Critical Considerations When Determining a Financial Planner
Finding the right financial planners for your commercial requirement is not an easy task. They are not always unbiased and do not always act in the best interest of their clients. Hence, you need to understand several critical pointers to obtain the best one. The following are several critical considerations when determining a financial planner.
Planning Authority
A financial planning credential, such as Certified Financial Planner or Personal Financial Specialist (CFP), is a sign that the person you’re working with has the training and experience to be a financial planner. Only those who meet the requirements for CFP or PFS certification receive these credentials. They must also pass certification exams and engage in continuing education and practical training standards.
Fee Structure
This point determines who you serve best, your client or yourself. Fee-only professionals charge for their advice, while fee-only professionals earn commissions, referral fees, and other financial incentives for the products and solutions they recommend. A fee-only professional is more likely to advise you objectively and for your benefit than a fee-only financial advisor. A professional who charges a fixed fee is a good choice if it is aligned with your best interests.
Professional Competence
Financial planners are not subject matter experts, but planning professionals. A financial planner may be an expert in tax planning and analysis, but a CPA, an IRS enrolled agent (EA), may not be an expert in tax rules. Similarly, a financial advisor may be trained to create an investment plan, but, unlike a licensed financial analyst, not be an authority on investments. A financial planner must also be an expert in the areas that will help you achieve your financial goals.
Supporting Financial Planners
Many financial planners specialize in certain types of clients. A personal planner may specialize in serving only certain types of clients. They may also tailor their services to the needs of specific individuals or families. To determine if the planner is right for you and your financial goals, ask if they specialize in certain clients. Do not hesitate to find out more information to your financial planner.
Accessibility
The planner must be available and attentive to you at all times. Ask your planner how many clients he currently serves and how many he plans to serve in the future. This report will help you estimate your planner’s future availability. Ask the planner which planning tasks they usually do themselves and which they delegate to paraplanners or younger employees.