What exactly is a certified financial planner? To fully understand the answer to this question, let’s take a look at the different facets of their duties, education, working environs, and other related job attributes. We begin with clientele and financial goals.
Everyone has major and minor financial goals in mind for their future. Reaching these goals and doing so in a timely manner is the ultimate reward for that person, or, the client. Enter the certified financial planner, or CFP.
The CFP acts much like a personal accountant for the hiring client. They specialize in planning for the individual’s financial futures and helping them obtain specific financial goals along the way. This is done through close and continuous management and analysis of that client’s finances. At times, the CFP may even advise and help the client create suitable goals for their future.
Every operating CFP must have completed a thorough array of background requirements. First, at the very minimum, a Bachelor’s Degree in a related field of study must be obtained. With this degree, the student can then begin CFP certification courses. Each of these courses combine to teach over 100 topics on finances and financial planning.
After obtaining 18 semester credit hours in these courses, the candidate may then take the CFP Board Certification Examination. Preparation for this very important exam involves a great degree of intense course review. In the end however, as stated by the CFP Board itself, “By passing this exam, you demonstrate to the public you have attained a competency level necessary to practice independently as a financial planner”. The financial planner is now certified, and now considered a CFP, ready for business.
A Day in the Life
A day in the life of a CFP may begin with work within the home office. The CFP will have a range of clientele all being simultaneously served by the office. The CFP will begin work on whichever client’s portfolio needs the most immediate attention.
Perhaps Tom needs to save enough for a healthy life after retirement. He only has approximately 10 years left until that day and needs to be prepared. The CFP will first analyze Tom’s entire financial picture, or portfolio, in search of benefits and detractors to this ultimate goal.
Maybe some stock options need to change in order to increase revenue. Maybe Tom has a tax circumstance that is ultimately setting him up for fund-loss in the future. The CFP is there to arrange everything so as to promote the fruition of those ultimate retirement goals.
Having only spent a portion of the day on Tom’s futures, the CFP may then be free to leave the office and do an important house-call for local business owner, Tiffany. Tiffany needs a solid plan for not only retirement, but also for the completion of a land lease she is struggling to pay-off. The CFP may be able to identify a way to relocate Tiffany’s business assets to a venue that will stop monthly costs. With these funds free, further payment toward the land purchase is possible. In the process, the CFP then discovers a tax loophole for the business and the land that will help Tiffany’s future finances tremendously.
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CFP Board for More Info
These are just a few hypothetical examples of the duties and activities of today’s CFP. Keep in mind however, there is plenty more to this career and its responsibilities than this brief rundown can possibly encompass. For more information on the field and work of the certified financial planner, the official CFP Board is the ultimate in authoritative resources.