by A. South

Created on: September 29, 2008

If you are meeting with a financial planner it is first imperative to have goals prepared. At what age do you want to retire? When do you want to be in a position of to buy a house? Do you have a car? Do you want to buy one in the future with out paying an interest on it? Do you have 3 to 6 months of money in case you loose your job in order to pay bills, rent, food etc.? Do you have any other debt you want to pay off?

It's the planner's job to then assess your goals and create a plan to help you achieve them.

Once you have your goals in place, choose the right planner and figure out what you want from the meeting. Be careful and trust your gut, a lot of advisors/investment reps out there are interested in their commissions rather than what might be best for you. However, there are also a lot of great advisors out there that really look out for you. Don't be afraid to shop around. Some advisors don't charge a fee to planning, but do get paid if you decide to invest with them. Some charge for planning, and having sound financial advice is worth paying for.

Questions you should ask and things you should watch out for:

-Make sure they are open about their fees with you (whether they are just giving you planning advice, and also if you choose to invest with them). Ask them how they get paid. Remember they are providing the service to you.

-If they handle investments, you can check them out at FINRA.org and make sure they don't have any complaints, lawsuits, etc. Look for a planner that has the CFP (certified financial planner) designation. They have to stay in good standing to keep that designation.

-Don't rely on the planner to do all the work, educate yourself too! Don't blindly trust them, learn what they're doing, how and why they're making the decisions they are. Look for a planner that makes it a priority to educate you about what they are doing for you financially.

-Never be afraid to ask questions, and don't be intimidated by how much you think they might know. If you don't understand something, ask questions until you do. Don't just hand over your money and trust they will do the right thing. Feel free to meet with them a few times before you decide to invest.

-Investing your money. They may suggest you open a Roth IRA or a Traditional IRA. These are good things. If you work somewhere that offers a 401(k) and you are eligible, you can ask the advisor to go over the investments in the plan and have them suggest which you should choose. The more you save now (especially while you are young), the less you have to save later. Even if it's 20 dollars a month, that's going to grow if it's invested properly. Ask them to show you how.

-Red flags include things like guarantees. The industry doesn't allow financial planners to guarantee you won't lose money so be wary of anyone who offers any guarantee. Your investments will go up and down with the market, that's just the way it is. Good investment choices can overcome downturns over the long run (look at 10 year returns). Look for a balanced portfolios made up of mutual funds that will perform consistently over the long term (ask to see the returns on investments if you decide to invest). Although the market is down right now, there are lots of investment choices that can produce 8-12% returns over the long run. Just because a fund did really well last year, or the last two years, doesn't mean it will perform well longterm. But again, it's an up and down market so great long term results don't guarantee future performance either.

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