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Gold Standard Advice – Part 1

I read an interesting Twitter conversation recently. All of the people involved in the conversation were financial advisers and the conversation was essentially focused on what constituted the factors that meant an adviser was most likely to give ‘gold standard’ advice. A few people came to the conclusion that the ‘gold standard’ was an adviser who…

  • Is a Chartered Financial Planner
  • Is a Certified Financial Planner (CFP)
  • Practices ‘Lifestyle Financial Planning’
  • Uses an ‘evidence based’ approach to investment strategies

I am in complete agreement with this sentiment; however, it occurred to me that anyone not in the profession may struggle to define what any of these phrases actually mean and why it matters. As such, over the next few newsletters/blogs I will be explaining each one.

Chartered Financial Planner

Chartered status is awarded by the Chartered Insurance Institute (CII). It is awarded to an individual who…

  • Has completed the Advanced Diploma in Financial Planning;
  • Has 5 years of relevant industry experience;
  • Adheres to the CII code of ethics;
  • Commits to a program of Continuous Professional Development (CPD)

Essentially, what this means is that Chartered Financial Planners have had to pass a set of very rigorous, technical exams on various different areas of financial planning including taxation, trusts, investments and pensions.

In the UK the minimum qualification to provide advice is set at QCA level 4 in the National Qualifications Framework. Chartered Financial Planners have studied to QCA level 6 (roughly equivalent to a university degree). The title is held by roughly 5,300 (as at November 2016) individual advisers in the UK.

Chartered Financial Planners will have a higher degree of technical expertise which is essential to delivering a quality advice service; but that on it’s own doesn’t lead to the ‘gold standard’ in advice.

Next week I will be exploring what being a ‘Certified Financial Planner’ means and why it’s important.