A national Financial Planning Confidence survey, commissioned by FP Canada in time for Financial Planning Week, reveals that Canadians’ lack of financial confidence may be preventing them from getting the financial help they need. The research finds that four-in-10 (41 per cent) don’t feel confident when speaking about their finances, and one-in-three (34 per cent) don’t ask for financial planning advice because they don’t know what type of questions to ask. The results were even higher among younger respondents, those earning a lower income and those with children under 18 in the household.
Even more troubling, says FP Canada, is another area where many Canadians have a right to be less than confident—specifically related to the qualifications of the person who is providing them with financial advice.
“In Canada, outside of Quebec, anyone can call themselves a financial planner without meeting any standards of competence, ethics or practice,” says author, personal finance educator and FP Canada’s Consumer Advocate, Kelley Keehn. “This leaves people confused and at risk. In fact, previous FP Canada research shows that half of Canadians think financial planners are regulated."
“In the absence of statutory or regulatory requirements for financial planners, the key is finding a qualified professional you can trust,” says Keehn. She recommends asking some key questions of anyone who presents themselves as a financial planner:
What are your credentials?
What experience do you have?
Are you regulated by and accountable to any organizations?
Do you follow a professional code of ethics requiring you to put my interests above all others?
Can I have that in writing?
The best way to build confidence is to take action. Ensure your advisor is a Certified Financial Planner® professional. In that way, you will know with confidence that they have demonstrated the knowledge, skills, abilities and accountabilities to help you understand all aspects of your finances, and are obligated to put your interests first.
“You don’t need to know everything before you get help,” says Keehn. “You wouldn’t feel you needed to be in peak physical shape before you hired a personal trainer. Neither do you need to have your finances in order before you find a professional financial planner. The bottom line is you shouldn’t suffer alone.”
About the Financial Planning Confidence Survey
A survey of 1527 Canadians was completed online between July 31 to August 3, 2017 using Leger’s online panel, LegerWeb. A probability sample of the same size would yield a margin of error of +/-2.5%, 19 times out of 20. Leger’s online panel has approximately 475,000 members nationally – with between 10,000 and 20,000 new members added each month, and has a retention rate of 90%.
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To learn more about building financial confidence, read Focusing on bite-sized goals helps people overcome their financial blind spots and watch Building your money confidence and Women and financial self-confidence.