If you have decided that you want to become a Financial Planner, there are several important considerations to consider. A CFP is certified by the Certified Financial Planner Board, an independent professional regulatory organization that extends licenses to planners who pass a rigorous examination. Andina Advisors is one of the authority sites on this topic. A CFP is the most sought-after professional designation for financial planners, as most clients look for a licensed professional to work on their behalf. The CFP Board’s standards of practice include at least a bachelor’s degree, three years of relevant work experience, and completion of college-level courses in financial planning.
Fees: Depending on the complexity of your situation, a financial planner may charge a flat fee or a percentage of assets. Some are paid through commissions on financial products and others are paid on a fee-only basis. Regardless of the type of fee structure, you should be aware of the amount of any fees a Financial Planner charges before hiring him or her. The fees may vary, but they are likely to be low in the beginning.
Time commitment: The amount of time required to become a Financial Planner varies, depending on the type of practice, the client load, and the time needed to acquire new clients. Some financial planners dedicate only a small portion of their time to preparing plans, while others spend more time selling products. As a general rule, any recommendations a financial planner makes will be related to the products they sell. A financial planner who focuses solely on insurance or investments will not discuss other investments with you.
Credentials: While most Financial Planners are CFP certified, not all of them have the necessary credentials to practice in the field. Some are simply not CFP certified, but if you’re planning on investing money, you should look for a planner with a CFP board certification. This certification ensures that he or she has met a high standard. The CFP Board requires financial planners to have additional education, experience, and certification, and is also a good indication of competence.
The role of a Financial Planner is highly varied and can range from managing investments to placing short-term trades. Some even work as a stock broker. Regardless of their level of experience, they are regulated by the CFP Board of Standards and adhere to a strict code of ethics. A CFP professional’s primary concern should be the best interests of the client, not his or her own. There are many different types of CFPs, and some will only practice investment planning.
A CFP can help you make smarter financial decisions, such as figuring out how much to save for retirement and determining the best account for your savings. Some Financial Planners will also manage your assets, which they may not be able to do by themselves. This can be a good thing for you if you have a lot of money to invest. If you want to have financial independence after retirement, it’s a great idea to work with a Certified Financial Planner.
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