Your choice of a financial planning professional is an important decision that will affect all aspects of your financial well-being, today and in the future. Yet in most Canadian provinces, there is no legislated standard in place for those who offer financial planning services.
An appropriately qualified financial planner such as a CFP® professional meets stringent proficiency and ethics requirements, including high levels of education and experience and a written obligation to put clients’ interests ahead of their own.
Use the following tips to help find a qualified planner who is right for you.
☑ Be prepared: Do some research to become familiar with financial planning terms and strategies. While a good financial planner will explain things as you go along, understanding the basics will allow you to be more involved in the process.
☑ Consider your financial and personal goals: Financial planning is about finding the right strategies and taking the appropriate steps to help you meet your life goals. Take the time to reflect on what's most important to you, both today and for the future.
☑ Understand fee structures: Your planner should disclose in writing how s/he will be paid for the services they provide. Planners can be paid through the cost of products, a percentage of assets they manage on your behalf or a fee-for-service model based on hourly or set fees. Understand how you will pay for services and choose whatever model works best for you.
☑ Demand competence and ethics: There are a variety of different designations in the financial services industry, some requiring minimal education such as day or weekend courses. The Certified Financial Planner® certification represents the standard in financial planning, with strict education, experience, competence and ethics requirements. In fact, CFP professionals must annually attest to a written code of ethics stating that their clients’ interests will always come first.
☑ Perform due diligence: Take the time to verify a planner's credentials by contacting his or her professional body to confirm good standing. Verify a CFP professional’s designation and status here.
☑ Get it in writing: Insist on a written letter, sometimes called an engagement letter, outlining the specific terms of your agreement and any potential conflicts of interest. The letter should also clearly disclose your planner's method of compensation and business affiliations.
☑ Reassess the relationship regularly: Frequent communication is imperative to a good relationship with your planner. Make sure your planner understands your needs as they change over time and have your plan updated accordingly.