financial adviser http://www.wisebread.com/taxonomy/term/18217/all en-US Who to Hire: A Financial Planner or a Financial Adviser? http://www.wisebread.com/who-to-hire-a-financial-planner-or-a-financial-adviser <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/who-to-hire-a-financial-planner-or-a-financial-adviser" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/employees_meeting_work_53155048.jpg" alt="Couple deciding whether to hire a financial planner or adviser" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Armed with Internet access and a DIY attitude, many Americans tackle all kinds of projects on their own to avoid paying a professional. When it comes to managing an investment portfolio, creating a detailed estate plan, or handling the sale of several stock holdings, most of us are better off hiring a financial professional. (See also: <a href="http://www.wisebread.com/4-times-you-should-splurge-and-hire-a-pro?ref=seealso">4 Times You Should Splurge and Hire a Pro</a>)</p> <p>Financial literacy varies across generations. For example, only 24 percent of Millennials and 38% of Gen-Xers in the U.S. are able to answer four out of five <a href="https://www.finra.org/sites/default/files/14_0100%201_IEF_Research%20Report_CEA_3%206%2014%20%28FINAL%29_0_0.pdf">financial quiz questions correctly</a>. While the titles <em>financial adviser</em> and <em>financial planner</em> are often used interchangeably, they're not the same! Let's review the difference between a financial adviser and a financial planner, how you can decide which professional you need.</p> <h2>What Is a Financial Adviser?</h2> <p>In simple terms, a financial adviser helps you manage your money. Since most of the time this means managing your investments, a financial adviser has to complete the <a href="http://www.finra.org/industry/series65">Investment Adviser Law Examination</a> (better known as the Series 65 exam) to legally practice the profession.</p> <p>A financial adviser is a broad title within the financial services industry. To specialize in a field, a professional often completes additional certifications. According to the National Association of Personal Financial Advisers (NAPFA), there are <a href="http://www.napfa.org/UserFiles/File/ConsumerServices/2015%20Pursuit%20of%20a%20Financial%20Advisor%20Field%20Guide%20-%20v2015.pdf">more than 100 professional designations</a> within the industry. Here are three examples of financial advisers:</p> <ul> <li><a href="https://www.niccp.com">Certified College Planning Specialist</a> (CCPS): Presents strategies to finance a college education.<br /> &nbsp;</li> <li><a href="https://www.institutedfa.com/">Certified Divorce Financial Analyst</a> (CDFA): Provides specialized accounting, financial, and legal advice in the field of pre-divorce financial planning.<br /> &nbsp;</li> <li><a href="http://icfs.com/certified_income_specialist">Certified Income Specialist</a> (CIS): Seeks to optimize income from retirement accounts.</li> </ul> <h2>What Is a Financial Planner?</h2> <p>A financial planner is a certified professional uniquely qualified to help individuals pull all their finances together, solve financial problems, and make a plan to achieve their financial goals. This particular type of financial adviser is proficient in the areas of financial planning, taxes, insurance, estate planning, and retirement planning.</p> <p>The most popular credential among financial planners is the <a href="http://www.cfp.net">Certified Financial Planner</a> (CFP), which is a rigorous seven-hour long exam only available a couple times throughout the year. Only individuals who have completed college or university-level coursework in major personal financial planning areas qualify to take the CFP exam. In order to retain CFP status, a professional must also complete continuing education requirements each year.</p> <p>Depending on the work history and preferred area of expertise of the financial planner, he may hold additional designations, such as Chartered Financial Analyst (CFA) and Chartered Financial Consultant (CHFC).</p> <h2>How to Decide What Professional You Need</h2> <p>The main reason why these two titles can be confusing is that every financial planner is also a type of financial adviser, but not every financial adviser is a financial planner. Here are two useful rules to decide which professional to hire.</p> <h3>1. Define the Scope of Your Project</h3> <p>Just like you wouldn't hire an engineer to fix your clogged toilet, you shouldn't hire a full-fledged financial planner to just to buy a couple of bonds. The general rule of thumb is that you should seek the professional who holds the appropriate expertise and qualifications of the services that you require.</p> <p>Consider two scenarios:</p> <ul> <li>A financial adviser focusing on investment management may not be the best match for a client looking for comprehensive estate planning services. A CFP would be more appropriate in this case so that she can structure your finances to meet your financial planning goals.<br /> &nbsp;</li> <li>If you're just trying to decide between several 529 college saving plans, then a CFP may not be necessary and a financial adviser would do.</li> </ul> <h3>2. Decide Whether or Not You Require Fiduciary Duty</h3> <p>Another key criterion to decide between a financial adviser and a financial planner is <em>fiduciary duty</em>. While all financial planners with a CFP designation are legally bound to put their client's interests before their own, not all financial advisers are.</p> <p>Commission-based financial advisers may receive an incentive or kickback for pushing certain products, such as life insurance packages or mutual funds. Check with your prospective financial professional as to whether or not he receives ongoing income from any recommendations or how his fees may affect the success of attaining your financial goals.</p> <p>Fortunately, starting April 10, 2017 <em>all </em>financial advisers handling retirement accounts will be <a href="https://www.dol.gov/ebsa/newsroom/fs-conflict-of-interest.html">required to serve as fiduciaries</a>. Until then, make sure to check for fiduciary duty.</p> <h2>Tips When Choosing a Financial Adviser or Financial Planner</h2> <p>Before you sign a contract, do your homework and determine whether or not your potential financial adviser or financial planner is the most suitable for you.</p> <h3>1. Ask for Credentials and Affiliations</h3> <p>While some salespersons and representatives from insurance and investment companies may appear to provide financial advice and financial planning services, they may have compensation agreements that encourage them to suggest certain investments. Make sure to inquire about the credentials of any financial professional.</p> <h3>2. Verify Credentials and Affiliations</h3> <p>Virtually all governing bodies providing certifications provide a searchable database to look up members. For example, through the <a href="http://www.letsmakeaplan.org/?utm_source=LMAP&amp;utm_medium=header&amp;utm_content=homepage&amp;utm_campaign=header">CFP Board's member database</a> I can see that there are only five CFPs servicing my ZIP code. So, anybody else claiming to be a &quot;financial planner&quot; is lying. Besides confirming credentials, look for any disciplinary action posted on the database. If the professional didn't disclose them in advance, that's a red flag.</p> <h3>3. Review Client Eligibility Requirements</h3> <p>Some financial professionals require you to own a minimum of investable assets. For example, one of the CFPs in my ZIP code requires at least $500,000 in investable assets and another, $2.5 million!</p> <h3>4. Consider Pay Structure</h3> <p>Before entering a contractual relationship with a financial adviser or planner, request a detailed disclosure of all applicable fees. The objective is to spot potential conflicts of interest. Pay close attention to minimum fees for rendered services, commissions from investment products or securities trading, and referral fees from other professionals, such as accountants, insurance agents, and mortgage brokers. (See also: <a href="http://www.wisebread.com/4-sneaky-investment-fees-to-watch-for?ref=seealso">4 Sneaky Investment Fees to Watch For</a>)</p> <h3>5. Ask About Continuity Planning</h3> <p>In other words, &quot;Who would handle my finances if you were to be hit by a bus tomorrow?&quot; After investing so much time in finding the right professional, you don't want to find out that she's retiring next year. Also, inquire if you'll be working with the same financial adviser at all times. If you'll be working with another associate than the one you're interviewing right away or within a few months, request to meet that associate before signing a contract.</p> <h3>6. Inquire If You're the &quot;Typical Client&quot;</h3> <p>You'll get the most out of your financial adviser or financial planner when he's more used to clients at your asset level and financial objective. Working with a &quot;superstar&quot; financial adviser may sound amazing, but may cause a lot of anxiety if you keep being pushed for financial transactions outside your risk tolerance.</p> <h2>The Bottom Line</h2> <p>When deciding on whether to hire a financial planner or financial adviser, ask as many questions as you need to find out if the prospective financial professional is right for you. Finding out as much as possible in advance will allow you to minimize any surprises.</p> <p><em>Have you hired or sought to hire a financial planner or adviser?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/who-to-hire-a-financial-planner-or-a-financial-adviser">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-and-why-to-buy-life-insurance">How (and Why) to Buy Life Insurance</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-personal-finance-skills-everyone-should-master">12 Personal Finance Skills Everyone Should Master</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-financial-gifts-mom-will-love-for-mothers-day">6 Financial Gifts Mom Will Love for Mother&#039;s Day</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-signs-you-need-to-fire-your-financial-planner">9 Signs You Need to Fire Your Financial Planner</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/does-your-net-worth-even-matter">Does Your Net Worth Even Matter?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance financial adviser financial literacy financial planner getting help hiring investments NAPFA professionals Mon, 01 Aug 2016 09:30:34 +0000 Damian Davila 1762105 at http://www.wisebread.com 9 Investing Questions You're Too Embarrassed to Ask http://www.wisebread.com/9-investing-questions-youre-too-embarrassed-to-ask <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-investing-questions-youre-too-embarrassed-to-ask" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_confused_work_000036148092.jpg" alt="Man with investment questions he&#039;s too embarrassed to ask" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You can't build wealth through investing if you never get started. And sometimes, getting started is just a matter of overcoming your fear of asking a stupid question.</p> <p>When it comes to understanding how to buy and sell stocks, invest in a mutual fund, or open a retirement account, it may seem like people are talking a different language. It sometimes feels embarrassing to ask basic questions about investing, but you're not alone in wanting to know how to get started.</p> <p>&quot;I get questions that are very simple,&quot; said Craig Ferrantino of Craig James Financial Services in New York.</p> <p>Ferrantino and other financial advisers say there are no bad questions when it comes to investing, and that your fear of embarrassment should be more than offset by your fear of making money and achieving financial freedom.</p> <p>Here are some common investment questions that you might be too embarrassed to ask (but shouldn't be).</p> <h2>1. I Have Some Money &mdash; What Do I Do With It?</h2> <p>Sometimes, you don't even know where to begin.</p> <p>Chris McMahon, a financial adviser in Pittsburgh, said he advised a man who got a sizable royalty check from a new natural gas operation in Western Pennsylvania. McMahon said the man began with one simple question: &quot;What do I do with the check?&quot;</p> <p>If you're fortunate to have some money that you'd like to invest, simply asking &quot;What now?&quot; is not a dumb question. It's certainly better than doing nothing. If you're in this situation, most financial advisers suggest first assessing whether you have paid off any high-interest debt and have a sizable emergency fund. After that, it makes sense to open an individual retirement account (IRA) and begin making regular deposits, investing primarily in index funds that mirror the performance of the broader stock market. Do this, and you're off to a great start.</p> <h2>2. Okay, But How Do I Open an Account?</h2> <p>A lot of people never get started in investing because they are unfamiliar with the actual mechanics of investing. So understanding how to open a brokerage account and how to buy and sell stocks or mutual funds is crucial.</p> <p>The good news is that it's easier than ever to get started. Anyone can open a brokerage account online at places like Fidelity, E-Trade, or TD Ameritrade. There's plenty of step-by-step advice you can find on these sites, and if you're ever confused, there is usually someone to call.</p> <p>&quot;There are friendly people who are employed to help you with this,&quot; McMahon said.</p> <h2>3. What Is a Stock?</h2> <p>When we first start learning about investing, the lingo and terminology can be confusing. But we're too embarrassed to stop someone mid-conversation and ask them some basic questions. There's no shame in asking people to back up and explain themselves. After all, this is all about you and your financial future.</p> <p>One of the basic concepts in investing is owning shares of stock. In this situation, you literally have an actual share of ownership of a company. So the value of your shares can go up and down just as the value of the company does. This knowledge can serve as the basis for understanding mutual funds and exchange-traded funds, in which money from investors is pooled and then invested a variety of securities.</p> <h2>4. What Is a Bond?</h2> <p>Bonds, like stocks, make up a key component of most investment portfolios. And they are also a big driver of the economy, as companies and governments use them to finance big projects.</p> <p>With bonds, an investor is essentially loaning money to a company or a government. An investor makes money by receiving interest payments from the borrower.</p> <p>So for example, let's say the city of Duluth wants to build a new bridge. The government will issue bonds, which investors can then buy, thus financing the bridge construction. Investors make money on interest from the bonds. Interest rates depend on how likely the company or government is to repay the bonds.</p> <p>Bonds don't increase or decrease in value like stocks, so they are commonly used by older investors who still want some income but have less tolerance for risk.</p> <h2>5. Can I Buy Just a Few Shares?</h2> <p>One of the biggest misconceptions about investing is that you need a lot of money to get started. Thus, people wait too long to get started.</p> <p>Believe it or not, most discount brokerage firms will let you buy just a single share of stock. Don't be embarrassed! A single share of McDonald's stock is going to be worth more in the long run than that quarter pounder you just bought. And while some brokerages do require sizable minimum balances in your account, there are many that don't.</p> <p>There is one important caveat to this, which is that you usually have to pay some fee each time you make a transaction. At discount brokerage firms, this is about $7&ndash;$10. So it does make sense to save up and buy larger quantities of stock if you can, otherwise transaction fees can cut into your returns. To avoid this, explore whether your broker offers some investments without transaction fees. Fidelity, for example, allows customers to trade most iShares ETFs for free.</p> <h2>6. What's the Difference Between a Roth and a Traditional IRA?</h2> <p>We hear these terms thrown around so much that you may feel little dumb for not knowing the answer. But don't. Ferrantino said he gets this question most of all, and he's glad that people ask it.</p> <p>Individual retirement accounts allow people to invest in stocks, bonds, and other securities and see the money grow, without paying a lot of taxes along the way. Individuals can contribute up to $5,500 per year (or more if you're closer to retirement age). With a traditional IRA, the money you deposit is subtracted from your taxable income. (Savings up front!) With a Roth IRA, you pay tax up front but will not have to pay tax on any gains when you withdraw money when you retire. (Savings later!)</p> <p>A financial adviser can help you decide which account is right for you, and may even advise you to have one one of each. Ferrantino said that one you understand the basics of IRAs, you can start to grasp more complex maneuvers, like converting a traditional account into a Roth. So it never hurts to ask.</p> <h2>7. My Company Offers a 401K. What Is It? How Do I Sign Up?</h2> <p>There are many workers who have a vague awareness that their company offers a retirement plan. But they often don't understand how plans work, and are too embarrassed to ask.</p> <p>&quot;The foreign language is scary,&quot; McMahon said.</p> <p>McMahon said the good news is that most companies offer enrollment periods for their retirement plans, where employees can meet with plan representatives and ask any questions.</p> <p>In simple terms, a 401K is a retirement plan that allows workers to set aside a portion of their salary and invest it in a variety of stocks, bonds, and mutual funds. The deposits are subtracted from taxable income, and most companies will match contributions up to a certain level. In other words, your company is <em>giving </em>you free money for signing up. So don't be embarrassed to get the ball rolling!</p> <h2>8. What Is an Asset?</h2> <p>Financial advisers say this question comes up a lot when people are applying for loans. Lenders will often want information on a borrower's &quot;asset-to-debt&quot; ratio. Meaning, how much you own versus how much you owe.</p> <p>Young people, especially, are often baffled by the asset question because they are much more focused on reducing debt. In short, an asset is something that a person or company can own that counts towards their net worth. The equity in your home is an asset. Cash in the bank is an asset. Stocks and bonds are assets. Once you understand the definition of an asset, you can learn about the role they play in building wealth and helping you achieve financial freedom.</p> <h2>9. Do I Need a Financial Adviser?</h2> <p>At what point do you need outside help with your money? Well, that depends on your goals and the complexity of your investment portfolio. But by asking yourself this question, you can at least examine whether your situation would benefit from professional advice.</p> <p>&quot;If you're at a point where you think you need a plan, you probably need somebody,&quot; McMahon said.</p> <p>Of course, financial advisers are biased here. But professionals like McMahon also said that it's easier than ever now for individuals to invest on their own using discount brokerage firms, and get great advice along the way. Sites like Fidelity, Charles Schwab, and E-Trade have a wealth of online tools and people to call if you you have questions.</p> <p>&quot;There are so many resources now, you almost can't screw it up,&quot; McMahon said.</p> <p><em>Got any embarrassing questions? Go ahead and ask!</em></p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F9-investing-questions-youre-too-embarrassed-to-ask&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F9%2520Investing%2520Questions%2520You%2527re%2520Too%2520Embarrassed%2520to%2520Ask.jpg&amp;description=9%20Investing%20Questions%20You're%20Too%20Embarrassed%20to%20Ask"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/9%20Investing%20Questions%20You%27re%20Too%20Embarrassed%20to%20Ask.jpg" alt="9 Investing Questions You're Too Embarrassed to Ask" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/9-investing-questions-youre-too-embarrassed-to-ask">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-trust-your-money-with-these-4-popular-financial-robo-advisers">Should You Trust Your Money With These 4 Popular Financial Robo-Advisers?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cash-might-make-you-happier-but-investments-will-make-you-richer">Cash Might Make You Happier, But Investments Will Make You Richer</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-for-retirement-when-you-are-unemployed">How to Save for Retirement When You Are Unemployed</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-your-house-is-not-an-investment">Stop Thinking of Your House as an Investment</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment basics embarrassed financial adviser stupid questions Tue, 26 Apr 2016 10:30:05 +0000 Tim Lemke 1695513 at http://www.wisebread.com Should You Trust Your Money With These 4 Popular Financial Robo-Advisers? http://www.wisebread.com/should-you-trust-your-money-with-these-4-popular-financial-robo-advisers <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/should-you-trust-your-money-with-these-4-popular-financial-robo-advisers" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000033734768_XXXLarge.jpg" alt="businessman tablet" title="businessman tablet" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Getting good investment advice is no longer a privilege of the filthy rich. The Internet has made readily available the kind of expert, personally tailored investment guidance that was once enjoyed exclusively by the likes of movie stars, monied inheritors, and CEOs. Many of these &quot;robo-advisors&quot; will not only design a personalized portfolio for your specific needs, but they'll even make the trades for you, suggest ways to minimize your taxes, and rebalance your accounts.</p> <p>But with so many web brands peddling low-cost financial advice, it can be hard to figure out where to turn. So we've done the homework for you. Read on for our pick of the top automated investment advisors on the Internet. You can thank us when those big returns start coming in.</p> <h2>1. Betterment</h2> <p>Dubbed &quot;the&nbsp;easiest investment site&nbsp;you'll ever use&quot; by Slate, <a rel="nofollow" href="http://track.flexlinks.com/a.ashx?foid=1029882.679833&amp;fot=9999&amp;foc=1" target="_blank">Betterment</a> clients receive 4.3% better returns on average than a typical DIY investor. CEO Jon Stein said that's why the robo-advising brand has hooked more than 50,000 clients. As Stein told Fox Business, &quot;People come to us and they tell us about their goals and then based on those goals and the time horizon, we create portfolios for them and then manage those portfolios for tax efficiency, we rebalance them automatically, and we do everything that a smart investor should do by using technology.&quot;</p> <p>What sets <a rel="nofollow" href="http://track.flexlinks.com/a.ashx?foid=1029882.679833&amp;fot=9999&amp;foc=1" target="_blank">Betterment</a> apart from other online advisors is something that will appeal to investment newbies: You can open an account with Betterment even if you have no money. However, the company recommends a monthly deposit of $100, which is just enough to waive the $3 fee per month for accounts less than $10,000.</p> <h2>2. Wealthfront</h2> <p><a href="http://wealthfront.evyy.net/c/27771/173024/3104">Wealthfront</a> was built on the principle that you don't need a lot of money to reap big benefits from the world of investment. Free for accounts totaling $10,000 or less, this automated investment service is one of the largest, claiming over $1.5 billion in client assets.</p> <p>Aside from its free-of-charge service offer for smaller accounts (accounts larger than $10,000 are billed an annual fee of .25%), what sets Wealthfront apart from other online advisors is its stable of world-class financial experts. Working under the leadership of Burton Malkiel, a renowned economist who helped trail-blaze the low-cost investing revolution, the folks at Wealthfront excel at making small money grow big. All you need to do is meet the $5,000 account balance minimum and answer a few questions about your investment goals. Wealthfront takes care of the rest.</p> <h2>3. AssetBuilder</h2> <p><a href="http://assetbuilder.com/">AssetBuilder</a> only accepts accounts of $50,000 or greater, which means it's best suited for the more dedicated investor. The company, co-founded by widely read personal finance writer Scott Burns, uses funds inclined to earn a smidgen more than normal index funds from a firm called <a href="http://us.dimensional.com/">Dimensional Fund Advisors</a>. These D.F.A. funds are typically off-limits to individual investors, making AssetBuilder's portfolio offerings all the more attractive to folks who otherwise wouldn't hire a financial advisor. Choose from a menu of conservative, moderate, or aggressive portfolios designed to match your money with the kind of growth potential and risk tolerance you're seeking. Claiming more than $600 million in assets, AssetBuilder charges between .45% and .20% in annual fees, depending on how much is invested.</p> <h2>4. FutureAdvisor</h2> <p><a href="http://track.flexlinks.com/a.ashx?foid=1029882.978749&amp;fot=9999&amp;foc=1&amp;foc2=941565">FutureAdvisor</a> specializes in retirement planning. All of its investment recommendations are made with the goal of setting you up for the most comfortable retirement years possible.</p> <p>With FutureAdvisor, you can get your 401(k), IRA, and other accounts analyzed, plus receive recommendations on how to improve your existing investments &mdash; absolutely free of charge. Then, if you're impressed with the results and want to hire FutureAdvisor as your investment manager, there's a monthly fee of either $9 or $19, depending on the value of your assets. Another perk is the ability to automatically sync your account into FutureAdvisor's recommended asset allocation. FutureAdvisor will perform all the trades for you &mdash; all you have to do is grant it the green light to do so. And unlike Wealthfront and Betterment, FutureAdvisor works off your existing portfolio. You never have to&nbsp;<a href="http://investorjunkie.com/32430/futureadvisor-review/">transfer your assets</a>&nbsp;into their firms.</p> <p><em>Have you used a robo-advisor? Which one and why?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/should-you-trust-your-money-with-these-4-popular-financial-robo-advisers">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-basics-of-asset-allocation">The Basics of Asset Allocation</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-investors-with-better-returns-than-warren-buffett">5 Investors With Better Returns Than Warren Buffett</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make">5 Dumb 401(k) Mistakes Smart People Make</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-steps-to-getting-started-in-the-stock-market-with-index-funds">3 Steps to Getting Started in the Stock Market With Index Funds</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/exchange-traded-funds-the-low-fee-investment-option-you-dont-know-about">Exchange Traded Funds: The Low-Fee Investment Option You Don&#039;t Know About</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment financial advice financial adviser investing rob-adviser Wed, 28 Jan 2015 14:00:08 +0000 Brittany Lyte 1283489 at http://www.wisebread.com 5 Reasons to Fire Your Financial Adviser Soon http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-to-fire-your-financial-adviser-soon" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman-in-charge.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As&nbsp;2014 gives way to 2015, you&rsquo;ll likely be reviewing your investment results for the year, and looking ahead to this year and beyond. So here&rsquo;s a question you may want to ask: Should I fire my&nbsp;<a href="http://www.nextavenue.org/article/2012-08/evaluating-your-financial-advisor">financial adviser</a>?<br /> &nbsp;<br /> That may sound like a nutty question, since the stock market has been gangbusters, with a positive year for the sixth year in a row. That performance doesn&rsquo;t necessarily mean your money pro has delivered enough value to justify your keeping him or her, though.<br /> &nbsp;<br /> Below are five questions you&rsquo;ll want to ask to help you determine whether you should give your adviser the heave-ho sooner rather than later. If you answer &ldquo;yes&rdquo; to any of them, it&rsquo;s time to look for a replacement.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2013-10/how-find-financial-advice-you-can-trust">How to Find Financial Advice You Can Trust</a>)<br /> &nbsp;<br /> <strong>Question 1: Did you receive a year-end performance report?&nbsp;</strong><br /> &nbsp;<br /> No report?&nbsp; Fire your adviser.<br /> &nbsp;<br /> Real advisers provide performance reports. Financial&nbsp;<em>salesmen</em>&nbsp;don&rsquo;t. Their sales licenses do not permit them to provide this type of ongoing reporting.<br /> &nbsp;<br /> <strong>Question 2:</strong>&nbsp;&nbsp;<strong>Did your adviser provide a report that disclosed all the expenses deducted from your investment accounts?</strong><br /> &nbsp;<br /> No? Fire your adviser for withholding information from you. You can&rsquo;t trust an adviser who doesn&rsquo;t display full transparency.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2012-08/evaluating-your-financial-advisor">Evaluating Your Financial Adviser</a>)</p> <p><strong>Question 3. At some point, the stock market will have a correction (less than a 15 percent loss and six months of duration) or turn into a bear market (more than a 15 percent loss and six months of duration). Does your adviser have a strategy for minimizing your risk of large losses?</strong><br /> &nbsp;<br /> No plan? Fire the adviser. Select one who can help you preserve your assets during a market that produces negative returns.<br /> &nbsp;<br /> <strong>Question 4: Has your adviser provided a document certifying that he or she is acting in a fiduciary capacity when providing financial advice and services?</strong><br /> &nbsp;<br /> No document? Fire the adviser.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2012-03/when-your-financial-adviser-guessing">When Your Financial Adviser Is Guessing</a>)<br /> &nbsp;<br /> Fiduciaries are held to the highest ethical standards in the financial service industry. They&rsquo;re&nbsp;<em>required</em>&nbsp;to put your financial interests ahead of their own. Non-fiduciaries are salesmen who are held to lower ethical standards that don&rsquo;t require them to put your interests first.<br /> &nbsp;<br /> <strong>Question 5: The financial services industry is riddled with conflicts of interest. Has your adviser provided a written statement saying that his or her advice is free of any potential conflicts of interest that could damage your financial interests?</strong><br /> &nbsp;<br /> Fire any adviser who refuses to provide this statement. You don&rsquo;t have to know what he or she is hiding or why. You just have to know there&rsquo;s the potential to damage you.<br /> &nbsp;<br /> Conflicts of interest are not obvious or easy to detect. In most cases, they&rsquo;re designed to achieve one goal: maximize the revenue of the seller. They are extremely dangerous because Wall Street&rsquo;s marketing experts know how to package toxic products and convince you that they are safe investments. Some banks and insurers sell inferior products with excessive expenses that maximize their revenues, profits, and share prices.<br /> &nbsp;<br /> The most dangerous conflict is from an unscrupulous, but friendly adviser who develops a personal relationship with you. Once trust is established, such advisers can sell customers the financial products that make them and their firms the most money. The most frequent lament from Bernie Madoff&rsquo;s clients was: &ldquo;I thought he was my friend.&rdquo;<br /> &nbsp;<br /> Always remember: the investment of your assets should be based on a&nbsp;<em>business</em>&nbsp;relationship, not a personal relationship. Fire advisers who want to be judged on their relationship skills, not their results and transparency.</p> <div class="field field-type-text field-field-blog-teaser"> <div class="field-items"> <div class="field-item odd"> Many of Bernie Madoff&#039;s clients said &quot;I thought he was my friend.&quot; Find out if your adviser is a friendly, but unscrupulous salesman and not the ethical adviser he should be. </div> </div> </div> <div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p><em>Jack Waymire spent 28 years in the financial services industry. He is the founder of </em><a href="http://www.paladinregistry.com/"><em>Paladin Research and Registry</em></a><em>, which provides free tools and information to investors who use financial advisers. Follow him on Twitter </em><a href="https://twitter.com/PaladinRegistry"><em>@PaladinRegistry</em></a><em> or connect with him on </em><a href="https://plus.google.com/+JackWaymire/posts"><em>Google+</em></a><em>.&nbsp;<em style="color: rgb(0, 0, 0); font-family: Arial, Helvetica, sans-serif; font-size: 12.7272720336914px; line-height: 1.5;">Check out more great articles from PBS's </em><a href="http://www.nextavenue.org"><em>Next Avenue</em></a>:</em></p> <ul> <li><a href="http://www.nextavenue.org/article/2014-07/27-ways-trick-yourself-saving-money">27 Ways To Tricking Yourself Into Saving Money</a></li> <li><a href="http://www.nextavenue.org/article/2012-07/biggest-retirement-mistake-boomers-make-and-how-avoid-it">The Biggest Retirement Mistakes Boomers Make</a>&nbsp;</li> <li><a href="http://www.nextavenue.org/article/2014-11/3-retirement-rules-thumb-really-work">3 Retirement Rules of Thumb that Really Work</a></li> </ul> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/next-avenue">Next Avenue</a> of <a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-occasions-when-you-should-definitely-hire-a-financial-advisor">7 Occasions When You Should Definitely Hire a Financial Advisor</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-questions-financial-advisers-hear-most-often">8 Questions Financial Advisers Hear Most Often</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-know-what-annuities-are-you-might-be-missing-out">Don&#039;t Know What Annuities Are? You Might Be Missing Out</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-tell-if-your-401k-is-a-good-or-a-bad-one">How to Tell if Your 401K Is a Good or a Bad One</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-this-hidden-cost-sapping-your-retirement-savings">Is This Hidden Cost Sapping Your Retirement Savings?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment Retirement financial adviser financial planning next avenue retirement Fri, 16 Jan 2015 18:00:08 +0000 Next Avenue 1280353 at http://www.wisebread.com What Does It Take to Become a CFP? http://www.wisebread.com/what-does-it-take-to-become-a-cfp <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-does-it-take-to-become-a-cfp" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/business-4370899-small.jpg" alt="meeting" title="meeting" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p><iframe width="605" height="454" frameborder="0" allowfullscreen="" src="//www.youtube.com/embed/Y24aL_yOK7o"></iframe></p> <p>Do you ever get confused when you hear the terms: Financial Adviser, Financial Planner, Financial Consultant, Investment Adviser, Certified Financial Planner? If you do, don't worry, you're not alone.</p> <p>Hey. This is Jeff Rose, Certified Financial Planner and personal finance expert, here at Wise Bread. Let's look at what the difference is between financial planner and CFP.</p> <h2>What Is a Financial Adviser?</h2> <p>If you've ever done any research on hiring a financial adviser or looking at the differences between the titles, you know it gets really confusing. Here's the thing. If you want to be a financial adviser, all you have to do is get a job with an investment firm or an insurance company, and you could pretty much hold yourself out to be a financial adviser. Pretty scary. To become a certified financial planner, you need to take on a whole new set of requirements and education. Let me explain.</p> <h2>What Is a Certified Financial Planner?</h2> <p>When I first got in the business, I was fresh out of college as a finance major; I passed my Series 7 exam, and became a financial consultant. That was the title that was on my business card, but you could have called me a financial adviser or a financial planner &mdash; any of those would've worked. As I advanced in my career, I really wanted something that made me stand out. Upon further research, I learned that CFP, certified financial planner, was the designation to have. The CFP designation embodies financial planning. With that, you cover the principals of general financial planning, investments, retirement, insurance, estate planning, income tax planning. Basically anything that has to do with money and your life is covered in the certified financial planner program. When you figure that everybody is at a different point in their life and has different goals, different objectives, to me, it made sense to get the designation so I could better help my clients. Now that you better understand what the CFP designation means, let's take a look at what it takes to get the designation.</p> <h2>How to Become a CFP</h2> <p>First things first, you must have a bachelor's degree to even start the program. This was a rule that was adopted about 5 years ago, so there are some CFPs that don't have a bachelor's degree. If you want a CFP nowadays, you must have your bachelor's degree. You must also enroll in a course or a program that is sponsored by the College of Financial Planning. There are several ways to do this. You can go to a real-life class setting, you can do an online setting, or you can do self-study. For me, I did the classroom setting in a crash course-like style. Let me explain.</p> <p>Each month, I would go up to my home office up in Saint Louis, and I would spend 3&frac12; days going through everything financial planning. It was seriously force-fed. I was drinking so much Diet Coke and so much coffee just trying to absorb all the information. I did that for 11 months. Afterwards, you must pass the CFP exam.</p> <p>The CFP exam is a 2-day comprehensive exam consisting of multiple choice and case studies. They give you pages and pages of sample client data, and you have to determine what is the best option for them. Let me tell you, the CFP exam was by far the hardest exam I've ever taken in my life. I've never studied for anything more than I did that exam, and I'm so thankful I passed.</p> <p>When you pass the exam, you get to call yourself a CFP, right? Not quite. The final part to becoming a CFP and actually using the designation on your business card, or to even call yourself a certified financial planner, is meeting the experience requirement. The experience requirement is 3 years or 6,000 hours of working in the financial planning industry. You have to be working with clients, analyzing data, presenting client data. Basically, you have to be doing financial planning in order to be able to use that experience requirement. For me, I actually didn't take the exam until I had been in the business for over 4 years, so I more than satisfied that 3-year requirement.</p> <p>On top of the education and experience requirement, you're also held to a higher ethical standard. If you go onto CFP.net and you want to find info on a potential CFP that you're might be hiring, you can see if anything has been filed against them. For example, have they filed bankruptcy? Has anyone filed a complaint against them? Is there anything that shouldn't be on their record for being a certified financial planner? If that's the case, you'll find that on CFP.net.</p> <p>Everything I've explained to you just shows what being a CFP is different than a normal financial adviser that doesn't have to go through the scrutiny and the education and experience requirements. If you're looking to hire a financial adviser, I would strongly encourage you to find a CFP. As I mentioned, head on over to CFP.net to find a good financial adviser for you.</p> <p>If you have any more questions like this, feel free to hit me up. This is Jeff Rose, your resident personal finance expert here at Wise Bread. We'll see you next time. Take care.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jeff-rose">Jeff Rose</a> of <a href="http://www.wisebread.com/what-does-it-take-to-become-a-cfp">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/beware-your-insurance-may-not-cover-these-8-losses">Beware: Your Insurance May Not Cover These 8 Losses</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-why-life-insurance-isnt-just-for-old-people">5 Reasons Why Life Insurance Isn&#039;t Just for Old People</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-your-group-life-insurance-is-not-enough">Why Your Group Life Insurance Is Not Enough</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-times-when-bundling-insurance-doesnt-make-sense">4 Times When Bundling Insurance Doesn&#039;t Make Sense</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/term-vs-whole-life-insurance-heres-how-to-choose">Term vs Whole Life Insurance: Here&#039;s How to Choose</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Insurance certified financial planner CFP financial adviser life insurance Fri, 30 Aug 2013 18:01:02 +0000 Jeff Rose 981649 at http://www.wisebread.com