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DOUBLE CHECK YOUR ADVISER’S CREDENTIALS
by Sarah Zanoff
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(January 5, 2009 - Monday) - They might not have as much experience as you think they do. Some potential retirement advisers might have multiple certifications attached to their name, but they do not necessarily come from a legitimate source. There is a possibility the initials could simply be an advertising ploy to gain your business. An example from Money Magazine:
Earlier this year, a reader e-mailed me to say he'd met with an adviser with a Wharton Certificate in Retirement Planning. How much credence should he give it?
What I found is that the certificate is available only to advisers affiliated with the insurer AXA who attend a five-day program at the Wharton School. There's no final exam, no grade. I don't want to suggest that the program is a sham. It is taught by Wharton professors, and AXA sends only experienced advisers. Then again, it's not exactly a Wharton M.B.A.
When a designation does connote a special skill, consider how relevant that expertise is. The Certified Senior Advisor designation, while legit, is largely meaningless as a gauge of retirement planning proficiency.
Why? Its purpose is to increase awareness of the aging process. It requires no special financial training.
Walter Updegrave, Don’t judge an advisor by his initials, Money Magazine, Dec. 1, 2008. http://money.cnn.com/2008/12/01/pf/advisor_initials.moneymag/index.htm?postversion=2008120110
Another avenue to checking the history of your potential adviser is to perform a background check. This action could identify any consumer complaints or other disciplinary actions against them. Your state securities commission (nasaa.org) and state insurance department (naic.org) are both resources at your fingertips.
In early 2008, prototype regulations were approved to control the credentials that adviser’s have attached to their name, ensuring they are from a justifiable organization or accrediting group. These regulations are expected to be implemented by most states in 2009.
By Sarah Zanoff
THE HAYES LAW FIRM, www.dhayeslaw.com
4265 San Felipe, Suite 1000
Houston, TX 77027
Phone: 713-622-7271, Toll free: 1-866-332-3567
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