Financial planners take a broad-based look at a client's financial life and suggest steps and relevant products to help them achieve their financial goals. As of 2010, there is no regulatory body in the U.S. that oversees financial planners, although an October 2009 article in "Investment News" notes that efforts to regulate financial planners have some support from within the industry. Without regulation, becoming a financial planner is as simple as adding the title to your business card; however, to be effective and gain client's trust, financial planners should pursue appropriate education and gain a professional designation.

Education

The Certified Financial Planner Board of Standards defines the financial planning process as having six steps: defining the planner-client relationship; gathering financial data and goals from clients; evaluating client financial status; developing financial plans and recommendations; implementing the recommendations; and monitoring the plan's progress. In utilizing these six steps, financial planners will deal with all aspects of a client's financial life, including investing for major purchases or retirement, estate planning, debt management and tax planning. The "Princeton Review" states that a bachelor's degree in any discipline is helpful for someone who wants to pursue financial planning, but recommends that your degree indicate a skill with numbers in business or science. While no educational requirements exist for someone to call themselves a financial planner, given the range of topics that a financial planner will need to be familiar with, a degree in finance, economics, accounting or statistics would be useful.

Certification

There are 25 designations that have relevance to financial planners; however, the majority of the certifications offer specialization in a topical area, such as taxes, accounting, insurance or estate planning. The Certified Financial Planner designation tests applicants on a broad range of topics. Example topics include ethics; the financial planning process; financial statement and cash flow concepts; financing strategies; education financing solutions; general economic concepts such as supply and demand and economic indicators; business and consumer protection law; financial services regulations; property, casualty, business and life insurance; employee benefits; and income tax and retirement planning. To obtain the Certified Financial Planner designation, you must successfully pass the certification examination, agree to the Certified Financial Planner Board of Standards' Code of Ethical and Professional Responsibility, and within five years from completion of the exam complete a bachelor's degree or equivalent, and obtain three years full-time relevant work experience. Relevant experience is defined by the Board as "the supervision, direct support, teaching or personal delivery of all or part of the personal financial planning process to a client."

Source:

"InvestmentNews:" Bid to Regulate Financial Planning Industry Will Soon Run Into Opposition; 2009

Certified Financial Planner Board of Standards: Financial Planning Process

"The Princeton Review:" Financial Planner

More Information:

Certified Financial Planner Board of Standards: Your Career as a CFP Professional

Financial Planning Association

Financial Planning