Financial Planning: Common Ethical Issues

When you’re a financial planner, any one of your actions can create positive or negative consequences for your clients. Some examples of actions that may turn into negative consequences are:

•Putting the financial advisor’s interests before the client;
•Giving out incorrect and misleading information or misinterpreting certain information;
•Pretending to have competence in a particular area;
•Failing to provide different options to the client;
•Misappropriating or losing the money of the client;

Some financial advisors have seen or witness these behaviors from other advisors. Of course, there are still financial advisors who take care of their clients. But there are also those who mislead clients because of their ignorance or worse, for their self-interest.

Professional Ethics For Financial Advisors


As a financial advisor, you need to know the proper ethics when working in this industry. Usually, these ethics are given and studied during your training days as a financial advisor, but recap, here are the professional ethics that financial advisors must have:


As a financial advisor, you should have the professional skills and the knowledge to advise your clients. You should only give services and advice on areas that you know. Only discuss things that you are competent and knowledgeable in.


Another important ethic that every financial advisor should practice is confidentiality. You need to make sure that all of the information given to you by your client will remain confidential no matter what. You are not allowed to disclose any information, especially without your client’s consent.


As a financial advisor, you should take care of yourself, be well informed with the needed skills, and of course, have diligence.


As a financial advisor, you must offer your services fairly and reasonably to your clients and if there are any conflicts of interests you must disclose it to them.


You should also have integrity as a financial advisor and you must avoid unseemly, objectionable, or harmful behavior.


As a financial advisor, you should be objective in offering your services to your clients. The services and products you suggest should meet the needs of your client. Your services must suit their financial capability and be in their best interest.


Lastly, as a financial advisor, you should always act professionally. Your conduct not only reflects on you or your company but to your profession.


After remembering the ethics for financial advisors, you must always behave this way and keep it in mind for the rest of your career. Following these isn’t that hard. Yes, it will take some practice, but having these will benefit you, your client, and your career.

Cover Photo Credit:

Photo Credits:
Blue Diamond Gallery
Pilar Wealth Management