A financial advisor can review your finances to see if you are paying too much in investment fees or taxes, not saving enough for retirement, or need help creating a diversified investment portfolio. Although you may have thought financial advisors, or certified financial planners (CFPs), were only for the wealthy that is not the case as most CFPs offer affordable rates.
A financial advisor will assess your level of risk and make recommendations based on additional factors like your age and your age at retirement. The two of you will create a financial plan to increase your accounts and meet financial goals to carry you 20 to 30 years past your retirement age.
If you currently employ an advisor, meet with them at least once a year to discuss your portfolio and any major life events that could change your financial plan, such as marriage or divorce.
If you do not have a financial advisor, consider choosing one as soon as possible to make sure your finances are on track to meet your goals. If you can hire one while you are still working, the advisor may have a suggestion that would increase your 401(k) from your employer.
You can locate financial advisors in the Riverside County area by searching the listings on the Better Business Bureau (BBB) for Central California and Inland Empire Counties. The BBB lists 57 financial advisor businesses within 100 miles of Riverside. The CFP Board of Standards and the National Association of Personal Financial Advisors (NAPFA) each host a database of certified professionals. The CFP Board keeps records of each CFP as well as their credentials while the NAPFA lists advisors that charge on a fee-only basis.
Your attorney or elder-law attorney may be able to provide you with additional recommendations for local financial advisors.
Please be sure to research a prospective advisor’s credentials no matter whether you got your referral from a listing online or through your family and friends. You can research a CFP’s certification status, bankruptcy history, and disciplinarian reports on the CFP Board’s website. Also, contact each advisor’s references to get client feedback.
When you sit down with a prospective financial advisor, ask them to explain their pay structure to you. Most CFPs are paid in one of three ways: fees only, commissions only, or a combination of fees and commissions.
When a CFP charges a fee it is typically a percentage of the holdings based on the portfolio’s performance and charged annually. CFPs can also earn commissions on the investment products you purchase from them. If this is the case, make sure the advisor is a fiduciary that will place your best interests above their own monetary goals.
Some financial advisors that offer a wide range of services use the combination of fees and commissions as payment. These financial planners may offer you money management in other areas or help you with trusts and other accounts.
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