FPSU Study Guide DEMO

5 / 14

FPSU ® Study Guide
Chapter 1: Financial Planning Process
To be used in conjunction with the money back guaranteed Online FPSU ®
Exam Preparation Tools available at  SeeWhy Financial Learning
4
CHAPTER 1: FINANCIAL PLANNING PROCESS
The History of Financial Planning In Canada
If you were to ask your grandparents how they managed their finances in the 60’s or
earlier you would learn that they visited the bank for banking products, an insurance
agent for insurance needs, a lawyer for legal advice, etc. In other words, the client was
required to work on their own with a number of different professionals. There was no
such thing as a “one-stop-shop” where the client could work with one professional who
would co-ordinate the activities of many professionals.
In the 1970s, the financial world became much more complex as a result of:
• The worst recession in decades
• An oil embargo
• Double digit inflation
• High unemployment
• Increasing personal and corporate tax rates
As a result, the role of “financial planner” was born, but was largely unregulated. Anyone
could call themselves a financial planner regardless of their level of education or
expertise. Only recently has the financial planning industry become regulated.
The Financial Planning Business Today
Financial Advisors
Although clients typically look for financial advisors who are experts when it comes to
investments, a fundamental understanding of how investments work is not sufficient to
help clients achieve their financial goals. In short, the best way to achieve financial
independence is through a sound, all en-compassing financial plan. Financial planning
includes things like:
• Investments • Tax planning
• Estate planning • Protection (insurance)
• Addressing legal concerns • Etc.