1. Align your interests by working with a fee-only adviser, meaning one who does not accept commissions. All advisers have some conflicts of interest, but fee-only advisers have the fewest. (Note that "fee-based" advisers are different -- they receive a blend of commissions and other fees.) You can find a fee-only adviser through the National Association of Personal Financial Advisors. Some fee-only advisers, as well as some brokers, charge a percentage of your assets (say, 1% to 2% a year) to manage your money on an ongoing basis. Others charge a fee, generally $100 to $300 per hour, to help you set up a financial plan or for periodic advice. If you have a one-time need for advice or you just want to keep a tight rein on costs, the latter may be the better option for you. You can find an hourly adviser through the Garrett Planning Network.
2. Learn the alphabet soup. A Certified Financial Planner (CFP) is a generalist who should be able to help you with your whole financial picture. The Chartered Financial Analyst (CFA) designation indicates particular expertise in investing. A Certified Public Accountant (CPA) is a tax whiz. And a Chartered Financial Consultant (ChFC) has extensive training in insurance and estate planning.
3. Be picky. Get to know several candidates before settling on one. Personal chemistry matters, and there's no point spending your money on advice from someone with whom you don't feel at ease. Most advisers will give you a complimentary introductory session -- in order to go over your needs, their process and what you can expect their services to cost -- before you make a formal arrangement. Take advantage of these sessions. A good adviser should spend at least an hour learning about your full financial picture -- including, for example, your goals, income needs, tax status and health, as well as the quality of your insurance coverage -- before recommending any specific investments. It's a red flag if he or she gives you a breathy spiel about some hot investment within the first five minutes of meeting you.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
4. Ask the tough questions. You want to get a complete picture of an adviser's background, specific expertise, fees and investment philosophy. Feel free to ask for references to other clients. Before you sign a formal agreement, make sure you and your adviser understand exactly what services he or she will be providing and how long you expect your relationship to last. And stipulate whether you can get a full or partial refund if your relationship ends early.
5. Avoid another Madoff. If you are looking for someone to manage your investments for you, invest with an adviser who uses a third-party custodian. Convicted swindler Bernard Madoff held client funds in his own custody, which is how he was able to drain clients' savings and fudge their account statements. If your adviser uses an independent custodian, such as Charles Schwab or Scottrade, those institutions will take possession of your money and your account statements will come from their offices (rather than from your adviser's).
6. Do a background check with regulators. An adviser's Form ADV will tell you if he or she has any closeted skeletons. If your adviser is also registered as a broker, you should check him or her out at www.finra.org/brokercheck. Finally, you can contact your state securities regulator and ask any professional organizations to which your adviser belongs (such as the CFP Board or the American Institute of CPAs) if he or she has a disciplinary history.
-
3 Ways to Stretch the 2026 Social Security COLA For Your BudgetThree steps retirees can take to stretch the Social Security COLA to fit their budgets.
-
How to Keep Your Charitable Giving Momentum Going All YearInstead of treating charity like a year-end rush for tax breaks, consider using smart tools like DAFs and recurring grants for maximum impact all the year.
-
Uber Takes Aim at the Bottom Lines of Billboard LawyersUber has filed lawsuits and proposed a ballot initiative, in California, to curb settlements it claims are falsely inflated by some personal injury lawyers.
-
10 Retirement Tax Plan Moves to Make Before December 31Retirement Taxes Proactively reviewing your health coverage, RMDs and IRAs can lower retirement taxes in 2025 and 2026. Here’s how.
-
The Rubber Duck Rule of Retirement Tax PlanningRetirement Taxes How can you identify gaps and hidden assumptions in your tax plan for retirement? The solution may be stranger than you think.
-
Older Investors: Boost Your Savings and Retire EarlierThis one measure can help older investors retire up to two years earlier and potentially double their retirement savings.
-
What Does Medicare Not Cover? Eight Things You Should KnowMedicare Part A and Part B leave gaps in your healthcare coverage. But Medicare Advantage has problems, too.
-
457 Plan Contribution Limits for 2026Retirement plans There are higher 457 plan contribution limits in 2026. That's good news for state and local government employees.
-
Estate Planning Checklist: 13 Smart Movesretirement Follow this estate planning checklist for you (and your heirs) to hold on to more of your hard-earned money.
-
Medicare Basics: 12 Things You Need to KnowMedicare There's Medicare Part A, Part B, Part D, Medigap plans, Medicare Advantage plans and so on. We sort out the confusion about signing up for Medicare — and much more.
-
The Seven Worst Assets to Leave Your Kids or Grandkidsinheritance Leaving these assets to your loved ones may be more trouble than it’s worth. Here's how to avoid adding to their grief after you're gone.
