The eight course program of study required of a ChFC®
include these topics:
- Financial planning
- Risk management
- Income Tax strategies
- Retirement planning
- Investment strategies
- Estate and gift-tax planning
- Personal financial planning
- Specialized strategies
Working with a ChFC® involves sharing very personal information, so you will want to feel comfortable with the professional you've chosen.
What Is a Chartered Financial Consultant®?
A Chartered Financial
Consultant® or ChFC® is a financial professional who meets
the requirements established by The American College of Financial Services. These include completing
a specified program of study and meeting minimum experience requirements and
specific ethical standards.
What are the requirements?
In order to obtain the ChFC® designation, a number
of requirements must be met. An applicant must:
- Take eight college-level courses and pass an exam for each
- Have at least three years of qualifying full-time work
experience in financial planning or a related field
- Pass a professional fitness standards and background check
To maintain the certification, a ChFC® must meet continuing education requirements.
What does a ChFC® do?
Practitioners with the ChFC® designation are
trained to develop and implement comprehensive financial plans for individuals,
businesses, and organizations. A ChFC® has the knowledge and skills
to objectively assess your current financial status, identify potential problem
areas, and recommend appropriate options. And you're
working with someone who has demonstrated expertise in multiple areas of
financial planning, including income and estate tax, investment planning, risk
management, and retirement planning.
How is a ChFC® compensated?
Typically, financial advisors earn their living either from
commissions or by charging hourly or flat rates for their services. A
ChFC® may use a combination fee-and-commission structure: You pay a fee
for development of a financial plan or for other services provided by the
ChFC® who also receives a commission from selling you products. A
commission is a fee paid whenever someone buys or sells a stock or other
investment. It also is paid when someone buys insurance (such as health, life,
or long-term care insurance) or annuities.
When calculating the cost of working with a ChFC® consider fees, commissions, and related expenses, such as
transaction fees and management fees related to the products recommended.
How can a ChFC® help you?
A ChFC® can help you create a personal budget,
control expenses, and develop and implement plans for retirement, education,
and/or wealth protection. A ChFC® often offers expertise in risk
management, including strategies involving life and long-term care insurance,
health insurance, and liability coverage. A ChFC® often can help with
your tax planning or manage your asset portfolio based on your goals.
Specifically, a ChFC® can help you:
- Establish financial and personal goals and create a plan
to achieve them
- Evaluate your financial well-being with a thorough
analysis of your assets, liabilities, income, taxes, investments, and insurance
- Identify areas of concern and help you address them by
developing and implementing a financial plan that emphasizes your financial
strengths while reducing your financial weaknesses
- Review your plan periodically to accommodate your changing
personal circumstances and financial goals
How to choose a ChFC®
Working with a ChFC® involves sharing very
personal information, so you will want to feel comfortable with the
professional you've chosen. Not only will you want the ChFC® to be
competent, but he or she should also have integrity and a commitment to the
highest ethical standards in the industry. Also, many ChFC® professionals offer
services to a particular clientele, such as small-business owners, corporate
executives, or retirees, so be sure the ChFC® you select works with
people whose interests and goals are similar to yours.
Before you choose a ChFC® to work with, ask
around. You may know a family member, friend, or colleague who has worked with
and recommends a ChFC®. Also, be prepared to interview the
prospective practitioner. If the ChFC® provides investment advice
for a fee, request a copy of Form ADV or the comparable state form. A
ChFC® who offers investment advice is required to file Form ADV with
the U.S. Securities and Exchange Commission (SEC) or with the state of
residence of the ChFC® (although some exceptions apply). Form ADV
contains information about the advisor's education, business, disciplinary
history, services offered, fees charged, and investment strategies. In addition
to Form ADV, ask for the disclosure document that contains other important
information. Even if you don't ask for the
disclosure document, it must be provided to you at the time you enter into an
agreement for services, or soon thereafter. Be sure to read the disclosure
document carefully, as well as any written agreements you enter into.
Here are some questions you may want to ask a
ChFC® to help you find the right planner for you:
- What is your education? What schools did you attend and
what degrees have you earned?
- What licenses do you hold? Are you registered with the
SEC, Financial Industry Regulatory Authority, or the state?
- Are you affiliated with any professional groups or
- Does your practice concentrate in a particular area? What
types of clients do you work with?
- What type of products and services do you offer? Are you
limited as to the types of products and services you can offer me?
- How are you compensated for your services? Do you receive
a commission for products you may sell to me?
- Have you ever been disciplined by any government board or
Is a ChFC® right for you?
The financial world has become a very complex place. Even if
you're used to handling your own financial affairs, the time may be right to
consult a ChFC® who can review your financial health and offer
suggestions that may help you pursue your financial goals.
For example, are you familiar with all the different
investment opportunities that might be available to you? Are you on track to
meet your financial goals such as saving for your child's college education,
securing enough income for a comfortable retirement, or protecting your assets
against risks and lawsuits? A ChFC® can offer the analysis you need
to answer these and other important financial questions pertinent to you.
Keep in mind that there is no assurance that working with a financial professional will improve investment results.