Professionalism and the Financial Planner

Posted by on Apr 15, 2013 in Articles | 0 comments

Professionalism and the Financial Planner

Financial planning has gone through many changes to date. The question of whether it survives as a profession lies with the people that represent themselves as part of that movement. Their interaction with the public plays an obvious, important role. The development of community perception depends on the individual experiences of people with financial planners.

What types of experiences occur? A lot of good. Take the family that had a very good income, but had absolutely no fiscal responsibility, and that you were able to convert into ardent savers. They became very excited about their lives all over again, when previously they were cynical, even scared, to look into the future. They knew they had a problem with their finances and needed help. At that point, people are very vulnerable and can be taken advantage of easily. You, as a financial planner,literally have the future of this family in your hands, given the complexities that surround the operation of a family’s finances through to retirement.

However, there’s another side as well. There is the professional behavior of the planner when encountering another colleague’s client. What do you do, particularly if the client has a complaint or if he questions your colleague’s opinions, recommendations and strategies. It is impossible to give recommendations without knowing all the facts surrounding a particular individual’s financial affairs. There are also different views as to how to handle a family’s affairs, both right, but different.

Healthy competition is important in every profession, however, an effort to aid each other in improving our practices and techniques needs to be clear. Only this way can we ensure the respect that is necessary in our maturing profession.

Putting together a financial planning practice, with all the proper tools and the training of staff, takes an enormous amount of time, patience and effort. Most of all, it takes money to survive during those lean years and long hours. Certainly, if all of this is true, we need to help each other whenever we can, to succeed. That includes not going after each other’s already established clients by using ill-directed remarks designed to incite the client into believing that the advice of his planner is incorrect.

At times, we all have had clients of other planners come to us because they had concerns about what had been done for them. If we do not know if they have gone to another planner previously, the first question we should ask directly is, “Do you presently or have in the past, worked with any other planner?” The individual’s answer determines the direction of the conversation from that point on.

If the answer is yes, we should ask who their planner is and why they have come to you. Usually, the evidence shows from the conversation that there is a communication gap. They are either very uncomfortable with the investments that they are in, have recently lost some money in an investment or are worried as to whether they are getting the best advice.

What we should try to do in that meeting is explain to them that without a thorough examination of their financial situation, it is difficult to be certain that there is a problem other than the ups and downs of the investment marketplace. We should suggest, finally, that they should go to their planner and explain their concerns. Assure them that by talking with their planner, their concerns can be worked out. The opportunity to prey on peoples fears or the lack of a sensitive ear to one’s colleagues, is not the course of a true professional.

The finality of it all is that on those rare occasions when there is a blatant mishandling of a family’s affairs, then it is the responsibility of every financial planner to report that individual’s activities to the ethics committee.

Therefore, I say to you, my colleagues, let’s expand our cooperative spirit in hope that we will emerge truly as, “The Most Noble Profession Of All!”

Michael Darany is the President of The Consortium Group, a financial planning firm, and is the Symposium Chairman for the South Florida Chapter.

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