Home | Financial Page

Suggestions for choosing
a financial planner,
adviser or counselor


by Keith Rawlinson

Volunteer Financial Counselor


There are a lot of people available to assist those with financial questions.  Some are very good at what they do and have special training, but unfortunately some have little or no training and their advice may get you into trouble.  As you talk to various ones, you will find that the opinions, suggestions and advice they each offer can be quite different from one to the next.  Sometimes these differences of opinion can become very confusing to someone trying to find a financial planner, adviser or counselor.  To help sort it all out, here are some practical suggestions for trying to find the financial planner, adviser or counselor who is right for you.

Make sure you see eye to eye
First of all, make sure the financial person you are considering agrees with any strong morel and/or ethical beliefs you may have in your life. For example, if you are a born-again Christian make sure that the financial person you are considering is basing his or her opinions and suggestions on biblical principles.

Do they walk their talk?
Find out if the financial person you are considering is “practicing what they preach.”  In other words, are they applying to their own finances the same suggestions that they are giving you?  Be very, very careful if you are considering someone who tells you to do something different than what they would be willing to do with their own money.

Do you want to be like them?
Find out what their general finances are like.  You may feel that asking is impolite, but it is perfectly acceptable to ask.  In fact, if the financial person you are considering is unwilling to answer questions about their own financial successes or failures, that should immediately put you on your guard. If you are traveling, you would not ask directions to your destination from someone who does not know how to get there themselves; well, the same applies to your finances.  Do not take financial advice from someone unless you would like your finances handled the same way they are handling theirs--there is no way to know that if you do not ask.

A gut feeling
As you talk with a prospective financial person, ask yourself if you feel comfortable with their philosophies about saving, investing, budgeting and spending.  Does what they are saying to you sound right to you?  Do you agree with their perspective on life and finances?  Are their goals for your finances and your future the same as yours?  If you do not have complete peace-of-mind, or if you get a "funny feeling" about doing what they are suggesting, then you should look elsewhere for financial advice.

Mumbo Jumbo?
Can they explain things in a way that you can understand?  It is bad financial planning to invest in things you do not understand.  Do not just take the word of any financial adviser that their ideas about saving and investing are good ones.  Always make them explain things to you.  If you want to follow a particular financial strategy or investment, make sure you completely understand and research it before you put any money into it.  If your adviser cannot make you understand a particular investment or financial strategy, then look for another investment or strategy that you can understand.  If it seems like you never totally understand the strategies and investments suggested by a particular financial adviser, then look for another adviser.

Too risky?
Make sure that you are willing to accept the level of risk your adviser is suggesting.  Too often, financial advisers are willing to take more risks with someone else’s money than they would take with their own. Higher risk investments as a small percentage of  your portfolio is fine, but beware of someone who mostly suggests the highest return investments.  Remember, with the potential for higher return comes higher risk--you could lose everything.

Looking out for themselves instead of for you!
Beware of “churning.”  Churning is when a financial person attempts to generate more commissions for him or herself by buying and selling far too often in your account.  Most good investments need to ‘sit’ for a while.  If your financial person is changing investments more than once or twice per year, or selling most of them in a short amount of time and buying new ones, watch out--they may be churning your account to generate more commissions for themselves.

How much?
Find out ahead of time what the help will cost you. Not just upfront fees, but also commissions, percentages, maintenance costs, interest charges, etc.  If the help is free, then make sure you ask them why and make sure the answer makes good sense.  If the advise is not free and the person is providing their advice for a living, then somewhere along the line they have to be making a profit--make sure you understand how they make their money.  Be sure to shop around to make certain that any fees, expenses or commissions are comparable to what other similar planners, advisers or counselors in your area are charging.  


These are not the only considerations when choosing a financial planner, adviser or counselor; but are very important nonetheless.  If you ignore these suggestions when choosing planners, advisers or counselors, it is very likely that problems will arise later, or that you won't accomplish as much as you could have if you had found the right person for you.  Remember, no one cares about your money as much as you do!



Please know that all of the thoughts, information, suggestions and techniques given on this site are nothing more than the author's opinion on the matter being addressed.  Do further research before making any decisions.

This article copyright 2007 by Keith C. Rawlinson (Eclecticsite.com).  All rights reserved.

This article may be copied for non-profit use including newsletters, bulletins, etc. as long as you
first get written permission from the author and 
full credit is given which includes the author's name
and the name of this website.


Home | Financial Page