Most people would never think of changing their car's transmission on their own. They don't have the time or the skills to do it themselves, so they hire a mechanic to feel better. Many investors do the same thing when they invest: they talk to an experienced financial adviser for advice.
The 77 million Americans who are getting ready to retire want to make sure their money won't run out before they do. But the average investor doesn't understand how the market works or how to invest in complicated financial products. Studies show that people feel better about their financial futures when they talk to a financial adviser. But how do you find the right person for the job?
Step 1: Figure out what you need. Whether you need help planning for retirement or saving for your kids' college, you should know what your financial goals are before you start looking for an adviser.
Step 2: Ask people you know, like, and work with for suggestions. You should feel comfortable putting your hard-earned money in the hands of your financial adviser.
Step 3: Talk to at least three advisers before you make your final choice.
During an interview, there are many things to think about. Look for a financial adviser with a lot of experience in many areas, such as investments, insurance, and planning for retirement. You should also ask about the adviser's licence. He or she should have a valid Series 6 or Series 7 registration. You can call the National Association of Securities Dealers (NASD) at (800) 289-9999 to find out about an adviser's past.
Once you know the adviser has a good track record, it's time to find out more about him or her. A good adviser will look at all of your finances and make a plan just for you that will help you reach your goals. No matter how much money a client puts in, he or she will give the same level of service to everyone. It's also important that your adviser has the same "investment philosophy" as you do. For example, an investor who wants to avoid risk shouldn't work with a financial adviser who likes to take risks.
