Difference Between Financial Planning and Wealth Management

9,458 views

Published on

Comparision Between CFP and CWM Certification.
Difference between Financial Planning and Wealth Management

Published in: Economy & Finance, Business

Difference Between Financial Planning and Wealth Management

  1. 1. DIFFERENCE BETWEEN FINANCIAL PLANNING AND WEALTH MANAGEMENT Deepak Jain, CFP, CWM
  2. 2. DIFFERENCE BETWEEN CFP AND CWM CERTIFICATIONS Deepak Jain, CFP, CWM
  3. 3. CFPCM and CW ® M Certified Financial Planner Chartered W ealth Manager
  4. 4. Difference Between Financial Planning and W ealth Management Financial Planning   Financial Planning relates to creation and execution of a strategy to achieve a set of financial goals.  Financial Planning is passive management of wealth through asset allocation and risk management. W ealth Management   Wealth Management deals with creation, accumulation, preservation and enjoyment of wealth. Wealth Management involves active management in terms of identifying and taking advantage of opportunities to create and enjoy wealth and can even include sharing of wealth through philanthropy.
  5. 5. Difference Between Financial Planning and W ealth Management Financial Planning   Whereas, Financial Planning is a supportive or auxiliary component that addresses broad goals or issues (e.g. college funding, cash flow modeling, estate tax estimates and funding, spendthrift provisions within a trust, multi-generational family lifestyle funding, etc.)  Financial planning usually means creating a strategy for accumulating wealth for retirement and personal W ealth Management    One way to view Wealth Management, would be as a comprehensive or specific set of plans and strategies designed to manage a set of assets or one large category of assets (e.g. an investment portfolio, closely held business, commercial real estate, etc.) towards specific outcomes. Wealth Management is more comprehensive.
  6. 6. Difference Between Financial Planning and W ealth Management Financial Planning  Financial Planning is the construction of the basic “blueprint” for an individual or family to follow. It will include asset allocation, taxation, cash flow management, a “safety fund”, insurance and basic risk management, and the construction of a foundation estate plan including living documents. W ealth Management   Once an individual accumulates enough wealth, and this is a moving target for each person, they start thinking about Wealth Preservations and Wealth Transfer ,now we are into “Wealth Planning”.  At this wealth “breakpoint”, an individual starts to think differently. They will entertain more advanced strategic ideas to transfer wealth efficiently and minimize
  7. 7. *Areas of Learning Include *In the above representation areas of learning not covered by CFPCM Certification are included and any common area of learning has been Intentionally Excluded
  8. 8. Learning Outcomes of Certifications CW M® Certification CFPCM certification Enter into the spectrum of Wealth Management Products Enter into the spectrum of Financial Planning Products Learn more about Banking, Equity Analysis, PMS, Mutual Fund, Alternate Investment Products, Real Estate, International Taxation, Estate Planning, Insurance, etc. Learn More about Risk management, Retirement Planning, Direct Taxation and Estate Planning. Understand the various Portfolio Management Techniques and Managing Clients Asset Allocation to its optimization Understanding and Applying the financial planning process in the practice of financial planning Start Catering to HNI & UHNI Clients along with your existing clientele Risk and insurance decisions in personal Financial Planning and understand Retirement need analysis techniques Liaising with large corporate clients for debt syndication and structured equity advisory Optimize strategies to make asset management recommendations Building investments proposition for consumer banking domain and creating a Consider potential opportunities & constraints & assess Information to
  9. 9. Universe of Client Handling Based on the Size of Clients’ Portfolio HNI = USD 1 Million UHNI = USD 5
  10. 10. Fast Facts
  11. 11. Basic Certification Differences Parameters CW M® certification CFPCM certification Global Certification Territorial Limitation The certification is awarded directly by the parent body AAFM®, US which makes the CWM® certification truly global and is accepted globally without any territorial limitation. The candidates do not have to undergo any additional certification / examination if he / she want to pursue their career in any other jurisdiction. The certification is awarded by the Indian Chapter i.e. FPSB India which restricts the certification to be global in true sense and is recognized in India only. The candidates will have to undergo additional certification / examination, if he / she want to pursue their career in any other valid country. Career Avenues Analyst, Research, KPO, Banking, Brokerage Firms, Mutual Fund Houses, Private Banking, Wealth Management firms, Financial Planning Outfits, Insurance Companies, Corporate Training, Educational Institutions, Independent Financial Advisory Banking, Mutual Fund Houses, Financial Planning Outfits, Insurance Companies, Corporate Training, Educational Institutions, Independent Financial Advisory Examination There are 2 levels of examinations i.e. Level 1 and Level 2. Online Examination There are five examinations. Online Examination - Daily basis Courseware Qualitative & Standardized Courseware, being provided by AAFM India The courseware is not provided by FPSB India and needs to be developed by EP Experience 3 Years for Experience Pathway No Experience Requirement for Certification 3 Years for Certification
  12. 12. Basic Certification Differences Parameters Pathway to Register CW M® certification CFPCM certification Compulsory Pathway - Eligibility Passed minimum 12th Standard Regular Pathway Passed minimum 10th Standard Experience Pathway - Eligibility Passed Graduation 3 years of minimum work experience. Challenge Status Pathway Candidate must hold a professional qualification 3 years of minimum work experience. Career Avenues Analyst, Research, KPO, Banking, Brokerage Firms, Mutual Fund Houses, Private Banking, Wealth Management firms, Financial Planning Outfits, Insurance Companies, Corporate Training, Educational Institutions, Independent Financial Advisory Banking, Mutual Fund Houses, Financial Planning Outfits, Insurance Companies, Corporate Training, Educational Institutions, Independent Financial Advisory Examination Level 1 examination is of 2 Hour and Level 2 is 3 Hours MCQ Total Cost of Examination – Rs. 4,000/- (Compulsory Path.) Total Cost of Examination – Rs. 2,000/- (Experience Path.) The Exam 1-4 are of 2 Hours each and Exam 5 is of 4 Hours MCQ Total Cost of Examination = Rs. 13,000/- Total cost for Candidate Compulsory Pathway – Rs. 19,000/Experience Pathway – Rs. 12,000/Corporate Pathway- Rs. 9551/- Regular Pathway – Rs. 33,000/Challenge Status Pathway – Rs. 30,000/-
  13. 13. For More Information: Website: www.aafmindia.co.in Tel: 011-45120800

×