As a norm, most of us grew up thinking higher rank professionals will certainly possess higher qualifications. For example; a doctor would have higher qualification compared to a nurse, professor to have a higher qualification compared to a lecturer and so forth. However, has anyone cracked the fact between fund managers and financial planners?
Confused? Let me break it down for you. The role of a financial planner is to advise and assist clients on their personal financial matters such as planning for retirement, children’s’ education, estate distribution and others. Financial planners have the fiduciary obligation to identify and recommend the most suitable product from the market place to help clients achieve their financial objectives. On the other hand, a fund manager’s role is to manage and invest the public’s money with a sole objective to meet the expected returns based on the investment product profile. He/She is the key person who makes the call on your investment products such as unit trusts, Amanah saham bonds or even the investment portion in your investment-linked insurance policy.
| . | Fund Manager | Financial Planner |
| Hours of Study | 32 hours | 240 hours |
| Ave Duration to Complete Pre-requisite Course | 4 days | 3 years |
| No. of Courses Required | 2 Modules; Module 9 – Funds Management Regulation, Module 10 – Asset and Funds Management | 6 Modules; Module 1 – Foundation in Financial Planning, Module 2 – Risk Management and Insurance Planning, Module 3 – Tax Planning, Module 4 – Investment Planning, Module 5 – Retirement Planning and Estate Planning, Module 6 – Financial Plan Construction and Professional Responsibilities |
| Minimum Qualifications | SPM or Equivalent | SPM or Equivalent |
| Minimum Requirement for CMSRL Applicants | · A degree or professional qualification from an institution recognized by the government of Malaysia · Applicants without any degree or professional qualification must have at least 5 years of relevant experience in the regulated activity | · The Certified Financial Planner (CFP) qualification and a member of the Financial Planning Association of · The Charted Financial Consultant (ChFC) qualification and a member of the Malaysian Association of Chartered Financial Consultant (MAChFC); · The Registered Financial Planner (RFP) qualification and an ordinary member of the Malaysian Financial Planning Council (MFPC) |
| Experience Requirement | 2 years of relevant experience in fund management activity | 3 years in a financial planning-related position |
By now, you must be asking, “why have such stringent requirement to be a financial planner in Malaysia? Why recognized only full CFP, RFP or ChFC qualification to become a financial planner? In other countries such as Singapore, Hong Kong, UK & Australia, the qualification requirement needed for financial planners are much lower in comparison to ours. They just need to sit for one or two exam set by the regulator and can be licensed to advice on those qualified areas.
You can now see why there are only 164 licensed financial planners in Malaysia in the 6 years of issuance. Comparing to our neighboring Singapore, they have licensed 3,500 financial planners in the last 8 years to serve a small population of only 5 million and they don’t have tied agent advising on investments.
Fund managers or even PHDs in finance, with their qualifications & experiences, are not qualified to apply for financial planning license in Malaysia if they do not possess the full CFP, RFP or ChFC qualification. Therefore, it’s safe to conclude that it’s tougher to be a financial planner than to be a fund manager in Malaysia.
To wrap up, both professionals (financial planners and fund managers) plays a very important role for the public. One manages the public’s hard earn money and the other provides professional advise to ensure clients’ financial objectives are met. Therefore, if both are equally important to the nation and society, why should financial planners requires higher entry qualification than a fund manager?
Keep posted on my next issue: What is a wrap account and how can it help you in your investments
