FPSB's Financial Planner Abilities Financial planning is the process of developing strategies to assist clients in managing their financial affairs to meet life goals. The process of financial planning involves reviewing all relevant aspects of a client’s situation across a large breadth of financial planning activities, including inter-relationships among often conflicting objectives.
FPSB’s Financial Planner Abilities defines the complete set of competencies required of a financial planning professional. The Financial Planner Abilities describes the various tasks that financial planning professionals should be able to carry out during financial planning engagements with clients, regardless of practice type, setting or location. The financial planning professional draws on one or more of the Financial Planner Abilities, in addition to job-related skills, attitudes, judgments and knowledge, to competently deliver financial planning to clients. Regardless of whether the financial planning professional offers comprehensive financial planning or has chosen to limit the scope or level of services (e.g., in one or two components such as Estate Planning or Tax Planning), the financial planning professional needs to be able to master the complete set of abilities required to competently deliver a comprehensive financial plan to a client. Financial planning professionals should master each of the Financial Planner Abilities at an appropriate level, and will likely work with other professionals in evaluating and assessing various aspects of a client’s financial situation (e.g., working with lawyers on estate planning matters, working with accountants on tax planning matters, etc.).
FINANCIAL PLANNER ABILITIES FRAMEWORK Each Financial Planner Ability describes a task that a financial planning professional performs when providing financial planning to a client. While recognizing the integrated nature of the Financial Planner Abilities and that each Ability could appear under multiple categories, for presentation purposes, FPSB has allocated each Financial Planner Ability vertically to one of three Financial Planning Functions (Collection, Analysis and Synthesis) and horizontally to one of six Financial Planning Components (Financial Management, Asset Management, Risk Management, Tax Planning, Retirement Planning and Estate Planning).
FINANCIAL PLANNING FUNCTIONS FPSB has categorized the Financial Planner Abilities into three Financial Planning Functions: Collection
During Collection, the financial planning professional collects the information required to develop a financial plan. Collection goes beyond simply gathering information to also include identifying related facts by making required calculations and arranging client information for analysis. Analysis
During Analysis, the financial planning professional identifies and considers issues, performs financial analysis and assesses the resulting information to be able to develop strategies for the client. Synthesis
During Synthesis, the financial planning professional synthesizes the information to develop and evaluate strategies to create a financial plan.
CORE FINANCIAL PLANNING COMPETENCIES Collection, Analysis and Synthesis can be further defined by Core Financial Planning Competencies.
During Collection, the two Core Financial Planning Competencies are: While each of these Core Financial Planning Competencies has distinct and possibly related Financial Planning Abilities associated with it, both draw on the same Fundamental Financial Planning Practices for the Collection function.
During Analysis, the two Core Financial Planning Competencies are: While each of these Core Financial Planning Competencies also has distinct and possibly related Financial Planner Abilities associated with it, both draw on the same Fundamental Financial Planning Practices for the Analysis function.
During Synthesis, the Core Financial Planning Competency, which draws on the Fundamental Financial Planning Practices for the Synthesis function, is: FUNDAMENTAL FINANCIAL PLANNING PRACTICES The Fundamental Financial Planning Practices represent the competencies that relate to the financial planning professional’s ability to: integrate among the various Core Financial Planning Competencies and Financial Planning Components; and understand and master the interrelationships among the various Financial Planner Abilities required to carry out a Financial Planning Function.
The financial planning professional will use one or more of the Fundamental Financial Planning Practices when providing financial planning to a client.
FINANCIAL PLANNING COMPONENTS FPSB has categorized the Financial Planner Abilities into six Financial Planning Components: Financial management; Asset management; Risk management; Tax planning; Retirement planning; and Estate planning. A financial planning professional does not review tax, asset management or retirement needs in isolation when providing financial planning to a client. Similarly, a financial planning professional will incorporate at least one of the Financial Planner Abilities from a particular Financial Planning Function (e.g. Collection) or Component (e.g. Risk Planning) while working on a related, but separate, Function or area of a client’s financial situation.
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