What To Expect
Ultimately, you're responsible for maintaining control of your finances. And knowing what to expect from a financial planning relationship puts you in the driver's seat. To get the most out of your experience with a financial advisor, it's important to understand that you can expect and learn about the duties of a financial advisor.
Seven Traits to Look for in a Financial Advisor
A Planner Who Is Competent
Certified Financial Planner™ professionals demonstrate an appropriate level of financial planning. CFP® certification reinforces your financial planner competency, through rigorous education and experience requirements—including continuing education coursework.
Provides Objective Advice
Your needs will be at the heart of all your planner's recommendations. CFP® professionals have an ethical obligation to follow their financial planner duties and act in your best interest. Your financial advisor will use his/her experience and judgment to carefully consider your situation then give you advice that best meets your goals. Sometimes, this objectivity may require your planner to explain that your goals are unrealistic given your current resources and financial commitments.
A Planner With Integrity
Trust is central to a successful financial planning relationship. You rely on your planner's honesty, professionalism and abilities to achieve your goals. When you know your planner takes his financial planner duties and responsibilities seriously and places principles over personal gain, you can form a good working partnership. CFP Board's strict Standards of Professional Conduct are designed to ensure CFP® professionals act in a professionally responsible manner.
Ensures Fair Treatment
Fair treatment means your Certified Financial Planner™ professional will clearly state what financial planning services will be provided and at what cost. Your planner will also explain the risks associated with his financial recommendations, along with any potential conflicts of interest. For example, does the financial planner gain personally or financially from your purchase of a particular product or from the outcome of a suggested strategy? CFP® professionals are required to disclose any money they make from the sale of a product.
A Planner Who Is Diligent
Before engaging you as a client, your Certified Financial Planner™ professional will discuss your goals and objectives and explain what you can expect from the relationship and financial planning services. Once your planner has determined that he (or his staff and/or network of related professionals) can assist you, the planner will make recommendations suitable for you. A diligent financial advisor will reasonably investigate the products or services he recommends and closely supervise any staff working with you.
A Planner Who Is Professional
Your CFP® professional will not provide investment advice or stock brokerage services unless he is properly qualified and licensed to do so, as required by state or federal law. A financial planner who holds CFP® certification may not be a broker/dealer, which refers to an individual who is licensed to buy and sell investment products for or to clients.
To get the best results from your financial planning relationship, you need to divulge relevant personal and financial information to your financial planner on a regular basis. Your CFP® professional will keep this information in confidence, only sharing it to conduct business on your behalf, at your consent or when ordered to do so by the courts.