Put financial planning on right course

• By Milt x_Zall
• Jun 07, 2002

Working with a financial planner can be an extremely valuable experience for you and your family, but it's important to understand your rights in this professional relationship.

You can take an active role in shaping your financial future when you know your rights and what to expect from your financial planner. Following is a guide:

You have the right to a planner who has integrity.

Trust between you and your financial planner is central to a successful financial planning relationship. You rely on your planner's honesty, professionalism and abilities to achieve your financial and life goals. When you know that your planner takes his or her professional obligations seriously, and places principles over personal gain, you can develop the type of partnership that is crucial to the success of any professional relationship.

You have the right to objective advice.

Your needs should be at the heart of all recommendations made by your financial planner. Your planner should use his or her experience and judgment to carefully consider your situation and provide you with advice that best meets your goals. Sometimes, this objectivity may require the planner to explain that your goals are unrealistic given your current resources and financial commitments. Your planner may then suggest alternative goals or priorities.

You have the right to a planner who is competent.

You have the right to expect your planner to demonstrate an appropriate level of knowledge to offer financial planning advice, such as attainment of the certification as a certified financial planner or chartered financial consultant or certified public accountant with personal financial specialist designations. Your planner should complete continuing education courses as part of his or her ongoing commitment to competency.

You have the right to be treated fairly.

This involves clearly stating what services will be provided and at what price. The planner should also explain the risks associated with his or her financial recommendations and any potential conflicts of interest. For example, does the planner gain personally or financially from your purchase of a particular product or from the outcome of a suggested strategy?'

You have the right to privacy.

To get the best results from your financial planning relationship, you need to divulge relevant personal and financial information to your financial planner on a regular basis. Your planner should keep this information in confidence, only sharing it with others to conduct business on your behalf, at your consent, or when ordered to do so by the courts.

You have the right to a planner who is professional.

Your planner should not provide investment advice or stock brokerage services unless he or she is properly qualified and licensed to do so, as required by state or federal law. If your situation requires expertise that your planner does not possess, he or she should suggest other professionals who may assist you.

You have the right to a planner who is diligent.

Your financial planner should discuss your goals and objectives with you and explain what you can expect from the relationship before engaging you as a client. Once the planner has determined that he or she can assist you and has gathered sufficient information, the planner should make — and, if appropriate, implement — recommendations that are suitable for you. A diligent planner investigates the products or services he or she recommends. A diligent planner also closely supervises any staff working with you.

According to research by the Certified Financial Planner Board of Standards (www.cfp-board.org), more than 40 percent of Americans feel that they are not in control of their finances. If you would like to better manage your financial situation, a professional financial planner may be able to help you.

Zall, Bureaucratus columnist and a retired federal employee, is a freelance writer based in Silver Spring, Md. He specializes in taxes, investing, business and government workplace issues. He is a certified internal auditor and a registered investment adviser. He can be reached at [email protected]