Working with the right financial advisor is the single most important step you can take to ensure retirement success. Yet with so many experts, advisors, and salespeople out there, it’s difficult to know how to find the right person for the job. Zynergy Retirement Planning will break down what you need to know regarding financial planners and give you all the information you will need to make an informed decision when choosing a Certified Financial Planner you’d like to work within Edison, NJ.
What Is A Certified Financial Planner?
A Certified Financial Planner is an expert in financial planning, taxes, insurance, estate planning, and retirement. A CFP is awarded by the Certified Financial Planner Board of Standards, Inc. These individuals have successfully completed the CFP Board’s exams, and in addition, have an educational background to further enhance their knowledge and skills. Becoming a CFP is difficult, and requires years of experience, completion of exams, and a solid education.
The CFP® Candidate must fulfill a 3-year experience requirement, pass a 10-hour exam and uphold an ethics oath before they are eligible to use the CFP® title. To maintain the title, CFPs® must engage in 30 hours of continuing education every two years to keep current with the constant changes in this field. That is why when it comes to working with a professional to plan for retirement, it is important to make sure they are a Certified Financial Planner.
Types of Financial Planners in Edison, New Jersey
The next big decision is what type of Edison financial planner to hire. Among Certified Financial Planners, the industry gold standard, there are three types of compensation models that may affect the type of experience you have:
- A Commission-Based Financial Planner receives 100% of their compensation from commission sales. Their incentive is primarily to sell you one of their products, rather than provide sound financial advice. A simple analogy would be a car salesman at a dealership, who is trying to push you towards an expensive sports car even though you have made it clear you need a family-friendly that meets your budget and safety requirements. The salesman clearly does not have your best interest at heart, and you’ll have a frustrating experience as a result.
- A Fee-Based Financial Planner earns a small fee from their clients in addition to commission sales. This is an effort to get a planner more invested in their client’s success as opposed to getting the sale, but the majority of their compensation is still based on selling products, so there is still a conflict of interest. Imagine another car salesman who points you towards the family car you are looking for, but keeps pushing expensive features you do not want or need.
- A Fee-Only Financial Planner earns 100% of their revenue from their clients. They do not receive any commissions or compensation of any kind on the financial products they recommend. There are far fewer conflicts of interest, and their only goal is their client’s success. In the case of the car dealership, this salesman shows you the car you need, helps you decide which features you need and which you do not, and tells you how you can get the best deal.
Benefits of Choosing an Edison Fee-Only Financial Planner
A Fee-Only CFP® is not only qualified, but they also have your best interest in mind. What exactly is it that makes a fee-only financial planner a better option for most people than the other options? We have three major reasons choosing an Edison fee-only financial planner is in your best interest.
- Fewer conflicts of interest. A fee-only financial planner has no incentive to pitch options or promote funds that would benefit them more than it would benefit their client. While fee-based planners can provide perfectly good service to their clients, it does open up questionable relationships between clients, planners, and investment options. You can avoid any questionable intent by working with a fee-only financial planner.
- The focus is on financial advice. Fee-only financial planners are there to provide the best financial advice, and not try to sell financial products. Providing good advice on where to put your money is good for you, which will end up being good for them too. It’s a win-win situation.
- Percentage-based payment options. Most fee-only financial planners will charge a percentage of the amount of money they manage. Once again, this incentivizes a fee-only financial planner to be as efficient as possible with your money, as the returns will ultimately benefit both parties. If you make money, they make money too.
Make Sure Your Financial Planner is a Fiduciary
On top of choosing a fee-only financial planner, you should also make sure they are a fiduciary. This means they are required to act in the best interest of their client when handling retirement investments. A financial professional who is not a fiduciary has no obligation to put the needs of their clients ahead of their own.
What Can I Expect From A Certified Financial Planner?
It is important for your Certified Financial Planner to get to know you. When you hire a CFP, they will ask a series of questions regarding your personal, professional, and financial life. Your CFP will then explain the process of financial planning and any services that they offer. By the end of your first meeting, you both will have a clear understanding of each other’s responsibilities.
A Certified Financial Planner might request a series of financial documentation, such as:
- Financial statements
- Tax and investment statements
- Insurance policies
- Retirement and employee benefits
- Business documents
- Estate planning documents
The financial planner might also ask questions about your risk tolerance and your current financial and personal phase to develop a better understanding of what steps to take next.
Contact an Edison Retirement Planner Today
If you are living in Edison, NJ, and are near or in retirement, it is important to hire an Edison Certified Financial Planner you can trust. As a fee-only CFP® and fiduciary, we build successful, productive long-term relationships with our clients through unbiased, objective financial advice. Contact Zynergy Retirement Planning today to learn more!
Retirement Planning in Edison, NJ
Edison is a township located in Middlesex County, NJ. Edison lies in the core of the state’s Raritan Valley Region and is part of the New York City Metropolitan area.
The cost of living in Edison can be high, which is why it is important to hire an Edison Certified Financial Planner when considering your retirement.