New rules coming for financial advisors in Ontario. This is what they'll mean for you
Anyone in Ontario can call themselves a financial planner or financial advisor, but now under new rules those titles will come with added protections for consumers.
"We doing this now because there has been uncertainty about who can be a financial advisor and a financial planner," Ontario’s Finance Minister Peter Bethlenfalvy said. “This will give consumers confidence that the person giving them advice has the appropriate credentials.”
When it comes to your mortgage, investments, and planning for your retirement, it can be helpful to deal with a financial professional, as long as you know they have taken the appropriate courses and have the financial background to give you sound advice.
"The two titles will be financial advisor and financial planner. A financial advisor focuses more on day-to-day money management, and a financial planner helps families and individuals develop long term financial plans," Bethlenfalvy said.
The Financial Services Regulatory Authority of Ontario (FSRA) said the new rules will clear up confusion for consumers when they're looking for advice with money matters.
"This is a tremendous change that consumers can now rely on those titles and know that those titles really mean something," said CEO of FSRA Mark White.
"The vast majority of financial planners and advisors are well qualified, good competent professionals and they have been very supportive of this because they realize that this will only affect the people who are operating at the margins."
To be able to use both titles, financial advisors and planners will have to have a minimum standard of education and be actively supervised by a credentialing 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, feels the changes will benefit the public.
"I think this is a very, very good thing for Ontarians and it will really assist them in knowing who they should be choosing to be 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 overtime with a transition period of four years for financial planners and two years for financial advisors.
Many people operating in the financial sector may already qualify for the positions of financial advisor or planner, but if they don't they will need to upgrade their credentials or they won't be allowed to use those titles in the future.
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