Everything you need to know about financial planners

Ordinarily, most people can take care of their finances themselves. However, sometimes life puts us into situations where we need help to reach our financial goals. However, according to the survey done by the CFP board, consumers think that it’s easy to manage money while advisors disagree.

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If you were researching financial professionals who can help you with your goals, you probably came across a term called financial planners.

To put it shortly, a financial planner is someone who can help you with your finances. Of course, it’s not that simple.

We’re here to teach you everything you need to know about financial planners. You’ll learn:

  • What does a financial planner do?
  • What are the different types of financial planners?
  • How are you supposed to choose the right financial planner for you?
  • How can you work with a financial planner?
  • How can you own and control your finances?

Hopefully, this article will teach you all you need to know and help you choose the right financial planner to solve any issues with your personal finances.

What does a financial planner do?

First, we need to get acquainted with the term “financial planner.”

A financial planner is a qualified professional who helps you define and reach your financial objectives.

Clients can either have short or long-term goals. Maybe you want to utilize a financial plan to save enough money for your wedding or you want to invest in something bigger, like a new house, for example. They can help you with budgeting or retirement planning regarding your 401k.

The first step is your goal and regardless of what it entails, your financial planner is supposed to provide you counseling and accountability.

When you have a financial goal, your financial planner is supposed to help you define that goal and make a plan for you to follow to meet it. However, this is a collaborative process. You can’t just wait for your new plan to work. You have to provide your planner with all the information and then follow through accordingly.

After giving them information about your assets, financial planners are supposed to analyze your current situation and your goal, after which they’ll make a plan for you. The structure of this plan depends on your objective, but it can be anything from a savings plan for your future home to strategies for debt pay-off. Or they can provide you with advice on which financial product to buy to reach your goals faster.

There are differences in the depths of the plans they’ll create for you. Some may have extensive detail that delves into your finances, savings, investments and so on. Others could make you a plan that focuses on just one or two things.

Some financial planners work with individuals, while some work with corporations. Some are specialists in certain areas, while some are general practitioners.

Since they have so many areas they could work in, there is no central board to regulate all types of financial planners. This is why they’re regulated by the niche they belong to. For example, if an accountant makes financial plans, they’re regulated by the state Board of Accountancy.

Financial planning is a helpful tool to protect your future.

How to become a financial planner

Financial planning is a relatively new term. If you were looking for financial advice a couple of decades ago, you would probably have to get in contact with bankers, an insurance salesperson or a stockbroker.

Every good financial planner has years of education, experience, and training to get to where they are now.

Financial planners need to have at least a bachelor’s degree in a finance-related field, although most financial planners have a Master of Business Administration (MBA). After getting their degree, they can opt for specific certifications to determine their path better.

The best certifications are the Certified Financial Planner (CFP) and Chartered Financial Analyst (CFA). For these, candidates have to get lessons on financial planning through a CFP board registered program. The Certified Financial Planner (CFP) is owned and given by the Certified Financial Planner Board of Standards, Inc.

Experience goes with this certification, as they also need to fulfill 6,000 hours of professional work or 4,000 as an apprentice. After this, they have to take the CFP exam that contains 170 questions and lasts 3 hours, administered by the CFP Board of Standards.

If they want to, they can also get a license, although these aren’t required. Most opt for licenses like Series 6, Series 7 or Series 63 from the Financial Industry Regulatory Authority (FINRA). All in all, it takes continuing education to become a financial planner and to keep this job.

According to the CFP board, there are currently 89,613 practicing CFP professionals, and most of them are between the ages of 40 and 49.

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How much does a financial planner make

According to PayScale, the average base salary of a financial planner in the U.S. is $64,290, in the range between $43,000 and $120,000.

Different financial planners get paid in various sums and different ways. Many Registered Investment Advisors (RIA) are fee-only, getting paid hourly or monthly, but financial planners get paid a couple of ways. Some get paid by getting a percentage of the assets they manage for you, while some earn commissions on transactions they advise you on.

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The difference between a financial planner and a financial advisor

These two terms often get mixed up. Even though the job description is similar, there are some stark differences between the obligations of a personal financial advisor and a financial planner.

They both offer help with your finances, but financial advisors are a more encompassing term where financial planners focus on targeted services, like creating a savings plan for your new house.

To put it simply, a financial planner is a type of financial advisor that can help clients with more comprehensive problems.

Types of financial planners

There are different types of financial planners, primarily based on what niche they focus on. The type of financial planner you should go for depends on your requirements and funds. Here are some types of financial planners you should know about.

Fiduciary financial planner

Fiduciary duty is a requirement for certain professions, like lawyers or financial advisors. A fiduciary is someone who has to put their client first and do everything in their best interest. This means that every solution they offer you has to be the best (and cheapest) option for you, regardless of how big of a commission they can make from it.

Not all planners are fiduciaries. Some are only held by a suitability standard and may not have clients’ best interests in mind.

Fiduciary specifics can vary and have different regulating bodies.

Certified financial planner

A Certified Financial Planner, or a CPF® for short, is a credential that particular financial planners can get through the CFP Board of Standards. As we explained earlier in the article, potential CFPs have to undergo rigorous training and exams to get this title and keep it.

All CFPs have to work as fee-only fiduciaries, and they are considered to be the best ones. Depending on your requirements, they can handle both simple and complicated matters, and you can always check their credentials online.

Investment adviser

An investment adviser’s job is to provide investment advice to companies or individuals and help them with their investment portfolios.

There are two different types of investment advisors, based on whether they’re under a fiduciary duty or not.

The first is the Registered Representatives. Their job is to invest on behalf of their clients, usually through a brokerage company, and many call themselves financial planners or advisors. However, they’re only held to a suitability standard.

On the other hand, Investment Adviser Representatives (IARs) are employed by RIAs and provide financial planning services. They’re held to a fiduciary standard and most have a CFP credential or a similar one.


Robo-advisors are there to give you automated management with pre-built financial plans that fit your requirements the best.

Robo-advisors are held to a fiduciary standard because they are technically RIAs, and they’re getting better and better with their automated financial plans. They offer you a low-cost solution for a minimal fee. This option is excellent for beginners or people with more minor financial issues that need solving.

Wealth manager

Wealth managers are financial planners usually hired by individuals or companies with a high net worth. Wealth management is typically focused on solving problems that affect the rich, like legal planning, estate planning and assets management.

It’s important to note that not all wealth managers are fiduciaries and potential clients should always check their credentials before hiring them.

Online financial planners

In the modern age, we also have online financial planners that can help people. These are a combination of an actual financial planner and a computer program. In most cases, online financial planners work by contacting you via phone or video calls.

Once again, not all online financial planners are fiduciaries and you need to check their credentials before continuing. Their service cost less than a typical financial planner but more than the services of a Robo-advisor.

How to choose the right financial planner

Now that you know all the basic facts about financial planners, it’s time for us to provide you with some advice on choosing one for you.

Do you need a financial planner?

First, ask yourself if you require a financial planner.

Undoubtedly, the services of a financial planner are something that can help everybody, but just because they can help you doesn’t mean you need them. People can solve most financial problems on their own with suitable sources, like adequate financial calculators.

But let’s say your financial situation is more complex. You’re going to need the help of a financial planner if you have goals like saving enough money for significant investments or if your income changed in some ways. For example, you could be getting married, divorced or you have a new baby on the way.

Financial planners can help you define and reach your goals for all of these problems. The more complicated they are, the more likely you’ll need help. According to the survey, 96% of advisors think that the help o a financial planner can aid clients in becoming more confident in secure about their financial futures.

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How to pick the right financial planner

Picking the right financial planner for you isn’t an easy task and should never be done half-heartedly. There are some things that you need to check out before opting for a financial planner.

You shouldn’t be in too much of a hurry. Investigate at least a couple of different financial planners before making your choice. Here are some of the questions you must ask.

Do they work under a fiduciary standard?

First and foremost, you must ask your potential financial advisor about their fiduciary duty. As we mentioned before, if they aren’t fiduciary, they aren’t legally obligated to keep your best interest in mind.

Some financial planners only work under a suitability standard, which means they could offer you plans or financial products that prioritize their gains instead of your own.

What are their credentials?

The second most crucial aspect of choosing a financial planner is their credentials. People can be financial planners even without credentials, but if your potential private finance professional has credentials, they’re most likely severe and better at what they do than others.

Some of the best credentials a financial planner could have include Certified Financial Planner (CFP), Certified Public Accountant (CPA) and a Chartered Financial Analyst (CFA). These are differentiated by what niche they focus on. A CFP generally focuses on your complete financial life. A CPA specializes in tax planning and a CFA works as a financial planner, although primarily for companies rather than individuals. All of these have a CFP® certification.

What service will you exactly get?

Of course, you need to ask your potential financial planner the exact service you’ll be getting as their client. Every financial planner is supposed to provide you with advice and a plan, but there could be other things involved depending on your situation.

Make sure that all expectations are defined before you start working.

Who are their typical clients?

Some financial planners specialize in doctors, lawyers and generally high-income individuals, while some are specialized in working with low-income people. Also, some prefer to work with companies while some work only with individuals.

Ask your potential financial planner what kind of clients they usually work with and see if you fit that mold. The more similar you are to their previous clients, the more likely they’ll have the experience and expertise required to help you.

How can you pay them?

As mentioned earlier, financial planners can get paid in many different ways. Some work on a fee-only basis, where you’ll either need to pay them by the hour, month or even year.

On the other hand, some work on commissions based on the financial products they got you to buy or by the percentage of the assets they manage for you.

Make sure you know how your financial planner wants to be paid and see if that suits you before starting your work with them.

How to work with a financial planner

Different financial planners offer various services. For example, if you opt to work with a Robo-advisor or online planning services, your experience will be different if you worked with a traditional financial planner.

After you already chose which financial planner you’d like to work with, it’s time to get in contact with them. Your first meeting is a place where you’ll get to know each other and define what exactly you’re going to be working on.

Just so you’re ready, here are some of the questions that your financial planner will likely ask you at your first meeting:

  • What is your financial goal?
  • What is the current state of your finances and assets?
  • What is your risk tolerance?

These questions let the planner know your financial picture better to determine your goal and make a plan for it.

Your meetings will depend on you, them and your problems. Some people see their financial planners often, while some don’t. It depends on the situation.

Of course, if your financial status or assets change in any way, you should always let your financial planner know so they can adjust the plan to your best interest.

And last but not least, hiring a financial planner isn’t just a magical solution that will make all of your financial problems go away. This is a collaborative process. You need to provide them with all the information they need and then you have to respect the plan they made and follow through on it.

How to own your finances

Sometimes life puts us in situations where we need help from a professional regarding our finances. But what if we told you that you can learn how to own your finances and get minimum surprises down the line?

We’re going to introduce you to the concept of Infinite Banking.

Infinite Banking can help you secure retirement income and bring you additional benefits. The first step of this method is owning a Whole Life insurance policy. Here are some of the crucial aspects of Whole LIfe insurance and Infinite Banking you should know about.

The concept of Infinite Banking is about strategically using your Whole Life insurance policy from a mutual insurance company as a personal endless banking system. Essentially, Infinite Banking entails being your own banker.

When it comes to the Whole Life insurance policy, it has many benefits. One of them is that policyholders can borrow money using their policy’s cash value. This way, you’ll never have to borrow money from a bank again. Instead, you’ll be borrowing money from yourself and paying back over time, acting as your own banker.

The goal of the Infinite Banking method is to recreate the banking process as much as possible to build the value of your own bank. This process happens by lending and repaying money typically held in the cash value of a permanent life insurance policy.

Infinite Banking let-s you work on your financial goals without anyone’s help or advice. Being your own ban means that no one has any fees or interest you’ll have to pay for their services.

Infinite Banking entails:

  1. Overfunding (with after-tax funds) a high cash value whole life insurance policy from a life insurance company.
  2. Accumulation of Cash Value(tax-free) throughout the years you are a policyholder of your Whole Life insurance policy.
  3. Tax-Free Loans taken out against your whole life insurance policy’s cash value to use for your financial expenses.

The way infinite banking works allows you to mimic the way a bank operates and borrows money.

Instead of borrowing from a bank, you borrow from yourself while still allowing your whole life insurance policy to earn dividends (money) even though you are using that money elsewhere.

Whether it be for your child’s education, a downpayment on the house, or medical expenses, borrowing for yourself and being your own bank allows you the freedom and control of your financial future.

Entering the Banking Business gives you much better control over your finances and helps you build wealth using the life insurance policy.

Final thoughts

Hopefully, we helped you learn all you need to know about financial planners and how to choose the right one for you if you ever need one. Also, we hope that finding out about Whole Life insurance and Infinity Banking made you interested in these concepts and the ways they can help you with owning your finances.

If you want to learn more about Infinite Banking and Whole Life insurance you can sign up for our premium membership! We are looking forward to seeing you at the Wealth Nation community!