Anyone can say, “I’m a financial planner. Here’s how to dig deeper to say what it really means.


There is no shortage of people with awesome job titles who want to help you reach your financial goals. They may be called a financial advisor, financial planner, financial coach, financial advisor, or financial educator.

These people can get certifications from a long list of professional associations, universities and other entities. Look for the string of initials after their name. If you are unsure of the meaning of alphabet letter soup, search the Financial Sector Regulatory Authority (FINRA) website for details.

Just about anyone can set up as a money expert. Barriers to entry vary: Advisors who obtain the Certified Financial Planner (CFP) designation must pass a series of rigorous exams and meet other professional criteria. Others may or may not have such strong credentials to back up their billing.

For consumers looking to hire a financial professional, the cast of characters can get confusing. Definitions tend to get confused. A financial educator, for example, may primarily teach money matters while operating a private practice in parallel – helping clients manage debts, buy a home, or increase their investment knowledge. .

“Some financial educators cater to individuals,” said Vince Shorb, CEO of the National Financial Educators Council, an organization based in Las Vegas, Nevada, which offers a certification program in financial education. They can have a social media presence and invite people to sign up for classes on topics like building wealth or controlling spending. They can also write blogs. self-help books and giving speeches.

The challenge is to identify the value that these professionals provide and whether it is worth the cost. Take a look at their background, education, and compensation structure to understand how they run their business.

Financial advisers (also known as financial planners or wealth managers) typically offer comprehensive financial planning as well as investment management services and products. They can charge a percentage of assets under management, a monthly or quarterly provision or a flat rate. Some earn commissions on the products they sell – and they may require minimal assets to accept new customers.

Some advisers operate independently; others work for a financial services company. In addition to developing a financial plan and managing a client’s investment portfolio, they often take care of retirement planning, tax preparation and estate planning.

Typically, coaches, advisers, and educators do not sell investment products or oversee someone’s portfolio. They could teach people to make informed investment choices so that individuals are better able to decide for themselves how to proceed.

“Financial educators don’t dive into someone’s personal finances,” Shorb said. “It’s more about teaching groups of people” about money.

Shorb’s organization offers the Certified Financial Education Instructor (CFEI) designation, which combines money management principles with the educational skills that practitioners need to lead classes for everyone, from children to children. high school students through to young professionals.

“After getting their financial education, [young professionals] may reach a point where there is a transfer to a financial advisor, ”Shorb said. “This is when they may need to see someone about their investments or a tax professional or an insurer. “

More than 2,000 people have earned the CFEI designation, says Shorb. Unlike the CFP designation (which requires a bachelor’s degree from an accredited college or university as well as some personal financial planning work experience), there are no pre-requisites for applying to become a CFEI. All you need to do is complete 40 hours of lessons and pass an exam.

While financial educators may solicit business from individual clients, they are more likely to work with nonprofits, schools, faith groups, and other organizations. For example, the National Financial Educators Council partners with a minor league basketball group, The Basketball League, to provide financial education to its professional players.

If you are looking for financial advice, note the distinction between counselors and educators. Some financial educators call themselves financial planners, but they will not manage your investment portfolio or process transactions such as stock transactions.

“One thing that financial advisers and educators have in common is helping people achieve their financial goals,” said Lori Hendrickson, who oversees the University of Minnesota Extension’s financial educator certification program. “Our goal is to develop the skills and knowledge of an individual, which can lead to behavior change. A financial advisor would help you strategize to achieve your more specific goals.

Hendrickson, an educator specializing in family resilience, says graduates of the 10-module course receive a certificate from the university, but is not affiliated with other programs.

She adds that some financial educators come into the business to learn from their own struggles. “A lot of people have overcome their own financial problems, like getting out of debt,” she said, “and now they want to share what they’ve learned so others don’t have to go through the same. problems.”

Following: What to watch out for – and watch out for – before giving your money to a financial advisor

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