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Chapter 22. Getting Help > Which Way Is Best? - Pg. 229

Getting Help 229 There are also added incentives at times offered by companies to the salespeople who sell their financial products. A planner may need to sell 15 annuities to become eligible for a trip to Hawaii or be the high producer to win a trip to France. Or there could be sales contests as well in which TVs are given away. Always ask a planner how they are being compensated. Don't be embarrassed to ask the awkward questions. Certified Financial Planners (CFPs) are required to disclose their compensation to you. That doesn't mean you can ask to see their 1040. It means they will tell you what they will earn, maybe only in percentages, on the products they sell you. Which Way Is Best? When choosing a planner, look for the characteristics you want in that person and then consider compensation. Issues such as trust, communication, confidence, and education are as important as compensation, perhaps more so. And no one way of compensation is all good or all bad. Cer- tainly, the fee-only planner can offer the most objective advice. But purebred fee-only planners are not very easy to find. They make up less than 20 percent of the financial planning profession. Choosing Your Financial Planner Choosing a financial planner can be one of the most important financial decisions you make-- certainly more important than what mutual fund you should be buying this week. But finding the right advisor may be difficult. For What It's Worth According to Dalbar, an opinion research firm in Boston, the number one issue for a financial consumer who is looking for a financial advisor is not compensation, but trust. People want a planner they can talk to easily and trust and someone they know is working in their best interests. More and more individuals are using financial planners. Our financial lives have become very com- plicated. Years ago when you walked into your local savings bank to get a mortgage, they gave you two choices: Do you want a 30- or 20-year mortgage? Today the bank offers an overwhelming selection of mortgages and rates to choose from. Consequently, many of you may need a trusted advisor to help you through the financial maze, or you will end up like those crazed little mice running through the maze hunting for cheese. So where do you begin to look for someone? Begin by asking your friends, work associates, and relatives if they use a financial advisor. Speak with your other professional advisors such as your attorney or accountant and ask whom they would recommend. There are several professional or- ganizations listed at the end of this chapter that can assist you in your search as well. Just keep asking.