What You Need to Know About Certified Financial Planners

What You Need to Know About Certified Financial Planners Recent surveys conducted by the Certified Financial Planner Board of Standards, commonly referred to as CFP, shows that at least eighty-five percent of Americans consider it extremely important for their financial planner to be certified. Why? Simply because they answer to a governing body that ensures that only the highest standards will be adhered to. But, what that means to the investor is, in simple terms, they know what they’re talking about! If you are going to trust your finances to another human being, this is one thing you want to determine right up front. That is whether or not the person has the qualifications to actually guide you in the right way. The crux of the matter is that there are no federal regulations that state that a financial planner MUST be certified, however some states do have their own regulations. So while Rhode Island financial plannersmay not need to be certified, New York financial planners may! The best way to determine whether or not a financial planner needs to be certified in your state is to contact the Department of Business and Professional Licensing in your state either by phone or online. You can also do an internet search or find a site that has links to every state and will also note whether or not those financial planners are certified.

To obtain certification financial planning credentials, there are four requirements which must be met. These requirements are often referred to as the ‘Four Es” and the include Education, Examination, Experience and Ethics. There are no requirements to take and pass the examination conducted by the Certified Financial Planner Board of Standards, but, the financial planner will not receive certification unless those Four Es are met. The planner must have a Bachelor’s Degree in any discipline whatsoever, have experience, ethics and of course, have passed the examination. Because you will be trusting your financial planner not only with your money, but also with highly sensitive and private information, it is important to find a certified planner in your state. Whether or not your state requires it, a person who is certified has met with strict guidelines and answers to a Board of Standards that ensures they only deal ethically and in your best interest. This does not mean that a financial planner who is not certified doesn’t know what they are doing, but your chances of getting a knowledgeable professional increase when you seek only Board certified financial planners.