How to Find a Good Financial Planner or Financial Advisor

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Qualifications and Industry Exams

The next section is the qualifications section. This is what you are actually looking for. The disappointing truth about these broker reports is that they are not very useful. However, the one useful section is the Qualifications section. There might be a blank page because state registration isn't required for a lot of people. But, there should be a page that lists the exams the advisor has passed.

Don't worry about the names, just look where it says "Series XX". Your advisor must have a Series 6 or Series 7 to sell registered securities. If they do not have a Series 6 or Series 7 make a note of it. Now, look at the date the exam was passed. Your advisor has been an actual advisor since this day, and not one day before. Until then, this person had to have someone else (a qualified person) doing all of the investing. There should also be a Series 63, 65 or 66. Chances are it is within a month or two of the Series 6 or 7 because you need both to be considered "fully licensed."

Also, note if the financial planner has ONLY a Series 6 and not a Series 7.  This financial advisor cannot sell you anything but mutual funds and insurance.  They cannot sell you stocks, bonds, or any number of other investments.

Make a note about the other certifications they have, but don't worry too much about them right now.

The next part lists the previous 10 years of job history. Again, there is no need to study it in detail, but do take a look. If they have all engineering jobs for seven years and then start working at Merrill Lynch, that isn't a problem. Lots of people change careers, and an engineer probably has a pretty good idea for detail. You are just getting a feel. Don't try and judge anyone based on paper. It probably wouldn't work out too good for you either.

The final section is affiliations. This is where the financial planner has to report any outside activities. Theoretically this make sure there are no undisclosed conflicts of interest. If you are looking at someone that works for a large firm this is mostly moot because there is no way a financial advisor has any access to or control over the inner workings of say Citibank. However, if the advisor owns their own firm this is where you might notice something like real estate ventures they are involved with or whatever. Mostly you care because if they suddenly start talking up a certain real estate investment you want to make sure they aren't leading you into their own company.

The Financial Advisor Companies and Businesses

While you are looking at both the business card and letterhead make a note of the other companies listed.  This may tell you that this financial advisor also is affiliated with an insurance company.  It may tell you that your financial planner works for a sub-corporation of a bigger one.  Again, nothing bad here, but it will help feed your next meeting's discussions.

At this point you have some notes.  Now, it is time to have your introductory meeting, either in person or over the phone.  Keep in mind if you meet over the phone you won't get to use what you see to help form your judgements.

Page 3 - How to Find a Good Financial Advisor