Wednesday , April 17 2024
Inland Empire Business News by IE Business Daily.003
Inland Empire Business News by IE Business Daily.003

Just Say No to Financial Entertainers

As a wealth planner, I’m often asked to speak to audiences of high level professionals: physicians, attorneys, business owners and executives who want advice on everything from growing personal wealth to how to retire early. One of the most frequent comments I hear from these professionals is that while they are interested in learning how to build wealth, they don’t feel they need to establish a long term relationship with a financial advisor because, “I listen to _____ on the radio,” or “I watch _____ on TV every week.” This is unfortunate, because the people they name are not financial advisors; they’re financial entertainers.

The names of financial entertainers aren’t important; what’s important is the fact that they are financial entertainers, period. A financial entertainer is not a Certified Financial Planner™, advisor, or even a broker – and yes, there is a big difference.

That difference is regulation. It’s true that excessive government regulation is a hot button issue among business owners; it’s also true that many entrepreneurs see the absence of regulation as a good thing – and in many cases, who can blame them? If I owned a factory, I wouldn’t want to have the government breathing down my neck about my carbon emissions on a daily basis. Regardless, the fact remains that for certain industries, parameters established by the federal government are absolutely necessary; this is certainly the case for the financial sector, because financial sector businesses handle money. Other people’s money. Your money.

So, how are financial advisors regulated by the government? A licensed financial advisor is regulated by the Securities and Exchange Commission (SEC), and a licensed broker is regulated by the Financial Industry Regulatory Authority (FINRA). These agencies exist to make sure financial professionals are giving you the best possible advice. As a licensed financial advisor and Certified Financial Planner®, I can tell you with confidence that these agencies exercise due diligence when it comes to keeping wealth planners like me in check. We may not have cable TV shows or nationally syndicated radio programs, and we may not sell out arenas when we go on speaking tours – but we do have the watchful eyes of the regulators on us at all times to ensure we are advising you properly, and that’s something the financial entertainers don’t have.

Personally, I would not offer you reckless advice whether I was being regulated or not – that’s just me. But the fact that licensed financial advisors like me are governed by these authorities should give you confidence in us, and less confidence in the financial entertainers in the media who aren’t governed at all. Yes, they have the Federal Trade Commission – but the for the most part, the FTC’s job is to make sure they don’t spout out a swear word on air. It’s not the FTC’s job to scrutinize the precarious advice financial entertainers give on their programs. What set licensed financial advisors apart from financial entertainers are the regulatory agencies that make sure the law is being followed.

Sometimes, we may agree with the insights of your favorite financial entertainer; in fact, this happens often. However, we are the only ones invested in making sure you grow your wealth prudently. That’s why I urge you to just say no to taking financial entertainers too seriously. They may have marginally good advice on how to retire early, save money or improve credit, but they don’t know you, your business and your financial history – whereas your licensed financial advisor does.

Kraig Strom, CFP®, ChFC® is a Certified Financial Planner® at Team Financial Partners in Corona. He can be reached at 877-297-5851, or at www.PersonalPensionFormulation.com.

Check Also

Serial entrepreneur launches new venture

Serial entrepreneur launches new venture

Eugene Valdez, CEO of The Loan Doctor & Associates, Inc., a full-service contractual CFO company …