To get a financial planner? How to interview?

I would say do your own research, draw up a plan, and ask for opinions here. You'll get honest advice, and by learning about it on your own you'll be able to come up with a much better plan.

Look at the investment that an average investor is most likely to make money on, then look at the risks. You can pick stocks yourself, but MOST people will do worse than the market (which is why I always suggest index funds, which attempt to do as well as the market).

You could go with bonds, where you generally have less risk, but you get much lower returns.

Or you could go with CDs, where you get a terrible return with almost no risk.

You could also go with real estate, which is a big gamble, but if you buy a place and rent it out, you can definitely come out ahead (especially if you know how to fix things yourself or you're willing to put in the work to keep the place nice and keep your tenants happy).

If retirement is an issue, guesstimate how much money you'll need for retirement, look at the different options (ROTH IRA, IRA, 401k, etc) and read up on the benefits/negatives of each. Then pick the right one, and put in as much money as you need.

If you want more specific advice, you could also post from a dummy account with more specific information about your situation. Then we can give you some options and explain how they'll work for you.

Hope that helps .

Quote from nizzy1115 : Honestly if you are working with a lot of money, you might be best off getting 2, 3 or even more planners and have them work independently for you. It would be easier to spot someone with ill intentions that way.

What if all the planners are equally evil?

Quote from DWad : I would say do your own research, draw up a plan, and ask for opinions here. You'll get honest advice, and by learning about it on your own you'll be able to come up with a much better plan. Look at the investment that an average investor is most likely to make money on, then look at the risks. You can pick stocks yourself, but MOST people will do worse than the market (which is why I always suggest index funds, which attempt to do as well as the market). You could go with bonds, where you generally have less risk, but you get much lower returns. Or you could go with CDs, where you get a terrible return with almost no risk. You could also go with real estate, which is a big gamble, but if you buy a place and rent it out, you can definitely come out ahead (especially if you know how to fix things yourself or you're willing to put in the work to keep the place nice and keep your tenants happy). If retirement is an issue, guesstimate how much money you'll need for retirement, look at the different options (ROTH IRA, IRA, 401k, etc) and read up on the benefits/negatives of each. Then pick the right one, and put in as much money as you need. If you want more specific advice, you could also post from a dummy account with more specific information about your situation. Then we can give you some options and explain how they'll work for you. Hope that helps .

Good advice.

Also visit fatwallet, bogle heads, fool.com and other finance forums, it will educate you more than a financial adviser but its not a substitute.

There is a great read on FW finance regarding CFP - certified financial planner. It may really help you in regards to what to look for in a CFP.

Not sure if I can link here directly. However, go to their finance section and search for
Any CFPs here? How would you/did you get certified? Pros/Cons of the designation/work?
or
DaveHanson

I have a question along those same lines... Would you hire a financial planner without a college degree? He's been in business for over 30 years.

Quote from Lakee911 : I'm thinking of getting a financial plannner, but I'm not really sure how to ... when I meet with one, how do I really interview him/her? What do I look for in one? I know references are one thing. Thx

http://investor.vanguard.com/
+
lawyer and/or CPA


Unless you have millions of dollars it's a complete waste. Educate yourself first and most can be done by yourself. The lawyer and/or CPA can handle more complicated things like trusts, taxes, etc.

Quote from Count_Chocula : I have a question along those same lines... Would you hire a financial planner without a college degree? He's been in business for over 30 years.

He is either completely honest and trusting or he has been living for 30 years off screwing people over. I'm going with the latter.

have any of you heard of Personal Capital and/or use it? i'm looking into it now and have already talk to "my guy" for 1.5 hrs for free. considering using the service but don't know if 0.95% annual fee is worth it.

Quote from darkpope : have any of you heard of Personal Capital and/or use it? i'm looking into it now and have already talk to "my guy" for 1.5 hrs for free. considering using the service but don't know if 0.95% annual fee is worth it.

That's $950 per $100K, every single year. That's just the management fees. Then there's the expense fees, transfer fees, wire fees, statement fees, etc, etc

Enroll in a local university/community college class about finance and do it yourself.

Quote from sd444 : That's $950 per $100K, every single year. That's just the management fees. Then there's the expense fees, transfer fees, wire fees, statement fees, etc, etc Enroll in a local university/community college class about finance and do it yourself.

actually essentially everything you mentioned is included in the 0.95% including all trades. what is not including are things like management fees related to owning shares of ETFs etc.

im just clarifying, not trying to be one-sided. i really dont know what to do.

Quote from darkpope : actually essentially everything you mentioned is included in the 0.95% including all trades. what is not including are things like management fees related to owning shares of ETFs etc. im just clarifying, not trying to be one-sided. i really dont know what to do.

So it's a 0.95% annual fee + management fees. That's a 1% cut, every year.

Go take a free university/cc class + vanguard.org or fidelity.

Quote from darkpope : actually essentially everything you mentioned is included in the 0.95% including all trades. what is not including are things like management fees related to owning shares of ETFs etc. im just clarifying, not trying to be one-sided. i really dont know what to do.

Here is a very good, very easy to understand guide to getting started on investing for your retirement [clarkhoward.com].

Here is another guide [latimes.com] that also does a good job of explaining how to invest for your retirement.

I work for a wealth management firm and I will say there are definitely some good ones out there. I would say that none of them do a good job of managing your expectations, but if they did, they wouldn't have many clients, so we really only have human psychology to thank for that!

Some things to look for:
-NEVER go with a commission based firm. Go with an asset-based fee and both of your interests will be aligned (you make more money, they get a raise).
-Go with an RIA firm. They will be a firm that uses an independent brokerage house for transactions. This way you can see all of your money and all of your transactions at any time (I'm guessing a lot of Bernie Madoff's clients wish they had done this)
-Unlike a comment above, I would recommend going with one, rather than splitting it between multiple advisors. A good advisor will be better able to manage your overall portfolio when they can see your entire picture. This should include tax planning (if you've ever been surprised by your tax bill because of your advisor in April, you're probably not with the right person) and investment planning at an absolute minimum. If you're wealthier, then it should also include estate, insurance, and charitable planning. The company that I work for charges a 1% fee (tiered depending on assets) for all of this.
-If your advisor doesn't tell you about underlying investment costs, find someone else. Many brokers are still putting people into front-loaded funds with 1-2% annual fund fees and their clients just don't know enough to run away. This is a huge drag on your portfolio. Never underestimate the fund expense.
-Your portfolio should be diversified across asset classes and across borders.
-Know the difference between active and passive investing. Active investing is much risker and, mathematically speaking, a long-term losing strategy. That said, while the average person will lose significantly more in an active portfolio, passive investors will never get the best (or the worst) returns in the short-term (by definition, they are always somewhere in the middle before fees and above average after fees)
-If you are only looking for investment management, there are a few websites (they appear reputable, but I have no personal experience) that are very cheap (.25-.30%) and will manage a passive investment portfolio for you.This is, of course, less personal of an investment experience, which is most definitely a negative (obvious reasons that human inputs guided by computers are better than computer input guided by computers).

This is all I can think of off the top of my head. There are plenty of scumbags out there (stay away from publicly traded firms), but there are also plenty of legitimately well-meaning people out there. It's usually easy to spot the difference if you go into the process with a bit of self-education.

Quote from sd444 : So it's a 0.95% annual fee + management fees. That's a 1% cut, every year. Go take a free university/cc class + vanguard.org or fidelity.

Most communitiy college classes about personal finance are taught by outsiders who run financial advisory businesses and are less interested in helping students understand personal finance than in drumming up business from their students. It's not uncommon for such instructors to teach falsehoods ("no-load mutual funds are for sophisticated investors...") and use unconventional terminology in order to confuse students and create a dependency.