Advice on financial planning consultants

[98HornGirl]

I was talking with a coworker of mine last week who was telling me the best thing she ever did was sit down with a financial planner to re-tool her entire savings and debt reduction plan. This woman doesn't make alot (she's a state employee like me), and is a middle-age single woman with adult kids who still mooch off of her from time to time. I make the point of saying that b/c I always thought of financial planners as someone only highly-employed, wealthy people could afford to use. So, that got me thinking that it might be worthwhile for my husband and I to sit down with someone and get a better gameplan. We're doing OK, but we're in (my) student loan debt up to our ears, have about as much credit card debt as anyone else, are both in need of new cars, and are barely saving anything. I feel like we need a little more help in looking at our savings, 401K investments, credit card payments, etc. to make the most of what we're bringing in.

My question is - how do these people work (i.e., how do they get paid), and how do we find somebody who is reputable and not going to dick us around? Also, if anyone has any recommendations in the Austin/Cedar Park area, that would be appreciated.

Thanks!

 

[chitwood]

PM Puddle/Cruiser. He's an ******* (j/k), but knows what he's doing.

 

[midtown]

Financial planner is a generic term and can and is used by insurance salesman, cpa's, stockbrokers (salesman), etc. Any planner/advisor who is paid any commission has a conflict of interest. If you want a planner get a Certfied Financial Planner (CFP) who is also a member of the National Assoc of Personal Financial Advisors (NAPFA).
The Link

 

[iamtigerwoods]

Pick up a book like Personal Finance for Dummies so you have some sort of base to draw upon before choosing/meeting a planner. Depending on who they work for, each is motivated to move you in a certain direction(stock, life insurance, annuities, etc.) depending on what they get compensated on. They are out to make a living just like you and I....

 

[midtown]

In reply to:

---

---

 

[12thStudStan]

edit

I stand corrected, midtown.


fee only financial planner = financial planner

commission based financial planner = salesman

financial planner that charged you a fee for a financial plan and then sells you something = really good salesman

 

[midtown]

Don't get confused with fee based vs fee only.

Fee based = trying to deceive the public to thinking he/she doesn't receive commissions
Fee only = DOES NOT under any circumstances accept commissions.

Stay clear of any of the big firms, ie Merrill, AXA, AMEX, Smith Barney, etc. These guys are all salesman.

 

[98HornGirl]

midtown - thanks for all the insight and the web link, it was very helpful!