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What is
the Financial Planning
Association?
The Financial Planning
Association (FPA) is the
membership organization for the
financial planning community.
Its members are dedicated to
supporting the financial
planning process in order to
help people achieve their goals
and dreams. FPA and its local
chapters promote the advancement
of knowledge in financial
planning, supporting programs
that enable members to better
serve their clients.
What should my audience
look for in a financial planner?
FPA believes that
everyone needs objective advice
to make smart financial
decisions and that when seeking
the advice of a financial
planner, the planner should be a
Certified Financial Planner®
licensee. That's because in
order to earn the designation,
individuals must pass a
comprehensive examination and
continue to meet the education,
experience and ethics standards
established by the Certified
Financial Planner Board of
Standards, Inc (CFP® Board).
Specifically, your audience
should look for a CFP®
practitioner whose manner,
style, area of expertise and
technical knowledge is right for
them. Your audience should
choose a planner who puts their
interests first and also offers
a thorough explanation - or
"full disclosure" - of how he or
she will be compensated.
Is there one method of
compensation that is better than
others?
Financial planners are
compensated in a variety of
ways, including fee-only,
commission, a fee/commission
blend and salaried. Each method
of compensation has its merits,
depending on your age, lifestyle
and financial situation. There
is no one right method. What is
important is that consumers
clearly understand how a planner
is compensated and any real or
potential conflicts of interests
that may exist. Armed with that
information, FPA feels that
consumers can focus on the
planner's competence as the
primary consideration in their
selection process.
How are financial
planners regulated?
Many financial
professionals are licensed on
the state and federal levels in
specific areas such as insurance
or securities. However, they are
not specifically regulated for
their financial planning
activities - with the exception
of the Certified Financial
Planner professional, who is
licensed by the CFP® Board. CFP®
professionals are held
accountable to the CFP® Board's
Code of Ethics and must also
meet its practice standards
requirements. The CFP® Board has
the power to suspend or revoke
the CFP® license from an
individual who violates the
Board's standards.
The Securities Exchange
Commission (SEC) and/or state
agencies also have requirements
for "investment advisers" - a
role that most financial
planners fulfill. If a planner
is a registered investment
adviser, or a representative of
an advisory firm, FPA advises
consumers to carefully review
the Form ADV, which discloses a
planner's experience, education,
credentials, licenses, manner of
compensation and potential
conflicts of interest.
How can my audience find
a financial planner in their
area?
Consumers may obtain
the names and phone numbers of
Certified Financial Planner
licensees in their area by
calling FPA's toll-free number,
800.282.PLAN (7526), or by
surfing to
www.fpanet.org on the
Internet. |
