THE INITIALS FOR CERTIFIED FINANCIAL PLANNER WERE RENDERED INCORRECTLY IN THE COLOR OF MONEY COLUMN IN SUNDAY'S BUSINESS SECTION. THE COLUMN SHOULD HAVE REFERRED TO THE CFP AND ASSOCIATE CFP. (PUBLISHED 06/29/99)

After reading a recent press release from the Certified Financial Planner Board of Standards, I actually got a bit excited.

The release said the Denver-based professional group had established a new accreditation standard for entry-level financial planners. This would benefit consumers, according to the group, because the new designation will set "threshold-level standards" for professional planners.

It's about time, I thought. It seems to me everybody and their mama is calling themselves a "financial planner" these days. Bankers, brokers, insurance agents and accountants all claim they can help us manage our money. In fact, anybody can call herself a financial planner without any qualifications to speak of.

The stock market and the economy overall have been good to many Americans, and as a result hundreds of companies and thousands of individuals want us to believe we can benefit from the good times, too, if we buy investment products or family financial plans from them.

Financial planners see themselves as the money doctors of our times. Come in and get treated, they beckon, because we have the skills to make you financially healthy or wealthy.

But do they?

I know what makes a good doctor or dentist. My doctor listens to my complaints, then fixes what ails me. My dentist fills my cavities and tries not to put me through too much pain in the process (although I've fondly nicknamed him "Dr. No").

At the very least, medical professionals have the credentials that make me feel comfortable putting my health in their hands. Mostly, you feel confident that they are working in your best interest. But you can't always be so sure about financial planners; it is a title now used by too many financial professionals, many of whom are really salesmen with a particular set of products they want to sell.

Now comes the CFP board, which wants to set a minimum standard with its new accreditation. Anyone getting the board designation would be called an "Associate CFP." The individual has to complete a CFP-accredited training program, take courses covering 25 financial-planning topics, and pass a four-hour exam. They must also agree to abide by the board's code of ethics and get 30 hours of continuing education every two years.

This is a step down from the board's highest-level CFP designation, which requires covering 106 financial-planning topics, including at least 15 semester-hours of college-level courses and a 10-hour, two-day comprehensive exam.

Already some in the industry are calling the board's associate program the "CFP Lite" credential. Critics argue that the lesser certification actually will lower the standard for financial planners, who would otherwise have to go for the tougher CFP designation.

Notwithstanding the criticism, the CFP board president, Bob Goss, said his group just wants to make sure that the people already practicing financial planning have as least some baseline training.

"The CFP board is concerned about the number of people with limited qualifications entering the profession at a faster rate then ever before," said Harold R. Evensky, chair of the CFP board. "This proliferation of unqualified advisers, combined with the lack of standards for delivery of financial planning advice, is not in the best interest of the public or the profession."

How right he is.

I want someone who will look at my financial situation and create a plan that fits my needs. I don't want to worry whether their goal is selling me an investment product that will yield them the highest commission. And I don't want to be sold a one-size-fits-all plan.

Many financial planners are doing right by their customers, I'm sure. The problem is there's no one government-sanctioned standard for the profession.

The government does oversee the actions of people trying to sell us stocks, bonds and mutual funds. And starting next year there will be a new competency exam for investment advisers.

But there still won't be a recognizable set of criteria for the planners who dish out advice on such issues as tax or estate planning, buying insurance, budgeting or retirement planning, Goss said.

Right now the experts tell us consumers to check for credentials.

Oh, sure.

"There is a plethora of credentials," Goss correctly points out.

There is the CFA, and now the associate CFA, the CFP, CFS, ChFC, CLU, CMFC, PFS and RFC. (See the accompanying box if you really want to know what these designations stand for.) All of these credentials are conferred by private organizations with no governmental powers to sanction or remove the bad players.

"The people with these credentials are legitimate only to themselves," said Ric Edelman, a Virginia-based financial planner who holds a CFS, RFC and CMFC. "I think there ought to be at least one universal standard to give financial planners the same credibility that we have in the medical, legal and accounting field."

I couldn't agree more. We certainly wouldn't put up with doctors running around saying they are approved by an alphabet soup of industry groups.

Plethora of Planners

Financial planners may have a variety of credentials. The most common are:

CFA: Chartered financial analyst

CFP: Certified financial planner

CFS: Certified fund specialist

ChFC: Chartered financial consultant

CLU: Chartered life underwriter

CMFC: Chartered mutual fund counselor

PFS: Personal financial specialist

RFC: Registered financial consultant

NOTE: All these designations are awarded by private organizations. While they can suggest that a planner has a certain amount of experience or training, none is required by any federal or state government or regulatory agency.

SOURCE: Edelman Financial Services

Michelle Singletary's column appears in this section every Sunday. While she welcomes comments and column ideas, she cannot offer specific personal financial advice or answer detailed questions about individual situations. Also join her online at 3 p.m. Tuesday at www.washingtonpost.com for a live discussion of this column. Her e-mail address is singletarym@washpost.com. Readers also can write to her at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071.