About the Financial Planning Profession

Personal financial planning is a fairly new profession to become a career path and type of consultation. With the complexity of changing rules and legislation, an avalanche of companies marketing for your money, and a wealth of financial information available— being able to be wise with your money has become quite a difficult task to manage these days by yourself.

Fortunately there are people who have made the understanding how to manage money wisely their ultimate professional goal. These people are called personal financial planners or financial advisors. However, be on the lookout, as not every financial planner or financial advisor are the same. There are certain levels of credit that should be given to each financial professional and an understanding of the products they offer should be considered.

Different Types of Personal Financial Professionals:

  • Investment Advisor
    • Registered Investment Advisor
    • Registered Representative of a Brokerage Firm or Broker-Dealer
  • Insurance Agent
    • Life & Health Insurance Agent
    • Property & Casualty Insurance Agent
  • Certified Public Accountant (CPA)
  • Estate Attorney
  • Financial Planner
    • Fee-only
    • Fee-based
    • Commission only

I will eventually post what each professional will typically offer for their services and products.

Other Professionals Who Work Along With Personal Financial Professionals

Back Office / Home Office Support Professionals

  • Administrative Assistant
  • Paraplanner
  • Receptionist
  • Compliance Analyst
  • Trading Specialist
  • Home/Back Office Services Representative

Third Party Professionals

There are also other people who may work along with a personal financial professional who are not required to be licensed. These people would include:

  • Lawyers (Other than Estate-Types)
    • Family Attorneys: used during divorces
    • Corporate Attorneys: used during business planning
  • Solicitors (According to the Investment Advisers Act of 1940)

Solicitors are people who sell advisory services for an financial professional or refers clients for a fee. Solicitors may have a deal with a financial professional to bring in clients through their marketing methods, but do not provide the personal financial services. Instead these solicitors are paid a fee for bringing in new business for advisors or planners.

Solicitors and the financial professional working with the solicitor must have both provided a written disclosure to a client defining the name of the solicitor and financial professional, services provided, the nature of the relationship between the two professionals, a statement that the solicitor will be compensated and the agreement of compensation, and the amount the client will be charged in addition to the advisory fee.

Sales, Sales, Sales

Sales is what allows financial professionals to stay in business. Sales should not have a bad connotation behind it. We are involved in sales everyday of our lives: from where we want to eat to where we go for entertainment. Something or someone will sell you on some product to pass your time. The financial services profession has a long history with sales, and there has been a lot of bad history that overshadows and undermines what good this industry provides.

Financial planners and advisers need to provide an argument as to why they would be a good fit for a client's financial team. These professionals need to be able to communicate how their skilled expertise can benefit a client's over financial picture in the long run and not end the relationship just after the sale is made. Then on the flip side, an adviser needs to screen client's for people that fit them. A bad client that takes too much time away for the amount of sales given can be annoying when you have to perform with utmost diligence to every client. So there are cases when an adviser will drop a client to save time and ease the workload.

This makes the profession quite a difficult one. Despite being very knowledgeable and skilled, a person can still fail in the business if he is unable to communicate and market this to the potential clients that he or she wants. The turnover is high for this profession, and only the dedicated are the ones who survive.

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