Money Matters

Where can you get the best advice?

/ 04:39 AM October 15, 2014

Question: I want to consult a financial planner regarding my family’s finances. There seems to be a lot of them out there nowadays, both with certifications and without. How do I know whom to approach?—asked through the “ask a friend, ask Efren” service on www.personalfinance.ph

Answer: The song “What a Wonderful World” as originally sung by Louis Armstrong is probably one of the most played songs on radio and TV because it talks about basic truths about life that span generations.


The lyrics I like best go: “…I hear babies cry, I watch them grow, they’ll learn much more, than I’ll ever know…”

When I was young, I used to look up to my mentors and acknowledged experts at that time. They were the “go to” people then regarding the complex world of investing that seemingly only the rich could reach.


But I also felt that I was the young buck who, together with others of my generation, felt that investing need not be complex and inaccessible to the ordinary Pinoy.

It was in my generation that personal finance for the average Filipino was reborn.

Why reborn? Mutual funds were already in existence in the country in the 1950s. But the lack of regulation and depth in the capital markets led to a lot of wrong practices that brought the industry down and into 30 years of hibernation.

And while the Investment Company Act of 1960 worked to straighten out the industry, the minimum initial investment then of P5,000 was still out of reach of the ordinary person.

Today, the average Pinoy can more easily shell out P5,000 for an initial minimum investment in mutual funds. More important, there are today three options for pooled funds—mutual funds, unit investment trust funds and variable linked insurance.

Today, I see so many young faces in the frontlines of pooled funds in particular and personal finance in general. From sales organizations, to newspapers and magazines and even social media, you see a new generation of individuals armed with the latest technology and strategies. They work more efficiently and effectively in getting people to understand personal finance better and to execute financial strategies with the utmost ease. Truly, they have learned much more than I’ll ever know. And they continue to do so.

It was also only in recent years that certifications cropped up. The growing number of financial planners created the need for differentiation and eventually for globally accredited certifications like the Registered Financial Planner (RFP) and Associate Financial Planner (AFP). Some companies even developed their own programs and certifications.


But training and certification are never enough. The proof of this is that when crises occur, people always go back to the basics. And this is the time when experience is king. This is also why I never let go of what I have learned from my mentors. They have not only been battle scarred, they have also been in much more situations (both good and bad) to know how to handle them more professionally.

But if the requirements for giving good advice are training, certification and experience, do these already place a handicap on the young bucks of today? The answer is of course “no.”

Just like when I was a young buck, all that today’s new generation of financial planners have to do is to partner with those who have the training, certification and/or experience. Training is readily available and so are certifications. It is the experience that is more difficult to acquire.

But falling under the tutelage of the experts allows today’s financial planner to share the experience of such people. It is like getting an instant track record by being associated with an expert or group of experts. And this practice has been going on for many years in consulting firms (e.g. like in the fields of accounting, law, architecture, medicine).

So if you want to get good advice, talk to a financial planner who has experience and the necessary training and certification to back him up. If he does not possess the experience himself, he should be able to rely on the experience of experts he is associated with.

Needless to say, a good financial planner is also one who is dead serious with confidentiality, provides you with the numbers to back up his recommendations, puts his money where his mouth is by giving you written documentation of his advice (i.e. if it is pure advice you are looking for), who does not charge an arm and a leg for his work and opens his lines of communication to you so that you could consult him from time to time regarding his recommendations.

Know more about personal finance by logging on to www.personalfinance.ph. There you will find a wealth of free tools to allow you to hit the ground running with financial planning, whether you are a financial planning client or a financial planner.

(Efren Ll. Cruz is a Registered Financial Planner of RFP Philippines, personal finance coach, seasoned investment adviser and bestselling author. Questions about the article may be sent by SMS to 0917-5050709 or e-mailed to [email protected] To learn more about the RFP program, e-mail [email protected] or text <name><e-mail><RFP> at 0917-3464126 to register.)

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