Financial Planning Specialist: Eligibility And Checks

A Financial Planning Specialist or an Advisor is a professional person who studies your financial state and suggests the best financial plan that maps to your requirements or goals. Their scope of work extends to investments, taxes, insurances, wills etc.

To plan our finances is a life time activity so it is always advisable to go to financial experts to act as a guide for us. Wrong investments could lead to loss in finances and this is what we dread.

Here are some specialists to check with on specific or specialized areas relating to finance planning:

CFA- Chartered Financial Analyst.

CFP- Certified Financial Planner

CFS- Certified Fund Specialist

PFS- Personal Financial Specialist

QFP- Qualified Financial Planner

Eligibility criteria for specialists are outlined as follows:

1. Note that in the aforementioned context, a specialist is a qualified person who specializes in life insurance and annuities matters and is required to pass an insurance examination in order to secure a license to practice in this field.

2. A financial planning specialist has to be registered under Securities and Exchange Commission.

3. A financial specialist charges a fee to us based on the advice you seek from him. This fee can be compensated to him in the form of any of the following ways:

commission only,

fee only,

fee plus commission or

the fee offset.

The fee structure differs with the knowledge and methodology of the specialist.

Lets discuss each of the above mentioned fee option briefly.

Commission only

Here, the commission based specialist offers the best financial advice as they are paid only for implementation.

Fee only

Some specialist charge fee for the advice they provide to you either on an hourly basis or on a flat basis.

Fee plus Commissions

Most of the financial planners charge fee and an additional commission also. They charge fee for the advice they give and commission for selling the investment they think is appropriate for us.

Fee in the form of commissions

This is based on compensation method of choice both for planner and the consumer. If the client's investments fall in the value, so does the planner's fee and vice versa.

Fee-offset

The planners who charge this way have a policy to reduce their fee based on whatever they earn from commissions.

Legal Checks

Legal and property matters are complex issues. Though specialists are competent to help to solve these complex matters efficiently, be careful. There are certain particular checks you need to ensure from your side while dealing with a financial specialist.

These are as follows:

1. Other than a specialist fee, a check need not be made payable to the specialist.

2. The client should not lend money to the specialist.

3. Never let a specialist sign your name to a document.

4. A planner should not be allowed to share the profits.

5. Never sign on a blank document if asked by the specialist.

With this information, feel confident to meet a specialist and discuss your financial goals.