What You Need to Know to Shop for a Financial Planner

Posted on: April 20th, 2010 by

Financial Planner - Rockville, MDWhen shopping for a financial planner, you need to be aware of two misconceptions people have about them.  The first misnomer is that the law requires all financial planners to be registered with a government agency.  It is very important to know that this is far from the truth.  Before deciding on an adviser, always look up the person’s registration at your local state or provincial Business Services Division.  Check to see if there are any complaints or if disciplinary action has been taken against them.  You should also find out how long that person has been in the profession.  A good rule of thumb is to only go with a financial adviser that has been in the business for a minimum of 3-5 years.

The second misconception is that the letters following a person’s name don’t mean much.  This is, again, very much untrue.  When you are looking for an adviser, give extra credit to those who have designations such as Certified Financial Planner (CFP).  To become a CFP, a planner must put in hundreds of hours of studying to pass a grueling 10 hour exam.  Furthermore, members are required to undergo background checks, agree to a code of ethics, and complete continuing education to remain certified.  While hiring a CFP is not a slam dunk for your situation, at least you know that they are legitimate professionals.  Just remember that you need to choose the financial planner that best suits your needs and has passed all of your checks.



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