| A financial planner can be a great asset, but how do | | | | professional experience in financial planning, and have |
| you know if your planner or advisor is giving you the | | | | passed an additional exam. |
| advice you need? If you are thinking about hiring a | | | | How do they get paid? |
| financial advisor as a step towards a better and more | | | | Financial planners can be paid in one of several ways, |
| stable financial future, it may be difficult to know | | | | and understanding how your planner is paid will offer |
| where to start. Here are some things to look for that | | | | insight into his or her motivations and advice. |
| can help you make the best choice for your situation. | | | | - Flat fees: Usually an hourly rate or a single rate for |
| Are they qualified? | | | | an entire financial plan, this method of payment |
| Many people choose their planner based on a referral | | | | ensures minimal conflict of interest. |
| from a friend or someone at the office. But is that | | | | - Commissions: A common method of payment for |
| planner qualified? Almost anyone can call themselves | | | | planners, they receive a percentage of each |
| a financial planner, so look closely at the qualifications | | | | investment you choose to buy. This is not necessarily |
| of the planners you are considering. Some of the | | | | a bad thing, but can lead to planner bias towards |
| qualifications that indicate a planner who is qualified to | | | | investments that pay them a higher percentage. |
| head your investment and retirement planning include: | | | | - Asset-based fees: This is a relatively new |
| - CFP (Certified Financial Planner): This certification | | | | development in which an annual fee is charged based |
| verifies that this individual has at least a bachelor's | | | | on a percentage of the total amount you have |
| degree as well as additional course training in relevant | | | | invested with that particular planner or firm. |
| areas and has passed a ten hour exam. | | | | Selecting the right financial planner can put you in the |
| - CPA (Certified Public Accountant): Best suited for | | | | optimal position as you head towards retirement, but |
| tax issues, CPAs are experienced accountants held | | | | choosing the wrong one can lead to unnecessary |
| to strict licensing and educational requirements. | | | | complications and headaches. Reputation, |
| - PFS (Personal Finance Specialist): This certification is | | | | qualifications, and an unbiased position will ensure that |
| applied to CPAs who have completed additional | | | | your investments are being handled by a professional |
| educational courses, have at least 3,000 hours of | | | | capable of helping you reach your retirement goals. |