Picking the Perfect Financial Planner

Pablo Picasso once quipped, “I’d like to live as a poor man with lots of money.” And wouldn’t we all? To have money, and all the wondrous things that money can provide, without the hassles and headaches of tending to that money –it would seem almost, er, surreal. Yet if anyone could make Picasso’s dream come true, it would be a capable financial planner.

Suppose you determine that you need a financial planner, where in this great, big American landscape would you find a good one?

Ask yourself why

Financial planners — whose business cards may also say financial adviser, financial consultant or wealth manager — vary widely in their practices and expertise. Most, if not all, planners will manage or provide guidance on investments. Others may offer counsel on everything from how to balance a checkbook and reduce debt to how to lower taxes or set up an estate plan. Some will work with you for a day to help you get your fiscal affairs in order. Others prefer longer-term arrangements. Take a good look at your own strengths and weaknesses around money, and ask yourself where you most need a helping hand.

Gather names and brochures

Start by drafting a list of potential planners. Begin close to home. Ask family, friends and business colleagues for referrals. You can also contact either the National Association of Personal Financial Advisors (www.napfa.org) or the Financial Planning Association (www.fpanet.org) for a referral to members in your area. Some people are OK working with a planner from afar, perhaps even in another state. Ask yourself as to how you would feel about that.

Look for experience and credentials

Just about anyone can call himself/herself a financial planner, and just about anyone does. That’s why other, more standard credentials are important. A business degree, such as an MBA, is a good thing. Some CPAs and attorneys specialize in financial planning. In addition, the designation CFP, which stands for certified financial planner, has become widely recognized as a mark of competency over the past several years. To attain the CFP, a planner must meet certain educational requirements, pass a fairly tough exam and then have a requisite amount of practical experience.

Toss the bad apples

Beyond having credentials, a financial planner (or his employer) should also be registered with the Securities and Exchange Commission. Find out by asking to see a candidate’s ADV (adviser) form. Anyone who professionally gives investment advice is required to provide such a form. It will provide you with lots of interesting information about the planner and his practice, such as how long he’s been in business, how many clients he has, and how much money he manages. It will also tell you about any disciplinary history for unethical conduct. Check, too, with the local Better Business Bureau (www.bbb.org) and the Certified Financial Planner Board of Standards (www.cfp.net) to make sure the planner isn’t prone to lapses of good judgment.

Stroll into the office

After you’ve gathered a list of planners who look clean on paper, it’s time to meet face to face. Schedule an initial appointment. There should be no charge. Although you’re no expert in the field, you can still get a pretty good sense as to whether a planner knows his stuff. Ask what sets a planner apart from other planners. Ask for his philosophy on money and whether he/she has a clearly defined strategy for financial success. As for investing, ask how he/she does it, and whether his choices in investments are based on hunches or on academic research.

Check out the bill

Be clear about how, and how much, a planner will charge you. Some financial planners charge by the hour, some will charge you a percentage of your assets “under management” and others will make money off commissions from the products they sell you. Many planners who do not sell products or take commissions (fee-only planners) feel that they can be more objective in the advice they give you, and in the investments they suggest for you. Commissioned planners argue that any honest planner would never be swayed by commissions into making bad investment choices. Like astronomers and astrologers, the two groups sometimes seem to hate each other, but there’s no reason that you need to pick sides.

“You want someone who is honest and really knows what he or she is doing; that matters much more than how that person is paid,” said Helen Salazar-Realini, a certified financial planner.

Is there chemistry

Financial planning is very much unlike, say, auto mechanics. It can get awfully personal at times. A competent planner working on your long-term financial goals should be asking you questions about your retirement dreams, your health and, perhaps, even the quality of your marriage and your relationship with your children and grandchildren. (Well, do you want them in your will or not?) If you’re going to be working with a planner for a long time, the two of you should click.

Russell Wild is both a financial journalist and a fee-only investment adviser based in Allentown, Pa.


Your Letters

Buy It Now

Thank you for your article about the impending closures of Jewish Community Centers (JCC) (“Buy It Now,” May 14). The Los Angeles Jewish community runs contrary to the rest of the country. Jewish philanthropy is very visible in the secular community, with large contributions to local hospitals and universities. Why is there not an outcry against the closure of our Jewish Community Centers?

As a founder of the West Coast Jewish Theatre (a member of the Association of Jewish Theatres, which is affiliated with the National Council of JCCs), I am heartbroken because I have visited JCCs in so many cities, such as Newton, Mass.; Kansas City, Mo.; Cleveland; Washington, D.C.; and Southfield, Mich., among others. I think The Jewish Federation should reconsider what legacy they are leaving Los Angeles, and a concerted effort should be made to change directions and educate The Federation and the rest of the community as to the importance of the JCCs.

Naomi Jacobs, Marina Del Rey

Lacking Credentials

I read the opinion piece by Nonie Darwish, “When Arab Means Never Saying Sorry” (June 4). I found the polemic to be reductionist and simplistic (what does the term “Arab street” really mean?), so naturally I looked to see what were the credentials of the author. I found none listed; evidently she has no background in Arabic studies, whether literature, history, political science, anthropology, sociology or any other discipline. So what about her personal experience and what might give that experience any legitimacy? Her Web site, replete with misspellings, coyly says that she has a Middle Eastern background but deliberately leaves unclear whether she is Jewish or Arabic. That she is on the board of something called the Mid East Education Team means nothing — anyone can create a pseudo-education “team” or institution that is totally devoid of value. The Institute for Historical Review, for example, is nothing more than a group of so-called historians dedicated to Holocaust denial and ongoing anti-Semitism. I do not understand why The Jewish Journal, with so many experts on every facet of the Middle East and terrorism at its disposal, would stoop to give space to someone with nothing to bring to the discussion and no useful policies to propose.

Deborah Bochner Kennel, Los Angeles

Editor’s note:

Darwish, profiled in The Jewish Journal of April 23,2004, was born in Cairo, Egypt, and raised for much of her childhood in Gaza.She holds a bachelor of arts degree in anthropology and sociology from theAmerican University of Cairo. In Cairo, she worked as an editor at Middle EastNews Agency. For more on Darwish, visit www.StarSpeakers.org  and jewishjournal.com/archives.

New Coalition

Leonard Fein is exactly correct that blind support of Israeli policies and actions does not make one a true friend of Israel (“Pursuit of Peace Requires New Coalition,” June 4).

Fein says, “We have long since learned to swallow hard as the Israelis persist in policies that are ill-conceived and ill-executed, policies that threaten the entire Zionist enterprise.”

I go further and say that as a Jewish American I am embarrassed by those policies, many of which are designed to mistreat and humiliate Palestinians. These policies are not leading to a two-state solution, which is the only resolution of the Israeli-Palestinian problem that will preserve Israel as a Jewish state.

Fein does not mention the unintended consequences that blind support for Israeli policies and actions by the U.S. government have brought. Clearly the lack of a solution to the Israel-Palestinian problem and the U.S. support of all Israeli actions causes angst throughout the Arab and wider Muslim world, and underlies much of the Islamic terror that the United States is now fighting.

President Bush, fighting America’s war on terror, and Prime Minister Sharon, fighting Palestinians, are in a mutual death dance. It has to stop.

Jeff Warner, La Habra Heights

Leonard Fein is right on target. He states that since the Palestinians rejected the Clinton/Barak plan, Israel is compelled to try new and different approaches. After all, giving them 97 percent of what they were asking for was surely not enough.

Here are some ideas that would fit his predictable ideology: How about forming a binational state? How about letting the descendants of the Palestinian refugees enter Israel? How about making all the Palestinians in the West Bank and Gaza Israeli citizens? Or better still, how about making all the Jews return to their points of origins? These are approaches that will satisfy the Palestinians. And peace will surely follow.

And, then like the Europeans and the Arabs, Fein can polish up a draft of the eulogy for Israel. The world will weep sanctimoniously for the late State of Israel, but the problem with the Palestinians will be solved forever.

Fein has ignored the fact that Hamas and the Palestinian Authority are opposite sides of the same coin: one explicitly calling for the destruction of Israel, the other implicitly, and both by their actions.

Jack Salem, Los Angeles