Filtering through the Many Different Types of Financial Advisers

NerdWallet.com personal finance columnist Liz Weston gets it right when she advises a reader on the different types of financial advisors out there. The question from the reader is,

Dear Liz: I have met with a financial adviser, but he wants every investment to go through him. Although he is an adviser, he works for a company and wants me to buy their products. I’m a little resistant about this. What’s your advice?

Liz rightly responds by explaining to her reader that,

Anyone can call himself or herself a financial adviser or a financial planner. There are no education, experience or ethics requirements for using those titles. A more accurate job description for this guy might be “product salesman.” He may not charge you upfront, but he’ll make commissions from those products and will recommend them even if there are better, cheaper options available. If you want someone who puts your interests first, look for a fee-only adviser who’s willing to act as a fiduciary. “Fiduciary” means the adviser promises to act in your best interests. And don’t confuse “fee only” with “fee based.” Fee-only advisers are compensated only by their clients. Fee-based advisers may charge their clients while accepting commissions for the products they recommend. You can get referrals to fee-only advisers from the Garrett Planning Network at http://www.garrettplanningnetwork.com and the National Association for Personal Financial Advisors at http://www.napfa.org. If you want someone to give you comprehensive financial planning advice, make sure that he or she has the appropriate credential such as Certified Financial Planner (CFP) or Personal Financial Specialist (PFS) and that you verify the credential with the group that issued it (the CFP Board of Standards for the CFP, and the American Institute of Certified Public Accountants for the PFS).

The key here is to work with someone who has the credentials to do financial planning. The gold standard is a CERTIFIED FINANCIAL PLANNER™️ practitioner and, more specifically, one who is fee-only and has taken an oath to never get paid in the form of commissions, product trails, or any other form of compensation that creates a conflict of interest between the consumer and the advisor. Read more…

 

If you have any questions contact any of our certified fee only financial planners in Denver here at the Dunston Financial Group.

 

 

 

Originally Posted over here: Filtering through the Many Different Types of Financial Advisers

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