Definitions and a Pencil

There are other aspects of financial/retirement planning this book won’t address. If you’re confused about what those aspects are, the official definition of financial planning is:

There isn’t one.

Financial planning can be a catchall for a wide array of financial services. To call yourself a “financial planner” may not require any testing or certification—depending on what you do or sell. (Though, under the Dodd-Frank financial reform law, there are some rules that may or may not more strictly define “financial planning.” But like much of Dodd-Frank, the rules remain unwritten thus far.)

Yes, there is certification for financial planners who choose it—like the “certified financial planner” (CFP). And there are professional financial-planning organizations. And if you want to be a financial planner and sell mutual funds or insurance, you must adhere to certification and testing standards for those specific product categories.

In fact, there’s no official definition for what a financial plan is. A financial plan may include things like a budget or maybe some long-range projections based on a variety of assumptions. Or a financial plan might address insurance and estate planning needs. Or there could be some investment advice included. Or not! Or a planner might also be an accountant (whether certified or not) and do taxes. Or . . . or . . . or. . ..

The financial plan is, often, a way for practitioners to get a foot in the door and sell something (or somethings) ...

Get Plan Your Prosperity: The Only Retirement Guide You'll Ever Need, Starting Now--Whether You're 22, 52 or 82 now with the O’Reilly learning platform.

O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.