Certified Financial Planner (CFP) Exam 2025 – 400 Free Practice Questions to Pass the Exam

A suitable investment must always prioritize the client's best interests, adhering to the fiduciary responsibility of a Certified Financial Planner. An investment made predominantly for commission incentives fails this fundamental principle, as it suggests that the advisor's motivations are financially driven rather than focused on the client’s financial well-being. Such investments can create conflicts of interest, where the advisor's potential earnings dictate the advice given, rather than a genuine alignment with the client's financial objectives.

On the other hand, investments that align with the client’s financial goals, enhance diversification in their portfolio, and offer tax efficiencies demonstrate a commitment to serving the client's interests. These options reflect a thorough evaluation of the client's unique situation and preferences, ensuring that recommendations are tailored to achieve their specific financial aspirations. Thus, any investment motivated primarily by commission incentives is unsuitable when adhering to fiduciary standards in financial planning.