SELECTING A FINANCIAL PLANNER

Transcription

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2 SELECTING A FINANCIAL PLANNER Karen P. Schaeffer, CFP April 15, 2015

3 Know What You re Looking For

4 Good Data = Good Planning 1. Identify Goals 2. Construct Your Balance Sheet 3. Analyze Your Cash Flow

5 Identify Goals What are financial goals? The things that you need and/or want to spend money on beyond routine monthly expenses.

6 Balance Sheet Take an annual snap-shot of where you are Assets Debt

7 SAMPLE Monthly Cash Flow Items Income Current Retirement Salary Interest/Dividends Other Expenses Tax Retirement Funds Mortgage Auto Life Insurance Child Care Vacations TOTAL

8 Shock Events

9 You Might Need Help With Becoming established Jobs and employee benefits Moving in with a partner Marriage Having children Divorce Death of a spouse/partner

10 You Might Need Help With Buying a home Retirement planning College planning Aging parents Medical issues Estate planning Emergency funds

11 Financial Planning Helps You Set realistic and personal goals Assess your current financial situation Develop a realistic, integrated plan Put your plan into action and monitor its progress Stay on track as circumstances change Provide direction to your life goals

12 Working with a Financial Planner Very personal relationship Must have rapport and trust Must have integrity and ethics Fiduciary relationship they put your interests ahead of their own Must work in a style and manner you re comfortable with

13 Why a CFP Professional? Education Examination Experience Ethics

14 Caution: Red Flags Ahead

15 We ve known him forever. I m sure you can trust him.

16 Your Self-Defense Moves Ask your financial professional if they are a fiduciary. Trust, but always verify. Ask your prospective financial professional to identify the organizations that license or supervise him.

17 Just sign here. I ll take care of the rest.

18 Your Self-Defense Moves Regardless of the paperwork burden, do not leave blanks that someone else could fill in without your knowledge or consent. Ask your financial professional to send you copies of the final, submitted documents.

19 This is just for my special clients.

20 Your Self-Defense Moves Ask your financial professional to verify in writing that his employer or company supervises the investment. Ask the employer or company directly whether it approves and supervises the investment. If your financial professional is a sole practitioner, verify that she carries professional liability insurance. Remember that investments should always be regulated or supervised by independent third parties, with the risks and possible conflicts of interest fully disclosed.

21 I ll send you all of the investment reports.

22 Your Self-Defense Moves Make sure you receive regular statements from independent third party sources. If you invest in limited partnerships, real estate, or nontraded securities any investment not valued frequently or held by a separate custodian verify that the investment manager is audited annually by a reputable independent accounting firm.

23 Make the check payable to me.

24 Your Self-Defense Moves Never give a financial professional a blank check that can be filled in later. Refuse any request for a personal loan. Question any situation that gives a financial professional unlimited access to money intended for investment (or money actually invested). That includes giving the professional a full power of attorney for your accounts.

25 I know it s a difficult time, but you need to decide.

26 Your Self-Defense Moves Be suspicious of pressure tactics or sales pitches during a major life change. Find an advocate a close family member or trusted professional to help you with truly urgent matters, such as meeting tax or reporting deadlines.

27 This one s a no-brainer, you can t lose.

28 Your Self-Defense Moves When your financial professional recommends a fund, insurance contract, or retirement strategy, listen carefully for a fair, complete discussion of the pros and cons. Write them down. If you re hearing only pros, you re not getting the full story. Ask the financial professional under what circumstances the investment will not perform as projected. Make sure the financial professional focuses on your specific needs as much as on the investment.

29 I can replace that with something better.

30 Your Self-Defense Moves Whenever you are presented with a proposed transaction, ask, What does this cost me? Always ask your financial professional, Do you get paid from this transaction? Consider whether the timing of proposed transactions is motivating the recommendation.

31 Finding a Financial Planner Certified Financial Planner Board of Standards Financial Planning Association National Association of Personal Financial Advisors

32 What qualifies them to give you advice? Remember: It s all about you!

33 How Are They Paid? Fees Commissions Fee and Commissions Fee-offset Salary

34 Karen P. Schaeffer, CFP is the Managing Member and Co-founder of Schaeffer Financial LLC, an SEC-registered investment advisory firm located in Rockville, Maryland. This presentation is for informational and educational purposes only. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or products made reference to directly or indirectly in this presentation will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. The views and opinions expressed in this presentation are those of Karen P. Schaeffer. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Any hypotheticals or examples are for illustrative purposes only and not indicative of actual results. Past performance may not be indicative of future results Moreover, you should not assume that any discussion or information contained in this presentation serves as the receipt of, or as a substitute for, personalized investment advice from Schaeffer Financial LLC. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. A copy of Schaeffer Financial LLC's current disclosure brochure discussing its advisory services and fees is available for review upon request.

35 Thank You for attending today s webinar! This webinar is brought to you through a partnership between WAEPA and NITP.

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