I was recently asked to provide Boston Financial Management’s definition of financial planning for an upcoming speaking engagement. Before dashing off a response, I thought it would be useful to review the websites of the Certified Financial Planner Board of Standards, Inc. and the American Institute of Certified Public Accountants (AICPA).

As a member of these two organizations, I know they establish accreditation and professional standards for a large number of financial planners. The CFP Board, as it is commonly called, grants the CFP® certification and seeks to uphold it as the recognized standard of excellence for competent and ethical personal financial planning. Similarly, the AICPA awards the Personal Financial Specialist credential to the CPA’s that have satisfied additional education, experience and testing requirements. Their guidance provides good background for defining BFM’s approach to financial planning. Per the CFP Board, The Standards of Professional Conduct defines financial planning as “the process of determining whether and how an individual can meet life goals through the proper management of financial resources. Financial planning integrates the financial planning process with the financial planning subject areas.” The AICPA takes a slightly different tack and defines Personal Financial Planning (PFP) as “the process of identifying personal financial goals and resources, designing financial strategies, and making personalized recommendations (whether written or oral) that, when implemented, assist the client in achieving these goals.” While meeting these organizations’ requirements and yet in more practical terms than either group promulgates, Boston Financial Management engages in goals-based personal financial planning. We work with our clients to best plan and achieve successful financial outcomes. The interactive process leads clients through a series of steps designed to optimize the creation, management, preservation and transfer of wealth. They are as follows:

  • Articulate goals, needs and risk tolerance
  • Organize and review important financial and legal records
  • Develop personal statements of net worth with an understanding of each component
  • Evaluate existing plans and products
  • Seek fresh ideas from existing or new specialized professional advisors, including tax, legal, insurance and investment professionals
  • Consider asset allocation options
  • Discuss wealth creation, management, preservation and transfer alternatives
  • Analyze and project cash flows
  • Transform what we learn into a comprehensive financial plan
  • Coordinate the work of specialized advisors in implementing, monitoring and updating the plan.

We seek to minimize the time and cost our clients expend on the management of finances while improving the likelihood of funding all financial goals. As stated above, our singular goal is to improve financial outcomes. In the end, BFM defines financial planning as a thorough, professional and proactive process for clients looking to effectively evaluate, simplify and integrate the prudent stewardship of wealth. Boston Financial Management is a wealth management firm serving individuals, families and endowments. The combination of our independence, transparency, responsiveness, and quality-driven investment orientation results in the outcome we are solely and wholly focused on – your financial well-being.

Please Note: Examples shown are for illustrative purposes only and do not represent the performance of any account, portfolio, composite of accounts or specific recommendation of Boston Financial Management. Your actual performance will vary based on your particular circumstances and should be adjusted to reflect management fees and trading costs. Investment in securities involves risks, including the risk of loss of principal. Past performance is not a guarantee of future returns. IRS Circular 230 Disclosure: Pursuant to IRS Regulations, we inform you that any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax related penalties or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

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