Help! I Need a Money Adviser, not a Salesperson

As we've discussed here in the past, many "financial advisors" are really just salesmen disguised as "experts." This is the same issue addressed in an article from MSNBC. It starts with this question:

How does one find a financial adviser to create a financial plan for retirement who is not selling a product? I would love to have an adviser who sits down with me to create a total plan which might include savings, real estate advice, other funds to invest in, what accounts yield the highest interest, how much time I need to do what I want to do, and pay that person a fee for the service rather than a percentage of the investments the he/she recommends.

Luckily, there's a simple answer. Here's the response from the Today Show's Jean Chatzky:

What you’re talking about is called a fee-only financial planner (or fee-only financial adviser).  And, although they’re not nearly as common as planners who get a commission for the financial products they sell to you, there are enough of them out there that you should be able to find one in your area. 

The easiest way to find one is to go to the Web site of the National Association of Personal Financial Advisors and plug in your ZIP code. 

All the planners in this database are fee-only. 

To note: Just because someone is a fee-only planner, doesn't mean they're a good fee-only planner. Use the same criteria you would when you hire any professional (lawyer, doctor, etc.) -- ask for references, ask your friends and family if they've ever heard of the person, as for a free, introductory meeting to get to know him/her, etc.

Comments

[thc]

Excellent post, but I would add that many excellent CFPs don't belong to NAPFA and this organization doesn't require a planner to have any credentials other than being "fee only".

[BLewis]

Actually, this last poster is incorrect in their assessment of NAPFA advisors. They are all Fee-Only and the organization REQUIRES them to either have a CFP, PFS, or CFA. Unless you have one of these designations, you are not considered a NAPFA-Registered Financial Advisor. Also, NAPFA members are held to a Fiduciary Oath - the only professional association in the country to require such a standard.

[Param]

Sorry, but I think blanket recommendation of NAPFA is wrong. What this guy needs is a planner who charges by the hour or per project (service) and does not have compensation based on commissions or % of AUM (both are based on amount investment). NAPFA does not work on commissions, but they can work on % of AUM & still call it a fee-only model. While it would be good to see the planner benefit (or lose) if the portfolio goes up (or down), that still doesn't make fee-only (% of AUM) model the best...