These Are the New Rules for Finding a Financial Advisor You Can Trust

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These Are the New Rules for Finding a Financial Advisor You Can Trust

Aug 13, 2019

Choosing a financial advisor has always been a confusing, high-stakes decision, and critics say a recent regulation designed to help consumers may actually have made it harder to know whom to trust.

On its face, the new measure, known as Regulation Best Interest, sounds promising.  Adopted in June by the U.S. Securities and Exchange Commission (SEC), it says that broker-dealers must act in the best interest of their customers when recommending investment moves, and that they must disclose any potential conflicts of interest....

But consumer advocates warn the changes amount to little more than a new marketing slogan for brokers, as the SEC doesn't define what it means for brokers to put clients first and allows brokers to disclose, rather than completely eliminate, conflicts of interest....

Amid debate about the new rule's effectiveness, it remains clear that consumers must do their homework when choosing an advisor.  Here's how to protect yourself and your money....

CERTIFIED FINANCIAL PLANNER™ Professionals: Both brokers and registered investment advisors can hold the rigorous CERTIFIED FINANCIAL PLANNER[™ certification] from the Certified Financial Planner Board of Standards.  This means the advisor has at least several years' experience in the field, has completed a comprehensive financial knowledge test and agreed to undergo continuing education and ethics classes.  Read more >

By Kerri Anne Renzulli and Alix Langone
August 13, 2019

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Did You Know?

Among clients who work with an advisor, 87% of those working with a CFP® professional are satisfied or very satisfied, compared with 72% of those who work with an advisor without certification.
Anyone can call themselves a “financial planner.” Only professionals who meet CFP Board’s rigorous standards can call themselves CERTIFIED FINANCIAL PLANNER™ professionals.
The 2013 Household Financial Planning Survey shows that those with a financial plan feel more confident and report more success managing money, savings and investments than those without a plan.
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