Did SEC commissioners make it easier or harder on investors?   When we last checked in on the SEC, they were seeking to toughen rules regarding the regulation of broker-dealers.  The talk was that it was high time we held broker-dealers to a fiduciary standard and require them to put the investors best interests at the forefront when discussing investment options.

After a June 2019 vote, the new Regulation “Best Interest Rule” was adopted by a 3-1 margin.  But it always seems like there has to be a great deal of give and take, and “vague or subjective” verbiage in every Regulation. It appears this time was no different either. In a recent consumer test, AARP in association with the Certified Financial Planner Board found most investors reported they were more confused by the disclosure forms than ever before citing they couldn’t “understand what was being disclosed!”

This issue critically impacts those planning specifically for retirement.  Investors lose $17 Billion annually from their retirement savings because advisers put profits ahead of their client’s well-being.  So how do you choose the right adviser?   Check out our Five Commandments below:

  1. Make Sure Your Priorities Are Aligned

When preparing for retirement, you and your financial adviser should be on the same page. The right professionals can provide the guidance and solid, objective judgment needed to help you achieve your financial goals.

  1. 2. Ask Questions

You must conduct your own diligence as there are an abundance of financial vehicles available, each boasting different features.  Investigate, ask questions so you can understand the details, benefits and restrictions of your options as they pertain to your goals.  It’s your money not theirs!

  1. Understand the Fees You Are Paying

An investment fee analysis can show you precisely how much you’re currently spending in annual fees on your portfolio. You deserve to understand how your financial adviser is compensated as well as any associated costs and fees. If he’s getting paid whether you earn or lose you need to make sure everything is in alignment with your future.

 

  1. Exercise Caution with your approach to Online Resources

The internet contains a wealth of information but understanding what’s credible and what isn’t can be like going thru an endless maze of information leading you to confusion and paralysis. Evaluate credibility by reading the site’s “About Us” page and looking at the page’s URL. If it ends in .org or .edu extensions used by nonprofit organizations and educational institutions—it might be considered more reputable than others.  Don’t forget you can go to www.finra.org to check out a prospective advisor.

  1. Study Their Education & Look for Experience

To help you assess just how well-versed your potential financial professional team is, ask how they invest in their education. Beware of financial professionals who simply pass an exam to earn a designation and never commit to ongoing education beyond that point. They must keep current ask how they do it.  Of course, no single person can know everything, so it’s important to have a well-organized team of professionals help you plan for retirement. Your team might include a CPA or qualified tax professional, an estate planning attorney, a Registered Investment Adviser or Investment Adviser Representative and a licensed insurance agent.

Finally, be aware that even if you’ve worked with a professional before he/she may not be experienced specifically in creating tax-efficient retirement income plans that use the least amount of your savings to produce the optimal amount of lifetime income. Get a second opinion!  Even if you’ve worked with these people for years, they may not be experienced specifically in creating tax-efficient retirement income plans.

Remember, nothing can replace the value of a team of trustworthy, experienced professionals recognized for their work in financial services and specifically in retirement income planning. Your financial adviser should be committed to the financial success and confidence of each and every client served and should help you feel confident about your future.

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