a dialog with NASAA about regulatory developments and model state law proposals, with a focus on alternative fee models being developed and employed by financial planners. For example, NAPFA filed a comment letter with a state regulator on financial planner fee guidance that highlighted potential disparities in documentation burdens that might favor AUM advisors over advisors who use alternative fee arrangements.
NAPFA recently provided written testimony, jointly with CFP Board and FPA, at a state securities hearing petitioning the state regulator to adopt a widely followed SEC interpretation of a custody rule instead of the state regulator’s proposal that advisers viewed as more restrictive and more likely to increase compliance costs and compliance errors.
6. Occupational Licensing and Professional Education Funding
Congress and state legislatures are seeking alternatives to reduce or eliminate barriers to employment based on prior criminal convictions. Through the PCC, NAPFA advocates for legislative and regulatory approaches that protect the rights of nongovernmental, private certifying organizations to issue and administer professional licenses and certifications.
7. SEC Investment Adviser Oversight
NAPFA monitors and comments on the SEC’s oversight of investment advisers. This includes reviewing recently proposed rules involving custody, outsourcing, digital assets and crypto, data analytics, and doing business over the internet.
Public Policy Committee Invites Your Participation
NAPFA members who are interested in promoting NAPFA’s public policy goals serve as volunteers on the NAPFA Public Policy Committee, which works closely with the NAPFA Board of Directors, CEO Kathryn Dattomo, and the organization’s consultants. The Committee meets monthly to review memoranda provided by the policy counsel, discuss developments, provide practitioner insights on significant new rules, and oversee steps NAPFA is taking, such as meetings with key decision-makers and filing public comment letters.
The active involvement of Committee members ensures the real-world experience of financial planner practitioners is reflected in NAPFA’s policy positions and advocacy. For these reasons, I encourage you to reach out to the Public Policy Committee at any time and respond should it ask for your assistance. The Public Policy Committee and NAPFA’s policy consultants work to represent your interests.
Michael A. Watkins is president and general counsel of Financial Markets Consultants LLC, which since 2013 has provided regulatory and policy support to NAPFA, the Financial Planning Coalition, and allied capital markets advocacy organizations. Email him at watkins@finmarcon.com.
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