Finding a financial adviser you trust

Find a financial advisor can be a daunting process. It is not just a numbers game to see who is the best in the face of market

Find a financial advisor can be a daunting process. It is not just a numbers game to see who is the best sailing in the markets. It is a personal relationship, and must find someone who will listen and work with you to help you achieve your goals.

A common misconception is that it is only those people with lots of money to invest need a financial adviser, said Ellen Siegel, a certified financial advisor Miami.

"Everyone needs a mentor, in the same way that we all need to make an annual visit to the doctor," Siegel said. "Everyone needs to be educated on the cash flow, debts, savings, set goals, objectives and retirement planning, asset protection, securities, insurance and planning tax. "

A cheaper alternative is the use of a robotic advisor: a sophisticated computer software to select your investments and balance automatically. pages, the most-Wealthfront, WiseBanyan, Personal Capital and FutureAdvisor offer robotic investment services. Brokerages such as Charles Schwab and Vanguard models also offer IT support.

"The robotic consultants provide automated investment advice, and may have a low cost, but not very personal," says Deanne Butchey, professor at the School of Business at Florida International University. "There are two types of people who can use this service. Someone who is an investment very wise and a lot of research and someone who has a small amount of money and you just want to get in the game, "he said.

A human financial advisor, you can develop a comprehensive financial plan, guide you in terms of money as taxes or insurance, or investment management for you. If you want to do it personally, a counselor can review your investments to make sure it is on track.

Here are some tips to help you find the right financial advisor:

Look professional titles: Anyone can call himself a financial adviser. You can find them in banks, brokerage houses, insurance agencies and independent businesses. But do not confuse a consultant with a seller. The golden rule is a Certified Financial Planner (CFP for short) or a Chartered Financial Consultant (CHFC, for its acronym in English), who have taken courses on various aspects of financial planning. Another appointment to look for is a person who is committed to working with "confidence" which means they have promised to place the client's interests above his own and recommend products that are best for the customer, even if it means earning less. The Financial Planning Association (Financial Planning Association), Onefpa.org, has a list organized by zip code, certified financial planners.

Look what they charge: Some planners charge fees only and does not make money investments they sell. In South Florida, the average hourly rate is between $ 100 and $ 500, said Butchey. Others charge a percent a year for their assets, usually 0.5 to 2.0 percent by management. Some earn commissions based on what you buy. "They may be tempted to rotate or exchange, which means that large commissions for them constantly, but not necessarily the best for you," says Butchey.

The rates should be based on the development of customer needs, said Daniel Elie, certified financial planner Miami, affiliated Garrett Planning Network. "If you are looking for asset allocation, it is simple. If we make a comprehensive financial plan, is a bit more expensive," he said.

Garrett Planning was established to serve investors in middle-income and for those who start. Elie charges fees only: $ 175 per hour or a flat fee per project. (The National Association of Personal Financial Advisors (National Association of Personal Financial Advisors), Napfa.org, has a list, organized by ZIP code, only planners who charge a fee.)

Siegel, scheduler that load fee and also earn money from the sale of investments, costs of $ 400 per hour for her and $ 150 to $ 200 for their main planner.

Many planners have a minimum investment of $ 250,000 on. "They can charge a $ 750 fee for the initial planning of a computer program, up to $ 10,000 for the millions of portfolios," said Siegel.

Some advisors offer a second opinion for investors who do the work themselves, they have their money with cheap brokerages such as Vanguard, Fidelity or T. Rowe Price or have most of the money invested in a 401 (k ). "Since these clients do not have much money to be treated, these people will pay fixed by a year of planning and guiding a tax," he said. These fees can vary from several hundred to several thousand dollars, or one percent of net earnings. The client can return for reassessment if necessary.

Research: Find a place in the network of advisors for information about their specialty, like college or retirement plan and read the biography, said Butchey. Determine how much money you want to invest. Think about how long you have to invest and your goals.

"Prepare to seek and ask questions. Is this a personal relationship," said Elijah. "You need to feel comfortable and you must be able to trust the person who will work with you. "

To begin, make an appointment for an initial consultation with several planners, says Siegel. "Some officials and some do not. Find someone who will listen. Ask about risk tolerance. There must be some sort of tool to help you in the target, as an addition to love talk that helps the planner to assess their tolerance, "he explains. "Addressing how you will be paid."

Be prepared to discuss in the interview. "Bring a list of questions, such as when you visit the doctor," says Butchey. "You want to make sure you find someone with whom you feel comfortable and in turn to answer ease your questions."

Ask about access. "There must be a minimum of one meeting in person per year," says Siegel. "If you are going to be assigned to

Ask for references of clients whose situation is similar to yours. See page CFP Board or Financial Industry Regulatory Authority (Regulatory Authority of the financial industry), Finra.org to know the disciplinary history of illegal or unethical actions.

Above all, it is important that you have good communication with the consultant, he will listen and understand your personal goals, added Butchey.

"A customer must feel comfortable and trust the advice they receive, and if you do not get what you need, you must find another planner"