Is Your Financial Advisor Going to Have a Better Retirement Than You?

In the wake of the Wall Street scandals, wealthy investors and affluent retirees are asking some tough questions about financial planning. Is my financial advisor trustworthy? Is my financial advisor competent? Is my financial advisor objective? If investors knew those answers were yes, they would certainly sleep better at night. A new organization, the National Alliance of Objective Financial Advisors, has created the most stringent due diligence process in the financial advisory industry. Part of this process includes a background check to:

• Confirm their expertise and competence in Comprehensive Financial Planning
• Confirm that no disciplinary action has been filed against the advisory firm.
• Confirm that no complaints or criminal records have been filed against the advisory firm.

The personal financial planning industry has two types of advisors. The first type uses an objective process that benefits their clients. They are only paid by the client for their advice. The second type of advisor is paid commissions for selling insurance, annuities and mutual funds. Too often, these products are not in the client’s best interest. But it’s a primary way these advisors are compensated so a strong conflict of interest exists. Unfortunately, busy people sometimes don’t know the difference between these two types of advisors. Too many people are being sold products that will adversely affect their tax planning or the way their retirement years are spent. The Alliance was created to solve this problem. It consists of a group of independent advisors who have proven their trustworthiness, objectivity, and competence and who comply with a strict code of conduct and ethical guidelines that require them to put their clients’ interests first.

More people than ever are looking to financial advisors for advice because they don’t want to spend their time following the market or keeping up with the constant changes that will affect their estate planning objectives. Handling money is more complicated than ever. During the boom years, many people handled their own finances. When the market did well, everyone was an expert investor. But now that the market has gotten tougher, people are finding that they would rather not handle their money on their own. 

Allen Hamm, creator and Executive Director, created the Alliance after he observed that investors were being misled by some advisors. He has been a consultant to financial advisory firms for 22 years on the subject of long-term care planning. He’s seen the best and worst that can happen to people who have hired a personal financial advisor.

He’s seen unscrupulous personal financial advisors:

• Sell life insurance policies on children.
• Sell long-term care insurance to people who shouldn’t have it.
• Sell expensive loaded investments that erode assets the client had earmarked for retirement.

The due diligence process that Alliance members must pass is his way of making sure more people protect their assets and have the carefree retirement they dream of. All Alliance members abide by a strict code of ethics, which includes a pledge that they will not receive commissions or kickbacks from vendors, including insurance companies.

The Alliance can refer people to an advisor in their area that has passed the stringent criteria required for membership. The referral service is complimentary to investors. The Alliance is paid membership fees by the advisor members. The fees support the advancement of objective financial advice and pay for the occasional referral received through the Alliance.

Investors can make sure they have the right financial advisor by requesting a new, free report called “15 Questions You Must Ask to Assure Your Financial Advisor Is Protecting Your Best Interests.” The report is available at http://www.objectivefinancialadvisors.com.