Who needs a financial planner? You do if you want to save, invest and grow your money and you have no clue as to how to get started or the best ways to achieve your financial goals.

Better Business Bureau of Southern Arizona warns that financial planning is an unregulated profession, which makes it imperative that potential clients check out financial advisers before doing business with them. CFP – short for certified financial planner – is the most significant credential. It means the individual has passed a rigorous test administered by the Certified Financial Planner board of Standards and regularly engages in continuing education.

A good financial planner should help you get a clear picture of your financial situation and lay the foundation for future investment decisions. Beware of planners who offer few or no alternatives in your investment plan, and avoid planners who use high-pressure sales tactics or promise unusually high rates of return on investments. Be on guard for possible Ponzi schemes masquerading as tax shelters, precious metals, commodities, high-tech stocks and other investments.

After you’ve gathered names of potential planners and checked them out with BBB, schedule exploratory meetings with each, where you’ll ask the following:

What is your professional background? Look for a strong track record of education and job experience covering a broad spectrum of financial planning needs. Ask whether he/she takes advantage of continuing education and training.

How long have you been a financial planner? Look for three or more years of experience and several more years of prior experience as a broker, insurance agent, accountant or lawyer.

Will you provide references? Get names of three or more clients whom the planner has counseled for at least two years. Ask them about their level of satisfaction, investment returns and intentions of staying with the planner.

What professional/trade organizations do you belong to? Membership in an industry group indicates the planner has met certain standards and requirements. Ask for an explanation of any title used by the planner, and about the requirements for use of the title and membership in, or certification by, the organization.

How do you get compensated? If the planner earns a commission, ask if he/she offers investments from one specific company or from many providers. If services are fee-based, find out how they are determined and what you’ll receive in return.

For more consumer tips and information, visit www.tucson.bbb.org.

Investments take risk; sometimes a little, sometimes a lot. But smart investors know that the best way to minimize risk is to educate yourself about your basic rights, the protections you are entitled to under the law, and the common scams and frauds to avoid. Better Business Bureau of Southern Arizona has teamed up with the FINRA Investor Education Foundation to bring you up-to-date research and tools on investment fraud at BBB Smart Investing.

Studies have shown that investment scams have risen in the last decade. Baby Boomers are managing their own retirement funds and are particularly vulnerable. In 2011, according to the North American Securities Administrators Association (NASAA), state and provincial regulators in the U.S., Canada and Mexico launched more than 2,600 administrative, civil and criminal enforcement actions involving investors, 1 in 5 of whom were seniors.

The Financial Industry Regulatory Authority (FINRA) suggests three key steps to take before investing:

Check out the seller. A legitimate investment professional must be licensed. Before giving out your personal information, ask whether the seller is registered with FINRA, the Securities and Exchange Commission (SEC) or your state securities regulator. Find registration and other information on individual brokers, securities firms and investment advisor firms at: www.SaveAndInvest.org/CheckSeller.

Ask questions. Are you licensed to sell this investment to me? Is this investment registered with the SEC?

Check out the investment. Check whether the investment itself is registered. Confirm whether a security is registered with the SEC and get access to a company’s financial information by using the SEC’s EDGAR Database. Learn how at www.SaveAndInvest.org/CheckInvestment.

For more information on protecting yourself from investment fraud, visit www.bbb.org/smartinvesting and www.saveandinvest.org.

Better Business Bureau of Southern Arizona is warning potential investors to be on the alert for unsolicited phone calls from salespeople offering to set them up with web-based stores or other Internet business ventures.

Consumers nationwide say they lost hundreds or thousands of dollars to telemarketers who took their credit card information in exchange for promises of future business income. Many complaints involve companies based in or near Phoenix. The businesses include Web Media, Web Media Blogging, ITech Financial Group, Web Media Malls and UPG Marketing.

An attorney in the consumer protection division of the Arizona Attorney General’s Office called the Phoenix region “the Silicon Valley” for Internet investment schemes. She said complainants often claim to have lost $40,000, $50,000 or more.

Kim States, BBB President, said the companies typically prey on seniors and the unemployed, who may be vulnerable to high-pressure sales pitches.

“These callers can be very convincing,” States said.  “They know exactly what buttons to push to get (more…)