A financial planner is an individual who will help you with your financial plan. The title “financial planner” is not regulated. Anybody can call themselves a financial planner. In fact, many product salespersons call themselves financial planners to add credibility to their sales process. To sell certain financial products (like stocks, mutual funds or insurance), the salesperson must be licensed by the province in which they sell. Many so-called financial planners jump ahead and want to implement your “plan” by selling you their investment product.
At Ron Graham & Associates, we believe you should go through the first four steps of the financial planning process before you buy any investment. We do not sell any financial products; we only provide advice. When it comes to implementing your financial plan, we work with other professionals (accountants, lawyers, investment counselors, investment advisors, bankers and brokers) to find the best solution to suit your needs.
Many people find the world of finance a confusing place.
We provide independent and objective advice to put you on the right track to accomplish your goals. We will confirm whether you are on the right track or tell you what to do to get back on the right track. For many of our clients, we provide peace of mind knowing that they are doing all the right things given their situation.
They can be compensated in one of three ways:
The first is on a fee-only basis. The fee is based on the value of the client’s assets and/or income, or is an hourly rate. We work on a fee-for-service basis charging an hourly fee for the amount of time spent.
The second is on a fee and commission basis. The fee is determined by the amount of work involved in designing the client’s plan and continuous updating. The commissions are derived from the sale of financial products if the client implements the product portion of the plan through the planner.
The third is on a commission-only basis. The commissions are usually derived from the sale of financial products by the planner.
Before choosing a financial planner, it is important that you meet with them to determine how well you get along. Ask about the planner’s background; both education and experience are important. Ask how long the planner has been in the business. Ask for credentials.
The Registered Financial Planner (RFP) designation is awarded to members of the IAFP who have been engaged in the practice of financial planning for a minimum of five years and who have fulfilled satisfactory education requirements. All IAFP members are bound by the Code of Professional Ethics of the Institute of Advanced Financial Planners.
The CFP™ (Certified Financial Planner™) registered certification identifies individuals who are dedicated to a high level of professionalism in providing financial planning advice. The CFP credentials assure you that those using them have agreed to adhere to the highest internationally recognized standards of competence and ethical practice as set out by FP Canada (formerly the Financial Planners Standards Council).
Ask for references. The planner should also be able to show you a sample financial plan. Ask in which areas the planner is knowledgeable. Ideally this should include various areas such as: investments, insurance, business administration, law, money management and taxes. Ask if the planner concentrates on a particular type of client. Ask if the planner would work with you directly or if an associate will handle your account. If you will be working with an associate, ask to meet that person. Ask how the planner keeps clients informed, such as through newsletters or seminars. Ask how often you can expect to meet.
Ask how the planner selects your investment solutions. The planner’s role is to be your guide to financial products. You should be free to implement your plan with the planner or elsewhere. Ask how the planner is compensated. Ask how much you will pay for the planner’s services and ask if the charge is for the plan only or for ongoing service as well.
Ask if the planner is a member of a professional association. If not, why not? Do not hesitate to ask any other questions concerning a planner’s methods, techniques or procedures. After all, you are asking that person to shape your financial future.
Many think financial planning is just the sale of mutual funds or insurance. To some, it means reducing the income tax that they pay. To others, it means getting a better return on their investments.
At Ron Graham & Associates, financial planning is what you do with your money. Every individual who has received money has had to make a decision about the best way to use it. Typically, the decision is either spend it now or save it to spend later. You have to make the same decision every time you receive money. Do you spend it now or save it to spend it later?
Financial planning is a process that you go through to find out where you are now financially, determine where you want to be in the future and what you are going to do to get there. Everybody does financial planning (some are just more successful at it than others).