| Why you should choose a
CERTIFIED FINANCIAL PLANNERTM
practitioner
Choosing a financial planner may be one of the most
important decisions you make for yourself and your loved ones.
Financial planners can provide you and your family
with guidance over your lifetime, or work with you to address
specific concerns as needed. Regardless of how you
choose to work together, a planner can play a central role in
helping you meet your life goals and achieve financial
well-being. Consequently, take the time to select a financial
planner who is competent and trustworthy, one on whom you can
depend for professional advice and services.
Mark of
Quality
CFPTM, and
CERTIFIED FINANCIAL PLANNERTM are marks owned
by the Certified Financial Planner Board of Standards (CFP
Board) which help you identify financial planners who are
committed to competent and ethical behavior when providing
financial planning services. CFP practitioners have
taken the extra step to demonstrate their professionalism by
voluntarily submitting to the rigorous CFPTM certification process. In addition to
significant education and experience requirements, they must
pass a comprehensive exam that tests their personal financial
planning knowledge and skills, continually update their
abilities and abide by the CFP Board's Code of Ethics and
Professional Responsibility (Code of Ethics) and Financial
Planning Practice Standards (Practice
Standards).
When
you work with a CFP practitioner, you are the focus of the
financial planning relationship and your needs drive the
financial planner's recommendations. As a client, you can
choose from a wide variety of planners and planning services.
CFP
practitioners can work in several settings including small
financial planning practices, large financial services firms,
credit unions, banks and other financial institutions.
Planners are compensated for the services they provide in
different ways, as well. Some are paid through commissions,
and others through fees or a combination of both. While all
CFP practitioners are trained to provide you with
comprehensive financial planning services, some specialize in
one or more areas, or work with specific types of
clients. Choose one with whom you feel comfortable
and who best meets your needs.
Tested For Competency
When
selecting a financial planner, you need to feel confident that
the person you choose to help you plan for your future is
competent and ethical. To earn the right to use the
CFPTM marks,
individuals must complete the following competency
requirements.
Education:
Develop theoretical and practical
financial planning knowledge by completing a
comprehensive course of study at a college or university
offering a financial planning curriculum, including over 110
educational institutions registered with the CFP Board.
Examination:
Pass a comprehensive two-day, 10-hour
CFPTM
Certification Examination that tests their ability to apply
financial planning knowledge in an integrated
format. Based on regularly updated research of what
planners do, the CFP Board's exam covers the financial
planning process, tax planning, employee benefits and
retirement planning, estate planning, investment management
and insurance.
Experience:
Have a minimum of three years' experience
in the financial planning process prior to earning
the right to use the CFP marks. As a result, CFP
practitioners possess financial counseling skills in
addition to financial planning
knowledge.
Committed to Ethical Conduct
Ethics:
As a final step to certification, CFP
practitioners agree to abide by a strict code of professional
conduct, known as the CFP Board's Code of Ethics
and Professional Responsibility, that sets forth their
ethical responsibilities to the public, to clients and to
employers.
Through the Code of Ethics, CFP
practitioners agree to act fairly and diligently when
providing you with financial planning advice and services,
always putting your interests first. The Code of
Ethics states that CFP practitioners are to act with
integrity, offering you professional services that are
objective and based on your needs. They are required to
provide you with information about their sources of
compensation and conflicts of interest in writing, and must
keep personal details obtained while working with you
confidential.
Re-Certified Every Two Years
Once certified, CFP practitioners are
required to maintain technical competence and fulfill ethical
obligations. Every two years, they must complete a
minimum of 30 hours of continuing education, staying current
with developments in the financial planning profession to
better serve their clients. Two of these hours are spent
studying or discussing the CFP Board's Code of Ethics or
Practice Standards.
In
addition to the biennial continuing education requirement, all
CFP practitioners voluntarily disclose any public, civil,
criminal or disciplinary actions that may have been taken
against them during the past two years as part of the
re-certification process.
Financial Planning Practice Standards
You
may be confused about how to distinguish financial planning
from other kinds of financial advice. To help you understand
what to expect from the financial planning process, CFP
practitioners follow certain standards - called Financial
Planning Practice Standards - when providing financial
planning advice. Practice Standards describe the
process you should reasonably expect a financial planner to
use during a financial planning engagement. These standards
are based on a six-step financial planning process, documented
through CFP Board research.
The Financial Planning Process
- Establishing and defining the client-planner
relationship
- Gathering client data including goals
- Analyzing and evaluating the client's financial
status
- Developing and presenting financial planning
recommendations and/or alternatives
- Implementing the financial planning
recommendations
- Monitoring the financial planning
recommendations
When
providing financial planning advice, a CFP practitioner will
define the scope of the work she or he will do with you, and
clearly explain and document the services she or he will
provide, the method of compensation and other relevant
information. CFP practitioners will work with you to determine
your personal and financial goals, needs and priorities;
understand your time frame for achieving results; and discuss
your tolerance for financial risk. Practice Standards also
require the CFP practitioner to gather all necessary financial
information about you when developing your personal financial
plan.
A Matter of Trust
As
more people call themselves "financial planners," finding the
right professional to address your financial planning needs
isn't always easy. Take your time when choosing a financial
planner. Before making a decision, become familiar with the
planner's business style and understand the level of services
he or she provides. Look for a measure of the planner's
commitment to ethical behavior and adherence to high
professional standards. Most importantly, look for a
financial planner who will put you and your needs at the
center of every financial planning engagement.
About the CFP Board
The
CFP Board is a nonprofit professional regulatory organization
founded in 1985 to benefit the public by fostering
professional standards in personal financial planning. An
independent certifying organization, the CFP Board owns the
marks CFPTM, CERTIFIED FINANCIAL
PLANNER.TM | 
