Tuesday, November 25, 2008

Financial Planners vs. Psychics

Looking for a new career? Facing pay cuts or, worse, pink slips? Wondering where the money is these days? Well it may be time to polish that crystal ball and peer into a new profession. As a vast number of industries experience the sharp blow of our weakened economy, one industry appears to be thriving: the divination arts. That's right: in a time of dwindling business, psychics are enjoying a lucrative wave of popularity.

While previous visits to the psychic may have involved questions about a spouse's fidelity or on the future of your love life, psychics are noticing an increase in economy-related shop talk, along with a significant increase in business. According to Ryan Singel at WIRED magazine, "internet psychics across the board saw a spike in traffic in the days following the initial market crash." Psychics are now fielding questions that may have previously been directed at a financial planner or job counselor: What should I do with my money? How do I avoid getting laid off? Ruth la Ferla at the New York Times says "These days, [psychics] are besieged with questions about whether a pink slip is in the cards, whether a condo will sell, or whether a company will continue to prosper."

If you're interested in receiving assistance on money matters, but don't want your advice to come from a pack of tarot cards, consider hiring a financial planner. Here are the top 3 questions to ask a financial planner, from the Certified Financial Planner Board of Standards:

1. What Experience Do You Have?
Find out how long the planner has been in practice and the number and types of companies with which she has been associated. Ask the planner to briefly describe her work experience and how it relates to her current practice. Choose a financial planner who has experience counseling individuals on their financial needs.

2. What are Your Qualifications?

The term "financial planner" is used by many financial professionals. Ask the planner what qualifies her to offer financial planning advice and whether she is recognized as a CERTIFIED FINANCIAL PLANNER™ professional or CFPR practitioner, a Certified Public Accountant-Personal Financial Specialist (CPA-PFS), or a Chartered Financial Consultant (ChFC). Look for a planner who has proven experience in financial planning topics such as insurance, tax planning, investments, estate planning or retirement planning. Determine what steps the planner takes to stay current with changes and developments in the financial planning field. If the planner holds a financial planning designation or certification, check on her background with CFP Board or other relevant professional organizations.

3. What Services Do You Offer?
The services a financial planner offers depend on a number of factors including credentials, licenses and areas of expertise. Generally, financial planners cannot sell insurance or securities products such as mutual funds or stocks without the proper licenses, or give investment advice unless registered with state or Federal authorities. Some planners offer financial planning advice on a range of topics but do not sell financial products. Others may provide advice only in specific areas such as estate planning or on tax matters.

Check out the rest of the CFP's "10 Questions to Ask When Choosing a Financial Planner" list here.

"In Troubling Economic Times, Consumers Flock to Online Psychics" [WIRED]
"Love, Jobs and 401(k)s" [The New York Times]

1 comment:

San Francisco Financial Planners said...

great advice for those looking for a financial planner. I'd also recommend that you remember to Try to find a planner who is at about your same life stage so that they have a good understanding of where you are and where you want to be. For instance, I have two young children and my whole practice is geared towards new and expectant parents. I am highly tuned into the challenges that come with a growing family and can closely relate to my clients. On the other hand, I wouldn't take on a client who is nearing retirement, since I don't have as much insight to their goals and worries.