A financial adviser or financial planner is a person that offers financial advice to customers based on his or her financial status. In most countries, financial advisers are required to complete certain professional training and obtain registration with a regulatory body to give professional advice. In Canada, professional assistance is usually regulated by the Office of the Superintendent of Financial Services (OSFS). There is also an organization called the Financial Planning Association of Canada (FPA) which is responsible for regulating the professional activities related to financial advice and investing. Other bodies that specialize in other areas of professional expertise are the Canadian Society of Compensation Investors (CSIO), the Financial Planning Association of Canada (FPAC) and the Institute of Chartered Accountants of Canada (ICCA).
Financial advisors offer a wide range of financial advisory services such as estate planning, investing in securities, insurance, pension and retirement planning, asset protection, and money management. They generally offer advice and direction on the purchase and sale of stocks, bonds, options, mutual funds and other securities. Financial planners also help individuals and families plan for the future, help determine the value of insurance premiums and help prepare various retirement plans. Some financial advisors provide direct financial advice through the mail or phone, while others recommend stocks, mutual funds, insurance and investment products.
Most financial advisors have a practice of charging a fee for their advice and service. The fee structure depends on the type of financial advisor and the nature of the services that they provide. Most commissions are fixed and paid annually. Financial advisors can also work as brokers and deal with multiple clients at the same time. However, some brokers will only provide services to registered account holders. In other words, they are only able to advise a client if they have been granted permission by the client.
Financial Advisors must meet a strict legal requirement to take the A+ certification, which are offered by the American Society of Security Dealers (ASD). They are also required to obtain an additional license in the state they operate in to practice law. In addition to their license, many financial advisors have to pass the Certified Fraud Examiner (CFE) examination. CFE exams are nationally recognized by several professional organizations such as the American Bar Association (ABA), the National Association of Securities Dealers (NASD), and the National Futures Association. The National Association of Securities Dealers is one of the largest professional organizations in the United States, employing thousands of people in a wide variety of positions. In order to become a member of the organization, a financial advisor needs to pass all seven of the examinations required by ASDs.
Apart from licenses and certifications, there are several other requirements that must be met by Certified Financial Planners. In order to be a CFP, a financial advisor must meet the following criteria: he or she must have a strong educational background, he or she must have knowledge of all investment securities, he or she must have significant experience in financial advisory activities, he or she must possess a good understanding of money management principles and concepts, and he or she must have sound subject matter knowledge. Many people fail to meet these requirements, and they can be avoided by selecting a CFP who meets the minimum educational and experience requirements but possesses additional qualities that will better suit his or her needs. The most common requirements for CFP status are extensive experience in investment securities and money management, a strong background in law and accounting, and the ability to comprehend and interpret the different legal requirements that accompany each state’s own unique set of rules and regulations. While these requirements are imposed by the different states, all US residents can become certified financial planners.
A good advisor will always provide sound advice in the selection of the appropriate investment products and will follow the recommendations of his or her clients well. Financial advisors need to understand that what they advise their clients about will affect the whole investment portfolio. This includes changing stock portfolios, futures contracts, real estate transactions, and many other financial products. When choosing investment products, financial advisors should use sound money management principles to guide their clients. They should know when to discontinue certain investments and when to make more aggressive moves.