Anyone in Ontario can call themselves a financial planner or financial adviser, but now, under new rules, those titles will come with additional protections for consumers.
“We are doing this now because there has been uncertainty about who can be a financial advisor and a financial planner,” said Ontario Finance Minister Peter Bethlenfalvy. “This will give consumers confidence that the person giving them advice has the appropriate credentials.”
When it comes to your mortgage, investments, and retirement planning, it can be helpful to do business with a financial professional, as long as you know they’ve taken the appropriate courses and have the knowledge necessary financial resources to give you sound advice.
“The two titles will be financial counselor and financial planner. A financial counselor focuses more on day-to-day money management, and a financial planner helps families and individuals develop long-term financial plans,” said said Bethlenfalvy.
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The Financial Services Regulatory Authority of Ontario (FSRA) said the new rules will clear up confusion for consumers when seeking advice on money matters.
“It’s a huge change that consumers can now rely on these titles and know that these titles really mean something,” said FSRA CEO Mark White.
“The vast majority of financial planners and advisers are competent and well qualified professionals and they have been very supportive of this because they realize that it will only affect people operating at the margins.”
To be able to use both titles, financial advisers and planners will need to have a minimum level of education and be actively supervised by an accreditation body.
They will also be subject to a complaints and discipline process and will have to abide by a code of conduct.
Advocis, an association of financial advisors and planners, believes the changes will benefit the public.
“I think this is a very, very good thing for Ontarians and it will really help them know who they should choose as their financial advisor or their financial planner. It leads to professionalism and consumer confidence,” said Greg Pollock, president of Advocis.
This initiative is to be phased in with a transition period of four years for financial planners and two years for financial advisors.
Many people working in the financial industry may already be qualified for financial advisor or planner positions, but if they don’t, they will have to upgrade their credentials or they won’t be allowed to use these titles in the future.