NAPFA meaning in Business ?

What is National Association of Personal Financial Advisors mean?

National Association of Personal Financial Advisors (NAPFA) is an American financial planning trade organization created in 1983 to expand the use of fee-only financial advisors by individual consumers. NAPFA established the first set of professional standards for fee-only financial advisors and has updated them to reflect changes in industry practices.

NAPFA members are distinguished from other financial professionals in several ways.

Adherence to a fee-only standard is strict: NAPFA members cannot accept compensation in any form from any source other than their clients. There are no exceptions. NAPFA believes that this minimizes potential conflict of interest between a financial planner and their clients.The fiduciary relationship requires that members always put their clients' interests before their own and that they disclose any potential conflict of interest prior to the client making a decision. This fiduciary standard is in direct opposition to the fiduciary standard by which stockbrokers are held, a standard under which their legal responsibility is to their employer ahead of their client.NAPFA is the only financial planning organization to require a peer review of a candidate member's work output prior to granting membership.Peer review ensures that a NAPFA member has the ability to provide comprehensive financial planning across a wide range of potential client needs—investments, taxes, estate planning, college savings, insurance, long-term care insurance, retirement spending, and more.All new members since 2012 must have the Certified Financial Planner designation.NAPFA has the highest continuing education requirement in the industry, with 60 credit hours required every two years.

The combination of strict fee-only rules and a peer review have kept NAPFA's membership small compared to other professional financial planning organizations. As of December 1, 2018, NAPFA had approximately 3,500 members.

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