CCM Questions and Answers - Certified Case Manager (CCM) Updated: 2024

In today’s turbulent economy, it’s important to turn to experts for guidance in order to preserve and protect wealth. In celebration of Financial Planning Week®, we had the opportunity to discuss with Marvin W. Tuttle, Jr., CAE, executive director/CEO of the Financial Planning Association® (FPA®), some of the most pressing issues concerning financial planning.

Can I do my own financial planning? What can I expect from a financial planner?

Tuttle: Managing your finances is ultimately your responsibility, but it’s helpful and less taxing when you don’t have to do it alone. A financial planning expert, such as a CERTIFIED FINANCIAL PLANNER™ (CFP®) professional, can help you make decisions that make the most of your financial resources. A financial planner can help you set realistic and personal goals, assess your current financial health, develop a realistic, comprehensive plan to meet your financial goals, and put your plan into action while monitoring its progress. Additionally, a planner can help you stay on track to meet changing goals, circumstances, life stages, products, markets and tax laws.

Everyone has a title or letters after their name —what do they mean?

Tuttle: One thing that seems to perplex consumers is the letters following the names of financial planners. The surprising truth is that anyone can call himself or herself a financial planner without meeting any educational and experience requirements. However, to offer financial services, he or she should be properly licensed in their field that might include a designation such as the CERTIFIED FINANCIAL PLANNER™ certification. The CFP marks help consumers identify financial planners who are committed to competent and ethical behavior when providing financial planning services. CFP practitioners have taken the extra step to demonstrate their professionalism by completing the rigorous CFP certification process. In addition to significant education, ethics and experience requirements, there is comfort in knowing that when working with a CFP practitioner you are the focus of a comprehensive financial planning relationship and your needs drive the financial planner’s recommendations.

How do I find a financial planner and select the one that’s right for me?

Tuttle: Working with a planner is a very personal relationship. In addition to competency, a financial planner should act with integrity, be trustworthy and demonstrate a commitment to ethical behavior and high professional standards. In other words, you want a planner who will put your needs first. Also, many planners specialize in working with certain types of clients, such as small-business owners, executives or retirees. Many also have minimum income and asset requirements, and some specialize in areas of planning such as retirement, divorce or asset management. FPA recommends that you interview at least three planners in person to find the right one to best serve your needs. To locate a CFP professional in your area, call FPA at 800-647-6340 or visit www.PlannerSearch.org.

What is the difference between a CFP® practitioner and a member of the Financial Planning Association® (FPA®)?

Tuttle: FPA supports the standards that are the foundation of CFP certification. They are often referred to in the financial planning profession as the four E’s — examination, education, experience and ethics. Professionals who have earned the CFP certification are required to complete, maintain and comply with the four E’s. They must pass a rigorous 10-hour examination, maintain ongoing continuing education requirements to stay current in order to best serve their clients, meet an initial experience requirement to practice, and subscribe to a code of conduct. They are dedicated to using the financial planning process to serve the financial needs of individuals, families and businesses.
In addition, FPA members demonstrate and support a client-centered financial planning process. FPA’s Standard of Care sets everyday expectations for members who hold out to the public as financial planners, regardless of whether they hold the CFP certification. FPA believes that all financial planning services should be delivered in accordance with the following statements:

— Put the client’s best interests first;
— Act with due care and in utmost good faith;
— Do not mislead clients;
— Provide full and fair disclosure of all material facts; and
— Disclose and fairly manage all material conflicts of interest.

FPA hopes that this standard of care would be embraced by all individuals and organizations that provide financial advisory services to clients and customers.

How should I start looking for a planner, and what information should I ask for when choosing a financial planner?

Tuttle: Ask for names from friends or business associates who may have used a financial planner. Attorneys, accountants, insurance agents, bankers and other financial specialists are also great sources. Additionally, FPA maintains a thorough database of CFP professionals nationwide — visit www.PlannerSearch.org to find a planner in your area. Check with the SEC, appropriate state agencies, your local Better Business Bureau and CFP Board at 888-CFP-Mark (237-6275) to determine if your planner’s record has been tarnished by disciplinary problems or complaints. And, always request a written disclosure document from the planner. This will either be what’s called a Form ADV or an equivalent brochure. This should answer many of your questions. You may then want to follow up with an initial interview, which many planners will do free of charge.

Sample questions to ask:
— What are your areas of specialization?
— What qualifies you in this field?
— How long have you been offering financial planning advice to clients?
— How many clients do you have?
— What are your educational qualifications?
— How are you paid for your services and is any of your compensation based on selling products?
— Do you provide a written client engagement agreement?

Are all financial planners required to be registered with the government?

Tuttle: No. Anyone can claim to be a financial planner. FPA believes Americans are entitled to a clear set of ethical rules governing their professional adviser. FPA supports clear disclosure and high standards of conduct for anyone offering financial planning to the public. That’s why, in 2004, we sued the Securities and Exchange Commission over a loophole that provided an exemption to brokers providing financial advice. This exemption spared brokers the responsibility to be fully transparent to the client. FPA recommends that you ask the following questions when interviewing prospective planners:

— Are you required under law to act as a fiduciary by always placing my interests’ first?
— Are you also a Registered Investment Adviser? If the answer is no, then inquire if he/she is required under law to act as a fiduciary by always placing your interests ahead of their own.
— Regarding any brokerage account
that I may open, what are the potential conflicts of interest that you have when recommending certain products for sale to me, and how will you disclose these to me prior to purchase, including any additional cash payments or incentives that you receive?
— Can you provide me with a written disclosure detailing any disciplinary history for you or your firm?

How are financial planners paid?

Tuttle: Financial planners are compensated through several commonly accepted methods, with set-ups including fee-only, commission-only, combination fee/commission, fee-offset, and salary. Fee-only planners do not receive commissions for the products they sell — fees are solely for the advice they give. Commission-only planners are paid by the companies whose products they sell. Combination fee/commission planners charge a fee for consultation and financial plan preparation, and they may receive commissions from the sale of recommended products. Fee-offset planners receive commissions from the sale of financial products, which are offset against fees charged for the financial planning process. Some planners also work on a salary and bonus basis for financial services firms. Clearly, each method of compensation has its merits, and choosing the appropriate method depends on your individual situation. FPA believes that the planner’s competence and ethical standards should be the primary consideration in your selection process.

How do I know if a planner is truly working in my best interests?

Tuttle: CFP professionals are committed to thinking of their clients’ needs first and foremost. The truth is, however, many individuals who call themselves planners are really in the business of selling investments and/or products. To avoid working with a bogus planner, ask for, and read, a copy of any Code of Ethics, which your planner is required to comply (usually as part of his or her professional designation).

Dear Liz: My sister is married to a man who is considerably older. They’ve been married for eight years. He has cancer and the outlook isn’t good, but he refuses to discuss their financial status. As a result, she has no idea what’s going on. How can she force him to tell her their financial situation? They aren’t getting divorced, and every article I’ve read only addresses financial disclosure in divorce cases. I will probably be the one helping her figure this out after he passes away.

Answer: Refusing to discuss the details of shared finances is at best a form of financial infidelity. A recent NerdWallet survey conducted by the Harris Poll found that many Americans aren’t sharing financial secrets with loved ones, including their income, credit card debt and how much they’ve spent on a purchase.

But at worst, it can be a sign of abuse. If he’s controlling or abusive in other ways, her physical safety may be at risk. Encourage her to call the National Domestic Violence Hotline at (800) 799-7233, which can help her assess her situation and connect her to resources that can help.

Even if she doesn’t plan to divorce, a consultation with a divorce attorney could still help. The attorney could suggest ways to piece together some of the details of their financial life and advise her about state laws regarding shared responsibility for any debts.

Should you close a credit card?

Dear Liz: You recently wrote about how closing credit cards can hurt your credit scores. I’m wondering what impact closing a business credit card would have on my personal credit score.

For many years I have been working in the film industry under contracts with my personal services loan-out company. My company has two credit cards, including a travel rewards card with a hefty annual fee. This card has been useful to me because my job involved a lot of international travel. But as I’m now nearing retirement and traveling less, I’m considering closing that account. Will closing the card affect my personal credit scores?

Answer: The answer lies in your credit reports, which you can view for free at AnnualCreditReport.com. (Type that address into your browser rather than searching for it, because the top results are likely to be sites that want to charge you for credit monitoring. If you’re asked for a credit card, you’re on the wrong site.)

Typically, business cards don’t show up on personal credit reports and thus won’t affect your credit scores. But check to make sure.

Before you actually call to close the card, however, you should know that the company probably will want to keep your business. You may be offered a hefty wad of rewards points as an incentive to keep the account open. The points could be worth enough to offset some or even all of the annual fee.

Also, review all of the benefits the card offers. Many premium cards offer various credits to offset the fee, and not all of them are related to travel. Even if those aren’t enough to entice you to keep the card, you may want to use the credits before shuttering the account for good.

You also may have the option to swap your card for one with a lower annual fee, something known as a “product change,” so you’ll also want to investigate whether one of the issuer’s other cards might be a better fit.

Social Security survivor benefits

Dear Liz: I am trying to understand the Social Security survivor benefit. I delayed starting to receive my benefits until I reached age 70. My wife just started receiving benefits at 66 and 10 months. Upon my passing, will she receive my benefit at full retirement age, plus the 8% annual delayed retirement credit plus the annual cost of living increases?

Answer: Assuming your benefit is larger than hers, then yes — her survivor benefit would be the amount you were getting at your death. The survivor gets the larger of the two checks a couple was receiving, and the other benefit goes away.

Liz Weston, Certified Financial Planner®, is a personal finance columnist for NerdWallet. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the “Contact” form at asklizweston.com.