(originally posted here∞)

AEFA (American Express Financial Advisors) have been the subject of major two class-action lawsuits in the last few years owing to the poor ethics behind their "advice." Their reputation tarnished the parent company's image so much that the Amex changed the name to Ameriprise.

Invitations, marketing cross-promotions with Costco, individual counseling sessions...where do you think the money to offer all this free stuff comes from?

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In terms of personal experience, the Amex advisor I met with wasn't bad. He was in his late 50s and had been certified for at least a decade. Probably as a result (of longterm experience, not his Amex affiliation), he did a very good job stressing diversification and disciplined rebalancing. He even produced a copy of the famous Callan chart∞ (the copyright seal was rebranded to Amex, hmm). Then again, he also tried to sell me whole life, and naturally the core funds of my portfolio would've been loaded. Fuck that.

I haven't met with a USAA advisor in person, since their fee-based services were more expensive than quotes I got from local NAPFA-certified planners. I have called them a couple times, though, posing as both myself and my dad (he has the same name) to see what kind of advice they give to people in various situations. It isn't bad -- if you've never talked to a planner before, you may as well call USAA's 800 number now, considering it's a free membership benefit. The guys I talked to had the basics of asset allocation and tax management down, but they didn't seem as knowledgeable as even the Amex guy. Obviously they suggest USAA's funds, which aren't terribly cheap (1.0-1.2% ER on average) and have a history of excessive management turnover, but at least they're not loaded. They did not try to sell me additional insurance, which was a surprisingly nice touch considering insurance is a core profit center for USAA in general (more so than Amex). Still, there's no substitute for knowing your shit before you pick up the phone.

What planning needs do you really have? Is this more about self-education or more about finding someone to do lots of work-for-hire? If you want to learn, go to your favorite library and pick a book from the diehards.org recommended reading∞ list. If you want a local advisor, you start at http://napfa.org∞ -- though depending on your net worth and exact needs, you may want to consider asset management services instead. I could recommend a few, or being a well-travelled forumgoer yourself, you could troll the diehards message board (several well-known advisors post there) and decide for yourself.

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Agreed. Even on this forum there are lots of advice threads about consumer debt. Those aren't the sorts of things that financial planners typically deal with, except to say "pay it off." It's even less likely that a CFP would be helpful WRT school. Knowing how to work the system when it comes to government loans/university fellowships/etc. is a whole other ballpark.

And like I mentioned, USAA's financial advice 800 number is free. You just won't get a written product.

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