How to Choose the Best Professional
So you are putting some serious thoughts into personal finance planning! You might be going through a cost cutting spree too! But, if you are going to be guided by these cost cutting resolutions in hiring your personal finance advisor too, then you are going to make a costly mistake. So far as choosing personal finance personnel are concerned, cost effectiveness cannot make any significant difference in your financial achievement. The financial advisors are the professionals who help people manage their money in a more efficient manner. They help to take the concerned person the right decision on saving for both the short and long-term. They help with the investment options including stocks, bonds, mutual funds and other financial programs to invest in. So what matters is the efficiency and professional expertise, an insight about the economy and not how much he or she charges for their consultation.
Now it is not easy to determine whether a financial advisor is right for your particular financial needs. But it is not impossible to find Mr. Right.
To begin with, you have to clearly know for yourself: why do you need a professional to handle your financial planning on your behalf? Maybe you are too bored to deal with the financial issues. Maybe you are too busy with your profession to look into these matters or you are not confident enough to make the decision by yourself. Whatever may be the case, you will be in a better financial position if you employ an expert to look into the matters and straighten the things up for a fee. But how do you know the person has real expertise in the field? Well, there are a number of criteria to assess the credibility of a finance person. Before that, let’s explain the differences in several types of finance professionals.
A Financial Planner will come to your help in making a layout of financial planning and they monitor the performance of the plans too. The Investment Advisor or Money Manager on the other hand would manage your asset portfolios. If you want advices on such things as tax calculation, budget planning, small business finance or long-term income and savings schemes, you have to take the help of Certified Public Accountant (CPA). For buying insurance policies, you have to go to the insurance agents and if you want to get information on stock or bond investments, it is the stock brokers that will come to your assistance.
Before hiring a finance profession, just assess your particular need and choose the type of professional accordingly.
Always look for registered and certified professionals. As for instance, when you are looking for an investment advisor, look for a professional who is registered with the Securities and Exchange Commission. Before entering into business, ask for his or her SEC Form ADV, that reveals the person’s education, business background, fees and mode of operation. Prefer those professionals with such certificates in financial planning like CFP (Certified Financial Planner), ChFC (Chartered Financial Consultant), APFS (Accredited Personal Financial Specialist), etc. Although these certificates are no guarantee of their efficiency, but they at least prove that the person has the theoretical knowledge in the fields of taxes, insurance, investments and estate planning.
Also consider the experience of the professional and in case of finances, more the experience, better the outcome.
It is a good idea to ask for a referral from persons having a similar background as yours. The lists published by Financial Planning Association and National Association of Personal Financial Advisors are also potential source of good financial professionals.