How to choose a financial planning analyst who
will help you reach your goals and dreams
The financial planning analyst whom you pick should be the
very best for the future of you and your family -- that obvious,
but, what should you look for in an analyst?
The CFP Board of Standards Inc. (the body which certifies
financial planners in the USA) has published a brochure called Your rights as a client (opens new window) and based on
this; we have prepared an outline of what things to look for:
a. You need a professional planner and/or advisor
The person who is going to advise you should be
qualified and licensed to provide these services.
It is also important to realize that when your
financial planning analyst lack experience in
certain services (e.g. estate planning) he should
suggest or refer other professionals who could
b. You need a planner and/or advisor who is competent
It is important that your advisor be able to
demonstrate that he has sufficient knowledge to
advise you in the field of financial planning, for
example having been certified as a Certified
Financial Planner and is constantly keeping up-to-date
through attending courses and continuing education
in the field.
c. You need a planner and/or advisor that offers objective advice
financial planning analyst should always be working
with your best interests in mind. For this
reason, the evaluation of your situation and the
recommendations which he provides should reflect this.
Professionals who act as fiduciaries have an obligation
to do this.
These days there are numerous so called "financial
advisors" who are really salesmen of financial
products. For this reason, distinguish between
those who work for your benefit and those who don't.
In general, lawyers, CPAs and investment advisors
are fiduciaries. Financial Planners might be,
depending on how they are paid for their
services. On the other hand, insurance agents
and stock brokers are not fiduciaries because they
have an interest in selling you something.
As a general rule we can say that in order to
presume that the advice you get is really objective
and with your best interests in mind, your financial
planning analyst should not receive or generate any
benefit for third parties from any recommendations
given to you and should receive only one
remuneration for the advice which is given.
This is a key concept and overlooking this could be very
d. You need a planner and/or advisor who treats you
fairly and transparently
Your advisor should clearly inform you about the services
which he provides and the cost of these. He should also
inform you of any conflict of interests which might exist and
the risks associated with the recommendations which he gives
e. You need a planner and/or advisor with integrity
Given the importance of planning your finances, it is vital
that there is enough confidence between you and your financial
planning analyst for the relationship to be worthwhile.
For this your advisor should demonstrate his integrity and
adhere to a strict code of ethics.
The best way to do this is to know the bodies which regulate
the advisor's activities and contact them to verify their
qualifications before hiring them.
f. You need a planner and/or advisor who is diligent
From the start your advisor should demonstrate that he has a
genuine interest for you, for example:
- Before accepting you as a client he should demonstrate an
interest in your needs and objectives and inform you if he
believes he is capable of meeting all or only part of your
- Also he should investigate and have extensive knowledge of
the products and services which he recommends,
- Supervise the support staff who will work with you.
g. You need a planner and/or advisor who offers you
security concerning his services
It is important that your financial planning analyst provides
a written contract covering all aspects of the services he
provides and committing to respect your privacy.
h. You need some option where you can lodge a
complaint concerning your planner or advisor, if necessary
If, for any reason, you need to register a complaint with your
financial planner or financial planning analyst, it is
advisable that you know beforehand what professional
association the consultant is affiliated with.
For example a complaint about a Certified Financial Planner (CFP)
could be made with the organization which controls
certification in your country. On the other hand, if you
have another kind of advisor, (CPA, Stock Broker, etc.)
normally you can complain to the bodies which license these
Some links to sites related to bodies where you might register
Other sites in the USA:
Sites in Australia:
Sites in Canada:
It's true that there are a lot of details to consider, but it
is necessary to know these because it's your future which is at
stake and in this step you need to define what is important to
But, where do you start and how do
you evaluate the points we've raised? To help you with
this we've created the following tool:
to Choose a Financial Planner. This has
practical questions to help you rate your
candidates as well as a ranking system to help
you choose your advisor.
To use this tool you will need Microsoft Excel or the free alternative Open Office.
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