Certified Financial Planner (CFP) Practice Exam 2025 – All-in-One Study Guide for Exam Success!

A Certified Financial Planner (CFP®) professional is required to uphold the highest ethical standards, which includes managing conflicts of interest transparently. When a CFP® professional foresees a conflict of interest, the best course of action is to provide full disclosure to the client. This means clearly communicating the nature of the conflict, explaining how it may affect the advice or services being provided, and obtaining the client's consent before proceeding with any recommendations or actions that may be influenced by that conflict.

This practice ensures that clients are fully informed and can make decisions based on a complete understanding of the situation. Transparency builds trust and strengthens the client-advisor relationship, which is essential for the integrity of financial planning practices. By obtaining consent, the CFP® professional respects the client's autonomy and right to make informed choices regarding their financial matters.