Tag Archives: financial advisor

Psychics- The New Financial Advisors

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It would never occur to me to seek out financial advice from a psychic. But apparently, I’m missing an important resource with which to make financial decisions.  Financial psychics are thriving; in fact, many of their clients are other psychics.

I know a psychic who lives nearby in a modest home. If she’s wealthy, she certainly doesn’t flaunt it, although she does own a shiny new set of tarot cards and a top of the line tape recorder so that clients can refresh their memories about her advice after the session.

Can a financial advisor, with nothing but charts, graphs and numbers compete with the psychic’s reassurance that our cards indicate future wealth? I can’t really blame people for believing that a greater power is attracting them towards the destiny they desire. Investments have always been tricky, and not everyone has the smarts of Warren Buffett.

Apparently, men are more businesslike than women when they consult a psychic. Men ask rational questions like, What is your accuracy rate? Can you guarantee your readings? How do you get your information?

I suspect millions of women ask the same rational questions of their financial advisors. The problem is that neither psychic nor financial guru, pundit or banker really knows what’s going on or how long good times will last. When the market is up, everyone is a hero. When it’s down, only psychics will give you a tape reassuring you of your destiny with wealth.

http://www.marketwatch.com/story/psychics-economic-predictions-provide-financial-guidance-for-many-americans-2013-10-30

Husbands, Financial Advisors and Trust

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A woman called into a talk show where the topic was marital fidelity.Saying she was done with men, the caller ended her commentary by asking “If you can’t trust the person who takes a marriage vow with you, who can you trust?”

I thought about her question as it applies to financial advice. Financial advisors don’t disclose any conflict of interest before taking us on as a client. We can’t check a track record because the names of clients are confidential. We have no way of knowing how well the advisor does in an economic downturn. In an industry rife with conflict of interest abuses, some of which we know, others that we don’t, we would do well to get as much information as we can before we entrust our money to any financial advisor.

When the economy is good, and the market is up, financial advisors can play the hero. When there’s a downturn, they can hold our hand as we rue our losses. The truth is we’re working on trust when we place our money with a firm or individual whose mantra is “past performance is no indication of future results”. The framed certificates on the advisor’s office wall testify to completion of a course of study, not a grade for performance.

Trust is the operating system when we don’t have full knowledge about another person. That certainly is the case when we’re dealing with a  financial advisor. However, when it comes to marriage, which requires no study, no training and nothing but a vow, trust is used interchangeably with love. Unfortunately, love is not a course of study and no one gets a diploma.

Protecting Seniors from ‘Senior’ Advisors

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Be wary of any financial professional with letters after his or her name, especially those who designate themselves as a ‘senior advisor’.

According to a new report from the Consumer Financial Protection Bureau’s Office of Older Americans, Americans over 60 make up 15 percent of the population, but are estimated to account for 30 percent of investment fraud victims. Older people may have money they have saved for retirement, and cognitive decline may make them more vulnerable. They are also more likely to rely on recommendations from someone with a “senior advisor” credential.

That’s the problem. There are currently more than 50 “senior certification” designations in use. Who can tell the difference between  A.R.A., an A.R.P.C., a C.S.A. or a C.R.F.A.?

The Bureau estimates that “tens of thousands” of professionals, including financial advisers, brokers and insurance agents, use some sort of senior credential. That means older adults will continue to be vulnerable to bad advice and even outright fraud.

Initials tell you nothing about a financial advisor’s training .  Some credentials require a specific level of coursework, but others don’t require any.You can find out about the background of thousands of registered investment advisors at  http://www.sec.gov/answers/iapd.htm.

 

 

 

Trust, Husbands and Financial Advisors

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A woman called into a talk show where the topic was marital fidelity.Saying she was done with men, the caller ended her commentary by asking “If you can’t trust the person who takes a marriage vow with you, whom can you trust?”

I thought about her question as it applies to two professions dealing with money- financial advice and accounting. No financial advisor takes a vow before taking us on as a client. We can’t check a track record because the names of clients are confidential. We have no way of knowing how well the advisor does in an economic downturn.

Bottom line, we’re working on trust – giving our money to a firm or individual whose caveat is that past performance is no indication of future results and counsels us on the risks of investment. The certificates on the office wall testify to completion of a course of study, not a grade for performance.

The same holds true for the accounting profession. Most accountants are good at what they do. But they depend on accurate input from us to help us with our tax return. The accountant signs the return based on trust that we’ve provided all the information we’re required to provide. If we’re filing a joint tax return and most of the financial information is handled by our husband because we don’t “do taxes”, we have to trust he has provided accurate information.

Trust is involved in a transaction with someone when we do not have full knowledge about them, their intent, and the things they are offering us. However, when it comes to marriage, which requires no study, no training and nothing but a vow, trust is used interchangeably with love. Unfortunately, love is not a course of study and no one gets a diploma in the subject.