Choosing a Financial Planner

A financial planner can be an invaluable advisor to you as you work towards your financial goals and dreams. A good financial advisor can act as the quarterback for your team of advisors, working with your tax advisor, insurance agent, etc. to make sure the different parts of your financial plan are working together.

Most people could use some help keeping their financial house in order. When should you hire a financial advisor? Some people hire financial planners only when they need advice about a specific issue such as saving for college, paying down debt, or evaluating an early retirement offer. Others hire a financial planner to complete a comprehensive plan and monitor that plan on an annual basis. No matter what your reason is for hiring a financial planner, one of the greatest advantages of working with a financial expert is the added motivation you’ll have to achieve your financial goals.

One concern with hiring a financial professional is that anyone can call themselves a financial advisor. Unlike lawyers and CPAs – where you have to take an exam and have specific training before you can hold yourself out as a CPA or an attorney – there are no such requirements before you can call yourself a financial planner.

However, there are some designations in the financial planning field that help distinguish experienced, trained financial professionals from others who may not have any qualifications. Some of the designations to look for include:

Certified Financial Planner (CFP) – to be a CFP, you must meet an education requirement which shows that you are knowledgeable in all areas of financial planning, you must pass an exam, and you must have three years of relevant experience before you can hold yourself out as a CFP. CFPs must also abide by a Code of Ethics which are enforced by the CFP Board.

Chartered Financial Analyst (CFA) – A CFA is a title given to someone who has passed an exam about investments and finance administered by the Financial Analysts Federation.

PFS – CPAs who have several years of experience providing financial planning for individuals can attain the PFS designation. CPAs who also have the PFS designation have extensive tax and financial planning experience, so they are a good choice for people with complex tax situations.

You should contact and interview several financial advisors before hiring one. Some questions you should ask include how are you compensated, do you have an area of specialty, do you have clients similar to me, how long have you been providing financial advice, etc.

Working with a Fee Only Financial Planner

You don’t have to be rich to work with a financial planner. Many people hire financial planners to help them achieve their financial goals and dreams, whether they have a million dollars or just a few thousand dollars saved. You’d be surprised at the number of people who have turned to financial advisors for help with retirement planning, investment advice, budgeting and debt management, tax planning and/or comprehensive financial planning.

There are many reasons why you might want to talk with a financial planner including:

– to learn how much you really need to save for retirement
– to determine the best investments to meet your goals
– to make sure you are getting all of the tax benefits you are entitled to
– to understand how much and what type of life insurance you need
– and many more…

You don’t need to wait until you have enough money or are ready to retire to work with a financial advisor. Young people just starting out can benefit from financial planning just as much as married couples preparing to retire in a few years can. Whether times are booming or we’re in a recession, whether you just need help creating a budget, saving for your children’s college education, or you have complex retirement planning needs, anyone can benefit from financial planning.

What Should You Expect When Working with a Financial Planner?

In general, a financial advisor will start by reviewing your current situation and helping you identify your financial goals. Once your goals and objectives are determined, a financial planner will prepare a plan that will help you achieve your financial goals through saving, investing, budgeting, etc. The plan should cover all aspects of your financial situation including cash flow and debt management, investments, retirement, taxes, insurance and estate planning. Other areas that may also need to be considered include saving for college, or business planning.

Once you have a financial plan in place, you should review it periodically to make sure you’re still on track to meet your goals. Your financial situation is always changing, so your financial plan should change as well.

What to look for When Choosing a Financial Advisor

There are many types of financial planners including fee-only financial planners, fee-based advisors or the traditional brokerage firm. Each provides different services, and more importantly, each is compensated differently. Brokerage firms typically sell you a product for a commission and their main service is investment advice. Fee-based advisors will generally provide more comprehensive financial planning, but their main service is managing your investments for you, and they earn a percentage of the assets managed for their compensation. Fee-only financial planners focus more on comprehensive financial planning, including retirement planning, investment advice, budgeting, tax strategies and estate planning. Fee-only financial planners typically charge an hourly rate or a project fee and don’t earn commissions on any products recommended.

In addition to services offered and compensation, you should also look at the advisor’s experience, qualifications, and their area of expertise before hiring them. While CFPs and NAPFA-registered advisors must have met certain education and experience requirements in order to use the credentials, other financial advisors may not have any experience or qualifications.

Why Work with a Fee Only Financial Planner?

When you work with an advisor who is dependent on the commissions they earn from products they sell, there may be a conflict of interest. With fee only financial planners, there is no conflict of interest because the financial planner is paid directly by you for the services they provide, not the products they recommend. A fee only financial planner does not benefit economically from the products they recommend to you, so you can be sure that they have your best interests in mind when they make a recommendation.

Personal Finance Advice

Do you run out of money by the end of the month and have to wait for the next paycheck to get back to normal life? Do you end up with no monthly savings despite wanting to stash away a certain amount for the future? Or do you simply wish to save up a sum for that well deserved vacation? Then you are in need of some personal finance advice.

The basics of this advice are to try and help you become disciplined in your spending. Most of the time, the extravaganzas are done on the spur of the moment and this is what causes the most strain to your budget. While occasional spending sprees are fine and in fact, normal, making them a habit are what is risking people that are on a tighter budget. And you definitely wouldn’t want that. Also, it is important to effectively manage your personal finance today so that you can save some money for the future. You never know what the future is like and with a global economic climate that is uncertain at times you may want to stay on the safe side.

So the first thing to do in order to sort out your personal finances is to get a good idea of what they are. You must be well aware of what ‘needs’ your money and what ‘wastes’ your money. The first part includes those things that are absolutely essential: things such as food, groceries, health, education, transportation costs, mortgage, etc. These are those expenses that you cannot do away with because they are your daily-life necessities. Still, you should know how much they cost you. The second part is about the things that you spend on but which are not absolutely important for a decent lifestyle. It is the things like dining-out, trips with friends and shopping for fun. It’s good to spend on these things but if you stopped doing so, they won’t have a great impact on your lifestyle.

Once you know these details, you are in a position to trim down the expenses. How do you do that? Once you have made a list of both types of expenses, tick off the things that can be removed or at least reduced. For example, when it comes to trips with friends, you can eliminate them or reduces them from once a month to once every 6 to 8 weeks instead.

The new routine may be a little difficult. But soon, when you find yourself with a handsome amount of money saved by the end of the month, you’ll start to feel better about things plus, it will let you do a lot of things you’ve been planning, for instance, taking your family on a long trip or exchanging your car for a better one. Or perhaps you can ready yourself to pay the expenses of your kids future as they move from high school to college. In either case, a good management of personal finances is a useful and profitable choice.

Stock Investing Tips

Good stock investing entails sound investing tips and methodical strategies. This article will amplify some stock investing tips and intend to tell you how they can be utilized to aid you invest in stocks that will perform better in the market and give you a higher yield in the market.

At first you should comprehend that no system is sure fire to succeed, otherwise every investor would be an investment millionaire. What you have to do is to put into practice several elements from different strategies along with common sense and utilize your instincts and you will really be well on your path to success.

There are no golden stock investing tips that can be utilized to give you the answer to the question of ‘will this company be a success’. What you have to do is peruse and scrutinize all of the data; balance sheets, margins, debt ratios, earnings growth, cash flow, price earnings ration, capital adequacy ratio, dividend yields, dividend payout ratios, market share, variable expenses, balance sheet health, turnover, costs and similar aspects of the operation. When going over at this data do not attempt to isolate each of these. Consider all these statistics as one holistic approach.

You should always mull over some intangible factors juxtaposed with the numbers and ratios that are readily available and certain. Try to examine the culture of the business enterprise, the staff it has, does it have any patents on goods that may potentially become prolific?

The key to successful stock investing is being able to scout for the pertinent numerical and intangible information available about the business. You can get the information from a host of sources such as the internet, newspapers, visiting the companies themselves, utilizing their products or services or talk to someone working in the company. Once you have gathered the information, a good and successful stock investor would then filter out the useful, pertinent information that can help pave to future income or growth potential.

Practical Stock Investing Tips

It is quite undeniable that there are already a lot of ways on how to generate money. However, not all of these ways are deemed to be effective and legal. But are you aware that one of the best ways on how to acquire a great amount of cash is through embarking in the world of investing? This is really true since stock market investing is very lucrative. You only need to arm yourself with practical stock investing tips in order to ensure success in stock market investing as well as to minimize the potential risks and losses.

Embarking on stock investing is without a doubt profitable but it is not an easy thing to do. Thus, the following are some investing tips which you ought to consider when it comes to stock investing:

o Never invest money which you cannot afford to lose. Stock investing is all about buying and selling of stocks in the stock market. It is quite risky and so, you have to bear in mind not to buy nor sell stocks that you do not want to lose.

o Never attempt to buy stocks that you receive through an email. This is really important particularly if you are doing an online kind of stock investing in order to stay away form the scams ubiquitous in the online world today.

o Shun purchasing stocks when the stock market first opens. This is imperative due to the fact that the prices of stocks are believed to be skyrocketing during the first hour. You need to be patient and wait until the prices become stable before buying your own stocks.

Indeed, ensuring success in the stock market as a simple investor can be done without much trouble at all with practical stock investing tips at hand. In fact, some of the most effective investing tips have already been stated above. All you need to do is to put all those tips into actions in order for you to already start generating your own money through investing now.

Financial Help For Retirement

Dave, an engineer for 40 years, wants to do something interesting when he retires, and could use a little extra cash for his golf addiction. Sue, who was a legal secretary for 45 years, needs to add to her retirement income. She has no desire to be a store greeter, but wants to bring in extra cash using her skills and knowledge. Both know the importance of staying mentally active as they age.

Retired teachers, accountants, business professionals, managers, secretaries, homemakers and so many others are earning extra retirement income by putting their skills and talents to use as tutors — an idea that appeals to both Dave and Sue. How hard is it to develop a tutoring business, market to potential students, and make this a money-making opportunity?

First of all, if you are not a professional educator, don’t be afraid to consider tutoring. Most of the time, a teacher’s certification is not required to help others pick up new skills or knowledge, so there are many ways to develop a successful tutoring practice – from letting friends and others know that you are available to help students, to signing up with formal tutoring services on and off the Internet, such as, or by offering informal tutoring training simply by advertising with flyers and other marketing methods.

Can you make money tutoring? Tutoring is what you make it; tutors may be paid at the time of service and he amount charged varies. If you work for a formal tutoring organization, you might be paid once or twice a month. Pay is usually based on the subjects tutored and the number of hours tutored. As an example given by one major online college tutoring organization, active Chemistry tutors earn anywhere from $800 to $1600 a month. If you work for a formal tutoring company, you may also receive bonuses, free training and even other incentives. If you are own your own, and not tutoring college-level students, the amount may be less. Yet, highly specialized and niched tutors can make far more, it just depends on the topic and the students.

Of course, tutoring services are not limited to professional teaching areas such as math, English and science. Do you know how to cook vegetarian meals? Bake and decorate wedding cakes?

Win at card games like bridge and poker?

Improvise jazz on a musical instrument?

Play shuffleboard or bowl a good game? Load software onto a computer or get rid of computer viruses? Use graphic or other specialty software?

Plenty of people would like to have these skills – including adult non-students – and many are willing to pay a tutor for this knowledge. All you need are some expertise and experience, and enough desire to go out and market your services.

If you are interested in tutoring for a formal tutoring organization, visit several online services and read their FAQs (frequently asked questions) to learn more about typical tutoring topics, qualifications, and more. For example, the following bulleted points explain what several professional online tutoring businesses serving students in the United States and Canada see as important qualifications:

• Live in and be eligible to work in either the US or Canada and have a valid Social Security or Social Insurance number

• Have a strong content knowledge in English, math, science, or social studies at the level you wish to tutor- for services covering elementary grade through first year college

• Be able to explain concepts to people of a variety of ages

• Currently be enrolled in or have graduated from an accredited US or Canadian College or University degree program

• Pass more than one subject exam during the application process

So if tutoring – formal or informal-still sounds like a possibility, here is a quick list of even more questions and ideas to help you get started, whether or not you plan to tutor in a formal or informal environment:

1. What skills, training, experiences do you have that others might need or enjoy having? Do you knit sweaters? Are you a certified Reiki Master? Do you like to coach? Do you play a mean game of bridge? Are you a native speaker of any language? This list goes on and on and once you get started, you will probably think of many things that you do well, activities that you could help others acquire.

2. Whom do you want to teach (or train) – children or adults? Business owners? Other retirees? Best to figure this out first. When you think about tutoring, you typically are considering the needs of children. However, adults often need help too – with both formal and informal activities – from math to planting a garden or learning how to remove viruses from their computers. Adults usually do not usually seek out special tutoring – you may have to find these customers and tantalize them through bulletin boards flyers and handouts, or even by giving free programs to groups and organizations and demonstrating your skills. Pass out flyers, business cards and have a drawing for one free lesson at this event.

3. Decide on what areas are best for your tutorial services. You may need to brush up on the subjects you feel you are most proficient in – and then you will probably have to practice before asking for payment. A clever way to learn what services are needed, is to ask around. Talk to ministers, business people, club members, friends and get their ideas. Then keep them informed about what you are doing, and they will often tell others, especially if you give them some business cards or flyers once you decide on what your will be offering as a tutor.

4. What are people typically charging for tutoring or classes? Ask around, check out bulletin boards and look at online resources such as Craig’s List. Ask friends what they would consider paying for a cooking or gardening lesson. (Again, this is a good marketing technique because friends will often make referrals for your tutoring services.) If you are seeking formal tutoring opportunities, do some searching on the Internet. Also, look for tutoring classified ads in college and/or local newspapers. You do not want to set your price too high or too low-too high, and you will not find many students, too low and you might end up with too many takers.

5. Look on the Internet for clients. Many job forums and employment sites advertise for tutors. Search the Internet for tutoring; if you live in Albuquerque, New Mexico, Google: tutoring jobs Albuquerque, and see what comes up.

6. Another way to pick up formal tutoring work is to visit a school principle, teacher or professor and let them know that you are available. Bring a resume or something that shows you have expertise (degrees, certificates, and letters of recommendation) and they may be willing to make referrals. Do a good job, and this could be a constant source of clients.

7. If you are seeking informal tutoring experiences, visit local community centers. Many organizations already offer adult, adolescent and child education and will be interested to see how you can help. They might suggest that you teach a specific class for a small fee, and keep most or all of what you collect. Or they may have a special program, often in adult literacy, where you can fit in as an unpaid volunteer. Classes are good public relations for such organizations and so there are often many opportunities in this venue. Working first as a volunteer can also help a new tutor get needed experience before charging for services.

8. You may want to advertise in a local newspaper, a shopper or on the Internet, for both formal and information tutoring opportunities. If you are offering something really unique, a reporter might even write a feature article. If so, clip it out and make copies to use in your flyers and on your web page. Having your own web page could help, but word of mouth often attracts customers, along with specialized flyers detailing what you are offering and your expertise. Social media such as Facebook can help you get out the word, too. Do a good job, and your students (and those who initially refer your services) will be your best referral sources.

9. Keep track of all of your expenses. You will need this information to offset added retirement income, in many cases. For more information on this important matter, visit your social security office and ask questions about retirement income requirements, or talk to your accountant.

Will your brain benefit from tutoring? Of course, especially since 65 is no longer the onset of old age, but the beginning of middle age, and one critical key to staying this “young” is by keeping one’s mind active and engaged, according to many aging specialists.

“Brains like problems. They like something to puzzle over and figure out. Brains love making new connections and learning. It keeps them healthy. Be sure to make your brain happy in retirement. Avoid routine and keep the brain supplied with new and challenging thoughts.

“From puzzles to learning new skills, more and more research shows that brain aging depends on constant intellectual stimulation for the brain,” Dana Anspach of Money Over 55 states. A retirement planner, Anspach serves as Chair of the Practitioner Peer Review Committee for the Retirement Management Journal, a publication issued by the Retirement Income Industry Association.

So…learning new things, teaching and staying smart — all important components of tutoring — are activities that retirement specialists like Anspach tell retirees to do, that is, if they want to stay young as long as they can.

Financial Advisers

There are several different types of financial advisers in the UK and, if you are currently looking for financial advice, it is important to you that you understand the main differences between them. Just as not all medical professionals are the same – there are paramedics, auxiliary nurses, nurses, GPs, registrars and consultants, for example – neither are all financial advisers the same!

Types of Financial Advisers

There are three main categories:

  1. Tied advisers, who usually work for a bank or an insurance company. They are only authorised to advise you on their own company’s products;
  2. Multi-tied advisers, who are able to offer advice from a limited set panel of companies;
  3. Independent financial advisers (IFAs) who will offer you unbiased advice from the whole of the market.

The Importance of Independent Financial AdviceIFAs differ from tied and multi-tied advisers, not only because they offer whole of market advice, but also because they do not represent a company – they act as the representative of their client, and it is their primary responsibility to act in the best interest of their client at all times. IFAs must also offer clients the option to pay by fee, rather than commission from the product provider.

Once an IFA has carried out a detailed fact find with you, so that he (or she) can fully understand your current financial situation, as well as your financial needs and objectives, he will go away and do some research to find the most suitable financial products for you. He will then present his recommendations to you at a follow-up meeting.


Minimum qualifications: All advisers giving investment advice must have the minimum qualifications of the Certificate in Financial Planning (CertPFS) or its predecessor the Financial Planning Certificate (FPC) from the Chartered Institute of Insurance (CII), or the Certificate for Financial Advisers (CeFA) from the IFS School of Finance.

Higher qualifications: By the end of 2012 advisers who wish to continue to give investment advice must have achieved higher qualifications – either the Diploma in Financial Planning (DipPFS) from the CII, or the Diploma for Financial Advisers (DipFA) from the IFS. Roughly one third of all financial advisers in the UK are currently qualified to this level already. The others are studying hard!

Certified Financial Planner: This is an internationally recognised qualification for financial advisers all over the world. In the UK it is awarded by the Institute of Financial Planning (IFP). To become a Certified Financial Planner (CFP) a financial adviser must first hold the DipPFS, or equivalent qualification, must have at least three years’ relevant financial services experience and must have worked on a case study to produce a detailed financial plan of a sufficiently high standard to be passed by the IFP examining board. They must be members of the IFP, abide by a strict code of ethics, and commit to continuing professional development (CPD).

Chartered Financial Planner: To become a Chartered Financial Planner – the pinnacle of the financial planning profession – an adviser must be a member of the Personal Finance Society (PFS), have a minimum of five years’ relevant experience and commit to continuing professional development. He or she also has to gain the CII Advanced Diploma in Financial Planning, which is the highest qualification currently awarded by the CII to financial advisers. The CII operates a points system for its Financial Services exams. For example you must achieve 70 points to be awarded the Certificate in Financial Planning and a further 70 points to be awarded the Diploma in Financial Planning, making a total of 140 points. However, to be awarded the Advanced Diploma in Financial Planning the candidate has to gain 290 points – more than four times the minimum requirement for financial advisers!

CFPs and Chartered Financial Planners are the elite of the financial planning profession. They have demonstrated, not only advanced technical knowledge and financial planning expertise, but also an exceptionally high level of commitment to their clients by the time and money they have spent in attaining their qualifications to enable them to give the highest level of advice.

Do financial advisers’ qualifications matter? Certainly there are many excellent advisers who do not have higher qualifications (yet). However, if you had a serious illness, you would expect your doctor to refer you to a highly qualified and experienced consultant would you not? CFPs and Chartered Financial Planners are like the consultants of the financial planning profession and the good news is that, unlike in the medical profession, you can consult them directly.

Finance Tips For Young Adults

Finance Tips For Young AdultsIf you recently graduated, or simply consider yourself a young adult, you should take time to develop a solid financial plan. This may not be the most important thing on your mind right now, but it really should. Even if you think you still have plenty of time to build up a retirement fund or to save up for a house – think again. The biggest benefits in growing your fortune come from the time passing by. Yes – the more time you have the more value you can get out of the money you are able to earn and invest.

You will now learn about a few very simple steps that you should take right now, a few easy decisions that you should make to significantly improve the quality of your life in the future.

Set up an emergency fund

I know that this may sound ridiculous to you at the moment, when your income hardly covers your expenses. But it’s never too early or too late to start an emergency fund. Think about it – even if you develop a perfect personal budget, you can never take everything into account. There will always be unexpected expenditures. Maybe your car will break down next month or you will need a new resource for your studies. It would be very smart to have a separate account from which you could borrow the money rather than charging it on your credit cards, wouldn’t it?

You can start right now by putting aside small amounts of money into a separate account every time you receive your salary or get a bonus. Just start immediately – don’t think about it too much.

Later, when your budget allows it, you should consider building up a bigger emergency fund – maybe equal to your 3 to 6 month salary. This is for bigger emergencies like losing your job or getting seriously ill. Once again – it’s never too early to start your own emergency fund.

Plan your retirement

I know – no one thinks about their retirement when they are in their 20s. If I can teach you one thing about saving for retirement – time is a huge factor. If you start earl enough, even very small monthly savings will lead to nice retirement fund. A popular suggestion is to put aside 10% of your income every time you receive your salary. I would say – start with whatever you can – just start right now. Remember that planning for your retirement is very important even at young age. Compound interest does a great job increasing the value of your investments – the only thing needed is time.

Start saving for a house

Even if you are not planning to buy a house for a while, you could still start putting aside some money for a down payment. Of course it is possible to buy property with no down payment, but this will only increase the overall cost of your mortgage. In many cases, without a 20% down payment, you will be obliged to purchase private mortgage insurance, which will considerably increase your monthly payments.

It’s unfortunate that personal finance hasn’t yet turned out to be a compulsory subject in schools or colleges. So a lot of people out there are fairly naive about managing their money.

But this doesn’t actually mean that personal finance will always be way above your head! Frankly speaking, it doesn’t take too much to roll back on the right path. Just read this article to know how to craft your own strategy. Fortunately, you don’t have to be good at math to grasp the ideas!

Use self control

May be you were taught by your parents about this when you’ve in your childhood. Just in case you haven’t mastered it, it’s not too late. Almost everybody found success in life through delaying gratification. If you can do it, it’ll be easy for you to have your finances nourishing.

True, you can easily buy something on credit the moment you want, it’s a better idea to wait till you’ve saved up that much. Do you love paying interest on your new pair of shoes or jeans or a bottle of milk? Avoid putting each and every purchase on your credit card.

Take full control of your financial future

Unless you learn to smartly manage your money, others will figure out ways to easily (mis)manage it. Unfortunately, some of them are ill-intentioned (e.g. crooked commission-based, so called financial planners).

At the same time, others might be pretty well-meaning, but might be totally ignorant about what the consequences of their actions are (e.g. Grandma wants that you buy a new house despite the fact that you can at best afford one of those double-crossing adjustable-rate mortgages). So do not rely on other people’s advice. You should rather take charge of your finances and research on some basics on management of personal finance.

Know where all your money goes

When you’ve read a few books on personal finance, you’ll know the importance of keeping your expenses below your income. The finest way of doing this is – budgeting. Once you’ve realized how the seemingly negligible things are adding up at the end of the month, you’ll know how to control that.

Same goes for recurring expenses. If you avoid wasting money on the luxury apartment now, chances are high that you’ll be capable of affording a great condo or a new home even before you know it.