Where and how do I find an honest financial advisor with a financial institution?
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That's really tough. I can't tell you how many "advisors" are actually salesmen but that doesn't mean that good advisors don't exist.
Step 1: Ask people you know who they use and what they like about that advisor. Also, ask what they may not like about their advisor. Do a web search or look at the FPA website for a financial planner.
Step 2: Interview a few advisors. Most don't charge for an initial consultation. The hard part is not to get suckered into the sales pitch. Instead find out what they will do for you. How often will they meet with you. What services do they provide? How do they choose the investments that they are currently using for their clients? (if you ask how they'll choose an investment for you personally you'll hear about them finding out your risk tolerances, time frame, etc but if you ask how they choose the things they are currently using you'll be surprised how many people can't answer that well. I'd be suspicious of someone who couldn't articulate *why* they are would invest your money in this fund or that stock). oooh - another informative question to ask is if they've ever turned a potential client away and why they did that. That will tell you a lot about the advisor and the type of client that advisor is most happy working with. (Beloved clients get the most attention)
Step 3: find out how they are compensated. The trend in my industry is managed accounts (wrap accounts is another name you'll hear) where the advisor charges a percentage of the assets they are managing. Usually the fee is in the neighborhood of 1% to 1.5% annually. As you interview several advisors, you'll get a feel for what the going rate is in your neck of the woods. The rationale for charging a fee is that if your investments do poorly, they collect less. If your investments do well, they make more. As opposed to working on commission where they get paid regardless of performance. At least that's the reasoning. But if the advisor does very little trading in the accounts he or she manages, paying commissions may cost less in the long run...That's something you have to weigh for yourself.
Step 4: Be wary of too good to be true scenarios - whether it's the can't miss stock or more commonly, an annuity that is pitched as a can't lose investment. Also keep in mind that very few investments are only available for a limited time. Don't get pressured into a fast move.
As an aside: if you're wondering what an annuity is, when you buy an annuity you're basically buying insurance for your investment. And just like car insurance, it's nice to have it if get in a wreck and need the insurance to bail you out, but if you go 5 years without a wreck, you've paid for 5 years of insurance that you didn't use and you don't get the money back. In my experience the insurance an annuity provides is very rarely used, but your returns will be burdened by the cost of the insurance. One thing an annuity does have going for it is that it's a tax shelter - so if you've maxed out your 401k and IRA and have more money you want to defer taxes on, it may be appropriate.
Step 5: Be willing to pay for their services. If you were trying to beat a murder rap, you'd probably pay for a top notch attorney even though you can get a public defender for free. Same goes for a good financial advisor. Of course, you don't want to be gouged, but you must understand that a really good financial advisor won't work for free. If the advisor is willing to really undercut what everyone else wants to charge you, that advisor is probably be desperate for clients. Bad sign.
Good luck!
I think you are being un-realistic. You have to be a cheat or a theif to even be in that field. Sorry
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