By YOUNG MONEY Staff
1 September 2010

Choosing a financial planner is an important decision - you should approach it with the same level of seriousness that you would apply to buying a house or a car. After all, this person is going to be in charge of managing your life savings and wealth.

First of all, you want to inquire into their professional certification and experience. A planner should probably be a certified public accountant (CPA), having completed a professional course in tax preparation. A personal financial specialist (PFS) is a sub-designation of CPAs, one who has completed further training in estate, retirement, risk management and investment planning.

With the internet on your side, look into the planner's track record, as well as asking for documents proving performance. If someone's investments consistently underperform the S&P 500 over a ten- or twenty-year period, there's not much point investing with them.

Payment schedules are another area to consider. Ideally, you want to avoid commission-based structures - there's a real conflict of interest when an adviser gets paid more to make more trades, eating up your returns with fees.

Depending on your net worth, fees based on percentage of total assets or an hourly rate make much more sense.

Finally, ask around among your network, particularly among individuals with a lot of business and finance experience. If someone has a proven track record of making money, they probably know how to keep it, too.