Hiring a financial planner is an expensive, sometimes scary decision. It means looking at yourself in the mirror and finally owning up to the financial problems that have been lingering in the back of your mind. If you decide to hire a financial planner you need to make sure you find one you can trust. That should go without saying, but in the Bernie Madoff era it can’t be stressed enough. You can search for a Certified Financial Planner in your area by visiting www.cfp.net/search, but even if the planner is certified, you’ll still need to do careful screening to make sure he or she is affordable and able to meet your specific needs. Use the questions below to interview candidates and make sure you meet with each one face-to-face. This lets you to see their office, meet their staff and ultimately feel more comfortable with your decision. Be sure to interview at least three financial planners so you can compare their answers and qualifications.
1. What is your educational background?
1a. College degree?
1b. Graduate degree?
2. What are your financial planning credentials/designations and affiliations?
3. How long have you been offering financial planning services?
2a. Less than 2 years
2b. 2 – 5 years
2c. 5 – 10 years
2d. More than 10 years
4. Will you provide references from other professionals?
5. Have you ever been cited by a professional or regulatory body for disciplinary actions?
6. How many clients do you work with?
7. Will you or an associate work with me?
7a. If an associate will be your primary contact, have the associate complete questions 1 – 6.
8. How many meetings will we have per year?
9. What is your method of providing service?
9a. Do you provide a written analysis?
9b. Do you provide recommendations?
9c. Do you assist with implementation of recommendations?
9d. Do you provide ongoing advice?
10. How is your firm compensated and how is your compensation calculated?
10a. Fee only?
10c. Fee + commissions?
11. Are there any financial incentives for you to recommend certain financial products?
12. Do you charge a minimum fee?
What to do if you have concerns about your financial planner:
1. Call your advisor immediately
2. Ask for an in person meeting with your advisor
3. File a formal written complaint if you’re unable to resolve your issues or concerns.
3a. If your advisor is a Registered Investment Advisor (RIA), you can file a complaint with the state securities regulator. The state’s securities administrator can be found at the NASAA website at http://www.nasaa.org/QuickLinks/ContactYourRegulator.cfm.
3b. If the advisor is part of a larger firm, file a complaint with the SEC at http://sec.gov/complaint.shtml.
3c. If your advisor is affiliated with a brokerage firm, file a complaint with the FINRA at http://www.finra.org/Investors/ProtectYourself/p118628
3d. If your advisor is a Certified Financial Planner, file a complaint with the CFP board at http://www.cfp.net/learn/complaint.asp