How to Choose a Financial Planner

Professional advisers operate in a variety of ways­ —and get paid differently too

5. Do you work with an independent custodian?
Whether your adviser is managing your money or you are the person who signs off on each financial decision, your adviser should not be holding your funds. Your money should be held by an independent custodian company. Make sure you know the name of the company, how to contact the company, and your account numbers.

6. Will I be able to review all transactions?
The answer should be, “yes.” When you receive your statements, be sure you look at all transactions. Make sure you understand each purchase, sale, deposit, and withdrawal and why it was made. Like any relationship, your interaction with your planner should be based on trust, honesty, and openness.

The Do’s and Don’ts of Picking a Financial Planner
Do find out about the planner’s experience and qualifications are.
Don’t jump into the relationship without doing your homework first.
Do keep tabs on all transactions and other dealings related to your portfolio.
Don’t assume that your friend’s financial planner will be the right one for you.
Do seek out a new financial planner if your first choice isn’t working out.
Don’t feel that you have to work with the first financial planner you interview.

This article originally appeared in the December 2009 issue of Black Enterprise.

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