Using a financial advisor, also known as a financial planner, can help you plan ahead for the retirement years and beyond. The planner will give you expert advice on your portfolio, investments, and other accounts. They can also check to see if you are paying the correct amount in yearly taxes, paying too much in investment fees, and saving enough for retirement.
You will want to know when the best time to use an advisor, where to find one, and understand how financial advisors are paid. The Memphis area offers plenty of financial advisors to help you prepare for your financial future.
When it comes to retirement, you will want to begin using a financial advisor as soon as possible. The advisor can look over your portfolio and help you create a blueprint. Although financial advisors are not economists and predict investment outcomes, they can make suggestions based on your portfolio risk.
If you already employ a financial advisor, consider meeting with them at least annually to clarify your financial plan and see what other investments you can make that will benefit your portfolio.
There are a number of resources you can use to locate certified financial planners (CFPs) in and around the Memphis area.
Check out the CFP Board of Standards website to find legitimate and certified financial planners in Tennessee to get you started.
The National Association of Personal Financial Advisors (NAPFA) features a database you can use for free to search either by name or location.
Your family attorney or elder-law attorney may also have suggestions for CFPs they have worked with in the past. You will need to background check the credentials for each prospective CFP.
Before choosing an advisor, ask your friends, family, and colleagues for recommendations. You will want to interview each advisor you are considering and check their references. You can also check their certification status and disciplinarian history on the CFP Board’s website.
Certified financial planners are paid in one of three ways: fee based only, commission only, or a fee and commission combination. Planners using the fee based only method will charge an annual percentage on your account, which is based on your portfolio’s performance.
Financial planners using the commission-based method will receive commission on the products they sell you. The problem with this method is if your advisor is receiving a kickback, they may sell you products you do not necessarily need for your portfolio. Research any products before investing if your financial advisor is commission-only.
Those planners that are paid on both commission and through fees are typically full-service providers offering you money management as well as investment opportunities.
Discuss the complex fee structure with each prospective advisor or brokerage firm and confirm they are a fiduciary before choosing one to represent your best interests.
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