Q&A: How to make sure your financial planner is looking out for you

Dear Liz: As a recent retiree, I opened an IRA with a well-reputed, independent financial planner. I was assured of our fiduciary relationship and told “besides, it will soon be law” that advisors will have to put their clients’ interests first when offering advice about retirement funds.

I guess that whole “soon to be law” thing is out the window along with many other consumer protection regulations. My question is, should I ask my advisor to reaffirm our relationship formally and if so, is there a mechanism available to me to assure this relationship?

Answer: Technically, the U.S. Department of Labor fiduciary rule for advisors is still scheduled to begin taking effect in April, despite fierce opposition from the financial services industry. The Trump administration, however, has asked for a review to see if the rule should be modified or scrapped. That has been widely taken as a signal that the rule may never be enforced, even if it does go into effect.

So yes, retirement savers should continue to be skeptical. One way to make sure that your advisor is ready to put your interests first is to ask him or her to sign the fiduciary oath that you can find at www.thefiduciarystandard.org. The oath was created by a group of financial advisors who think that advice should always be in the clients’ best interests.

Retirement advice from retired financial experts

Most retirement advice has a flaw: It’s being given by people who haven’t yet retired.

So I asked money experts who have quit the 9-to-5 for their best advice on how to prepare for retirement.

In my latest for the Associated Press, what the experts say you can do to prepare yourself both financially and mentally.

The money numbers you need to know

lighting-calculation-1000Some numbers matter more than others. How much you make is important, for example, but your financial health depends far more on how much you keep.

Knowing certain numbers can help you understand how well you’re converting income into wealth, as well as the impact of your spending and tax situation on that process. In my latest for the Associated Press, the calculations that can help you make better decisions.

Thursday’s need-to-know money news

W-2 Tax heroToday’s top story: What you need to know about your W-2. Also in the news: How the “Five-Finger Checkup” can save your financial life, the best method for paying off different kinds of loans, and apps that will help manage your money.

6 Things You Need to Know About Your W-2
Deciphering what it means.

How the ‘Five-Finger Checkup’ Can Save Your Financial Life
One question for each finger.

The Best Method for Paying Off Each Kind of Loan
You need more than one strategy.

7 Apps to Help Manage Your Money
Help is at your fingertips.

Tuesday’s need-to-know money news

Zemanta Related Posts ThumbnailToday’s top story: NerdWallet dads share their personal finance tips. Also in the news: Why college grads need more education, how minimalism can help your wallet, and what the Fed meeting means for investors and home buyers.

NerdWallet Dads Share Their Personal Finance Tips
Learning from the dads.

College grads are educated, but not in matters of personal finance
More education is needed.

8 Ways Minimalism Can Help Maximize Your Wallet
Less can equal more.

What Fed meeting means for investors, homeowners/buyers
Keeping an eye on interest rates.

Q&A: Giving financial advice to family

Dear Liz: I am 30 and have two sisters, ages 31 and 27. My wife and I both have good jobs that allow us to live comfortably and save for retirement. My sisters, on the other hand, have severe money problems. My older sister works a low-paying retail job. She is unable to save and is currently at risk of having her wages and tax refunds garnished because of unpaid student loans. My mom provides her with support when she asks for it. The other sister still lives at home. While she makes decent money by working two jobs, she spends all of her money on “wants,” and my mom pays all of her living expenses. The only bill my younger sister pays is her car payment. She also currently has close to $100,000 in student loans that she just had to start paying on.

I have tried to provide both my sisters with budgeting advice, and I have recommended books that I have used as the blueprint for our budget. Neither of them takes the advice. I have talked to my mom about both sisters’ situations. While my mom agrees that both are in bad shape, she is unwilling to show either of them the tough love that they need to improve their situations. Do you have any advice on recommendations that I could make to help any of them out?

Answer: The best advice is to stop offering advice.

Your mom and sisters have made it quite clear they’re not interested in what you have to say. Continuing to offer your opinions on their situations would be tiresome and pointless.
Yes, it’s hard to watch people struggle when you think you know what could help them. But keep in mind that: a) you might be wrong about what they need right now, and b) nobody asked you, anyway.

If you’re passionate about teaching people to manage their finances, you might look into becoming a certified financial planner or other planning professional. The CFP Board of Standards has information at http://www.cfp.net. If people are paying you for your advice, they’re somewhat more likely to listen to it.

Otherwise, you’ll have a captive audience for your financial teaching if you and your wife should have children. And as a parent, you’ll get to experience firsthand how it feels to be the target of unsolicited advice.

Monday’s need-to-know money news

elephantToday’s top story: It’s time to stop ignoring your finances. Also in the news: The best ways to invest in real estate, how to get help for financially assisting your parents, and how you can get rewarded for saving money.

How to Stop Ignoring Your Finances
You can’t keep ignoring the elephant in the room.

The Best Way to Invest in Real Estate
You don’t have to flip houses in order to profit from real estate.

3 Ways to Get Help for Financially Aiding Your Parents
Help is available during difficult times.

Goal-Based Accounts Reward You for Saving Money
Get rewarded for reaching your goal.

How Your Friends Threaten Your Finances
You don’t have to keep up with the Joneses.

Thursday’s need-to-know money news

Zemanta Related Posts ThumbnailToday’s top story: What to expect when you’re hit with a penalty APR. Also in the news: What to do when your home equity line is about to end, everything you need to know about personal finance in 100 words or less, and stories from America Saves Week.

Am I Stuck With a Penalty APR on My Credit Card?
How long until you can get your old rate back?

What to do if your home-equity line is about to end
What to do before your month payment shoots through the roof.

Everything You Need to Know About Personal Finance in 100 Words (or Less)
Short and sweet.

12 Personal Finance Stories For America Saves Week
Learning from others.

What The NCAA Bracket Can Teach You About Personal Finance
Be prepared for upsets.

Friday’s need-to-know money news

Today’s top story: How driving could affect your credit. Also in the news: The five C’s of credit, what you shouldn’t do this Christmas, and what we can learn about personal finance from three holiday classics.

How Does Driving Affect Your Credit?
Unpaid tickets could wreck your credit score.

The 4 Judgments Every Lender Makes Based on Your Credit
Introducing the five C’s of credit.

Essential Personal Finance Lessons From Three Holiday Classics
Kevin McAllister, coupon king.

Ten financial don’ts this Christmas
Advice from the experts on what you shouldn’t do this Christmas.

Everything I’ve Learned About Personal Finance in 10 Sentences
Short and sweet advice.