Almost anyone can call themselves a financial planner in Canada

A number of financial services organizations have banded together to form the Coalition for Professional Standards for Financial Planners. Essentially, they want to see a standardized set of regulations in place for financial advisors to adhere to if they are to call themselves “financial planners”. Currently, Quebec is the only province that truly requires a recognized financial planning qualification be earned before calling yourself a financial planner, or to say that you offer financial planning services.

I imagine it will be quite some time before anything is enacted that will require all financial advisors who purport to offer financial planning or call themselves financial planners to have earned the proper, recognized credentials. But it’s a step in the right direction, certainly.

Of course, this doesn’t protect you from unscrupulous people. Consider that Earl Jones wasn’t even registered as an advisor, yet he swindled a huge amount of money away from investors. And of course, not all advisors are created equal. A CFP designation is not a rubber stamp for an excellent advisor, but it’s certainly nice to see. Just make sure to check that they actually have a right to use the designation – and you can do so easily by checking out the Financial Planning Standards Council of Canada’s Directory of CFPs in Good Standing.

Preet Banerjee
Preet Banerjee an independent consultant to the financial services industry and a personal finance commentator. You can learn more about Preet at his personal website and you can click here to follow him on Twitter.
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Showing 6 comments
  • Michael James

    I would certainly like to see higher standards set for those who give financial advice, but I would prefer that the focus be on examination of candidates rather than forced attendance in some long program. Knowledgeable financial planners should be allowed to demonstrate their skills quickly rather than have to “pay their dues” with a time-consuming set of courses. The goal should be to increase skill levels rather than to shield existing planners from competition.

    • Preet

      In the past, I’ve wondered about a multi-year program (undergraduate) followed by apprenticeships. There are many people who rely heavily upon advisors, and many of them learn on the job. It’s the nature of the current beast. Much of the skills are soft skills which are hard to teach in school or test on an exam. Of course, I’m not against someone being able to challenge the exams without taking the courses. If you know your stuff, you know your stuff. But I would like to see even those people serve under an experienced advisor first before running solo.

      • Michael James

        I agree that the vast majority of new advisors could benefit from working under an experienced advisor. Failure to learn the soft skills could make it very difficult to get a new practice going. I’m torn on whether such apprenticeship should be mandatory or not. Clearly it should be at least “highly recommended”, but whether it should be mandatory is less clear.

  • dj

    Just because you have letters (an cost to maintane them) after your name does not make you a good IA…IPS and KYA are better at finding Fee based Adviser.

  • Nicky

    It is scary. You really have to make sure someone knows what they are talking about before you take their financial advice!

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