Financial planner

A financial planner or personal financial planner helps others with their financial issues and planning such as retirement, investments and insurance. They strategise according to their clients’ needs.

Financial planners assist people dealing with various personal financial issues. They are specialised in financial planning, such as retirement planning, investment planning, risk management and insurance planning, and tax planning. They advise a strategy tailored to the client’s needs. They ensure the accuracy of bank and other financial records while maintaining a customer-orientated approach and following ethical standards.

Includes wealth advisers

The following job titles also refer to financial planner:

wealth adviser
financial adviser
personal banker
personal financial planner
independent financial adviser
personal financial adviser
financial planning practitioner

Bachelor’s degree is generally required to work as financial planner. However, this requirement may differ in some countries.

ISCO skill level is defined as a function of the complexity and range of tasks and duties to be performed in an occupation. It is measured on a scale from 1 to 4, with 1 the lowest level and 4 the highest, by considering:

• the nature of the work performed in an occupation in relation to the characteristic tasks and duties
• the level of formal education required for competent performance of the tasks and duties involved and
• the amount of informal on-the-job training and/or previous experience in a related occupation required for competent performance of these tasks and duties.

Financial planner is a Skill level 4 occupation.

These occupations, although different, require a lot of knowledge and skills similar to financial planner.

actuarial consultant
corporate banking manager
relationship banking manager
investment adviser
securities analyst

These occupations require some skills and knowledge of financial planner. They also require other skills and knowledge, but at a higher ISCO skill level, meaning these occupations are accessible from a position of financial planner with a significant experience and/or extensive training.

This knowledge should be acquired through learning to fulfill the role of financial planner.

Customer service: Processes and principles related to the customer, client, service user and to personal services; these may include procedures to evaluate customer’s or service user’s satisfaction.
Banking activities: The broad and continuously growing banking activities and financial products managed by banks ranging from personal banking, corporate banking, investment banking, private banking, up to insurance, foreign exchange trading, commodity trading, trading in equities, futures and options trading.
Financial forecasting: The tool used in performing fiscal financial management to identify revenue trends and estimated financial conditions.
Economics: Economic principles and practices, financial and commodity markets, banking and the analysis of financial data.
Financial markets: The financial infrastructure which permits trading securities offered by companies and individuals govern by regulatory financial frameworks.
Modern portfolio theory: The theory of finance that attempts to either maximise the profit of an investment equivalent to the risk taken or to reduce the risk for the expected profit of an investment by judiciously choosing the right combination of financial products.
Investment analysis: The methods and tools for analysis of an investment compared to its potential return. Identification and calculation of profitability ratio and financial indicators in relation to associated risks to guide decision on investment.

These skills are necessary for the role of financial planner.

Assess risks of clients’ assets: Identify, evaluate and determine the actual and potential risks of your clients’ assets, considering confidentiality standards.
Review investment portfolios: Meet with clients to review or update an investment portfolio and provide financial advice on investments.
Create a financial plan: Develop a financial plan according to financial and client regulations, including an investor profile, financial advice, and negotiation and transaction plans.
Synthesise financial information: Collect, revise and put together financial information coming from different sources or departments in order to create a document with unified financial accounts or plans.
Interpret financial statements: Read, understand, and interpret the key lines and indicators in financial statements. Extract the most important information from financial statements depending on the needs and integrate this information in the development of the department’s plans.
Identify customer’s needs: Use appropriate questions and active listening in order to identify customer expectations, desires and requirements according to product and services.
Provide support in financial calculation: Provide colleagues, clients or other parties with financial support for complex files or calculations.
Obtain financial information: Gather information on securities, market conditions, governmental regulations and the financial situation, goals and needs of clients or companies.
Advise on financial matters: Consult, advise, and propose solutions with regards to financial management such as acquiring new assets, incurring in investments, and tax efficiency methods.
Maintain credit history of clients: Create and maintain the credit history of clients with relevant transactions, supporting documents, and details of their financial activities. Keep these documents updated in case of analysis and disclosure.
Analyse the credit history of potential customers: Analyse the payment capacity and credit history of potential customers or business partners.
Apply technical communication skills: Explain technical details to non-technical customers, stakeholders, or any other interested parties in a clear and concise manner.
Budget for financial needs: Observe the status and availability of funds for the smooth running of projects or operations in order to foresee and estimate the quantity of future financial resources.
Offer financial services: Provide a broad range of financial services to clients such as assistance with financial products, financial planning, insurances, money and investment management.
Provide financial product information: Give the customer or client information about financial products, the financial market, insurances, loans or other types of financial data.
Handle financial transactions: Administer currencies, financial exchange activities, deposits as well as company and voucher payments. Prepare and manage guest accounts and take payments by cash, credit card and debit card.

This knowledge is sometimes, but not always, required for the role of financial planner. However, mastering this knowledge allows you to have more opportunities for career development.

Financial products: The different types of instruments that apply to the management of cash flow that are available on the market, such as shares, bonds, options or funds.
Foreign valuta: The currencies of different countries such as the euro, dollar or yen including their exchange rate and the methods of currency conversion.
Financial management: The field of finance that concerns the practical process analysis and tools for designating financial resources. It encompasses the structure of businesses, the investment sources, and the value increase of corporations due to managerial decision-making.
Real estate market: The trends concerning the buying, selling, or renting of property, including the land, buildings, and natural resources encompassed within the property; the categories of residential properties and properties for business purposes which such properties are traded in.
Securities: The financial instruments traded in financial markets representing both the right of property over the owner and at the same time, the obligation of payment over the issuer. The aim of securities which is raising capital and hedging risk in financial markets.
Accounting techniques: The techniques of recording and summarising business and financial transactions and analysing, verifying, and reporting the results.
Types of pensions: The types of monthly sums paid to someone in retirement, such as employment-based pensions, social and state pensions, disability pensions and private pensions.
Mortgage loans: The financial system of acquiring money by property owners or prospective property owners, in which the loan is secured on the property itself so that the property can be repossessed by the lender in the absence of payments due by the borrower.
Principles of insurance: Understand the principles of insurance, including third party liability, stock and facilities.
Debt systems: The processes needed to obtain goods or services before payment and when a sum of money is owed or overdue.
Stock market: The market in which shares of publicly held companies are issued and traded.
Business loans: Loans which are intended for business purposes and which can either be secured or unsecured depending on whether a collatoral is involved. The different types of business loans such as bank loans, mezzanine finance, asset-based finance, and invoice finance.
Tax legislation: Tax legislation applicable to a specific area of specialisation, such as import tax, government tax, etc.
Financial jurisdiction: Financial rules and procedures applicable to a certain location, whose regulatory bodies decide on its jurisdiction
Types of insurance: The various types of risk or loss transfer policies that exist and their characteristics, such as health insurance, car insurance or life insurance.

These skills and competences are sometimes, but not always, required for the role of financial planner. However, mastering these skills and competences allows you to have more opportunities for career development.

Guarantee customer satisfaction: Handle customer expectations in a professional manner, anticipating and addressing their needs and desires. Provide flexible customer service to ensure customer satisfaction and loyalty.
Analyse loans: Examine and analyse the loans provided to organisations and individuals through different forms of credit such as overdraft protection, export packing credit, term loan, and purchase of commercial bills.
Advise on tax planning: Advise on appropriate strategies to include taxes in the overall financial plan in order to reduce the tax load. Advise on questions related to tax legislation and provide advise on the possible implications that decisions in financial matters can cause in a tax declaration.. Advise on questions concerning things such as the creation of a company, investments, recruitments, or company successions.
Protect client interests: Protect the interests and needs of a client by taking necessary actions, and researching all possibilities, to ensure that the client obtains their favoured outcome.
Analyse market financial trends: Monitor and forecast the tendencies of a financial market to move in a particular direction over time.
Assess debtor’s financial situation: Assess the defaulter’s pecuniary circumstances by evaluating the personal income and expenses, and the balance sheet which includes the value of the house, bank account, car and other assets.
Manage pension funds: Manage the sums of money which individuals or organisations pay across a timespan of many years which will ensure they acquire many benefits in retirement. Ensure the amounts paid are correct and that detailed records are kept.
Analyse insurance needs: Gather information about the insurance needs of a client, and give information and advice about all possible insurance options.
Analyse business objectives: Study data according to business strategies and objectives and make both short-term and long-term strategic plans.
Develop investment portfolio: Create an investment portfolio for a customer that includes an insurance policy or multiple policies to cover specific risks, such as financial risks, assistance, reinsurance, industrial risks or natural and technical disasters.
Create banking accounts: Open new banking accounts such as a deposit account, a credit card account or a different type of account offered by a financial institution.

Assist in loan applications: Assist clients with filling out and managing their applications for loans by providing them with practical assistance, such as provision of relevant documentation and instruction on the process, and other advice such as any arguments they could bring forward to the lending organisation in order to secure the loan.
Advise on investment: Assess the customer’s economic goals and advise on the possible financial investments or capital investments to promote wealth creation or safeguarding.
Maintain records of financial transactions: Collate all the financial transactions done in the daily operations of a business and record them in their respective accounts.
Communicate with banking professionals: Communicate with professionals in the field of banking in order to obtain information on a specific financial case or project for personal or business purposes, or on behalf of a client.
Manage financial risk: Predict and manage financial risks, and identify procedures to avoid or minimise their impact.
Analyse financial performance of a company: Based on accounts, records, financial statements and external information of the market, analyse the performance of the company in financial matters in order to identify improvement actions that could increase profit.
Operate financial instruments: Work with financial instruments such as stocks, bonds, mutual funds and derivatives.
Calculate benefits: Calculate the benefits which the people connected to the organisation are entitled to, such as employees or retired people, using the information of the person and the interplay between governmental benefits and benefits obtained through for example employment.
Value properties: Examine and evaluate land and buildings in order to make valuations about their price.
Assist in will writing: Help people to write their will in order to define how assets such as estate, businesses, savings and life insurance are divided after the individual has passed away.
Disseminate information on tax legislation: Provide advise on the possible implications for companies or individuals on decisions regarding tax declaration based on tax legislation. Advise on the favourable tax strategies that could be followed depending on the needs of the client.
Monitor loan portfolio: Control the ongoing credit commitments in order to detect anomalies related to the schedules, refinancing, approval limits etc., and to identify improper disbursements.
Consult credit score: Analyse the credit files of an individual, such as credit reports which outlines a person’s credit history, in order to assess their creditworthiness and all the risks that would be involved in granting a person a loan.
Inform on interest rates: Inform prospective borrowers on the rate at which compensation fees for use of assets, such as borrowed money, is paid to the lender, and at which percentage of the loan the interest stands.
Sell insurance: Sell insurance products and services to customers, such as health, life or car insurance.
Collect financial data: Gather, organise, and combine financial data for their interpretation and analysis in order to predict possible financial scenarios and performance of a company or project.
Analyse financial risk: Identify and analyse risks that could impact an organisation or individual financially, such as credit and market risks, and propose solutions to cover against those risks.
Compose real estate contract: Create a contract between two parties for the purchase, sale or rental of real estate. Make sure the real estate contract and the specifications comply with the legal requirements and are legally enforceable.

2412 – Financial and investment advisers

 

 

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References

1. Financial planner – ESCO