Whether stung by the declining stock market, facing a financial crisis in your life or just wanting to organize your financial affairs, you may need professional financial planning advice. But how do you find the financial planner who is right for you? Here are several tips from the Financial Planning Association (FPA).
Choosing a financial planner is as important as choosing a doctor or lawyer. Money is one of the most intimate aspects of our lives, and, consequently, working with a financial planner is a deeply personal relationship. As you go through the process of finding and selecting a planner, keep in mind that trust and comfort will be key factors.
Before you start your search, think about why you want a financial planner. Do you want advice about investments, retirement planning, health plans, an inheritance, a small business, saving for college, a financial crisis such as a divorce or aging parents, or are you looking for a general financial overhaul? Some planners will be especially strong in one or more of these areas.
Many financial professionals call themselves planners, but in reality their knowledge and focus are limited to a single area, such as selling stocks or annuities, or doing taxes. A financial planner should be educated and trained to address a wide variety of financial issues. Even if your concern is a specific issue, planning should be done in the context of your overall financial situation.
Collect names and information about planners from friends and family, work colleagues and recommendations from other financial professionals such as your attorney or accountant. The Financial Planning Association also can provide names of planners in your area or by specialty through Planner Search, a referralreferral
In some health plans, you must receive a referral from your primary care doctor to see a specialist ... more service.
You can reach Planner Search via the Internet at www.fpanet.org, by calling 1-800-647-6340, e-mailing supportcenter(at)fpanet.org.com, or writing to National Financial Planning Support Center, 5775 Glenridge Dr. NE, Suite B300, Atlanta, GA 30328.
From your initial list of names, call for preliminary information. You may find out right away, for example, that a particular planner requires a minimum net worth that you don't meet. Many planners will have a brochure outlining their services and background, but you'll want to dig deeper than that. Ask for their ADV Form, Parts I and II. The Securities and ExchangeExchange
A new way for people and small businesses to buy health plans. Starting in 2014, state-run exchanges... more Commission requires Form ADV for anyone who is a registered investment adviser (RIA), and anyone calling themselves a financial planner should be an RIA. Part I shows any disciplinary history. Check with the local Better Business Bureau and the Certified Financial Planner Board of Standards 303-830-7500 for disciplinary problems.
Financial planners charge for their services in a variety of ways: by the hour, by a percentage of your assets "under management," by commissions on the products they sell, or a combination. Be clear about how they charge and what services they charge for.
The initial call and literature should help you identify the best candidates. What is their client base - do they work primarily with high income or middle-income clients? Do they have a specialty that matches your needs? Do they serve a lot of business owners, retirees or executives? Are they particularly familiar with stock options?
What financial planning and other financial designations do they hold? What is their educational background and work experience? Are they licensed to sell certain products, such as securities or life insurance? What professional affiliations do they have, such as the Financial Planning Association, which would imply they are keeping up with the ever-changing field of financial planning? What business arrangements do they have that might present a conflict of interest?
Much of the above information you can gather from your referralreferral
In some health plans, you must receive a referral from your primary care doctor to see a specialist ... more source, the initial phone call and the literature. But ultimately, you'll want to narrow your list of candidates to three to five planners and interview them in person. This interview should clarify questions you still have, but more importantly, go to the heart of your initial concern: Do you have a sense of trust and rapport with the planner? Is the person forthright in his or her answers? Do they seem focused on your needs, rather than selling products?
© 2015 Aetna Inc.