Just like planning for retirement, choosing a financial adviser can be much more challenging than it sounds—especially for senior needs. Today, we’re releasing “Know your financial adviser,” a guide to help you ask the right questions if you’re shopping for an adviser with a title suggesting expertise in senior financial planning. Titles like “veteran’s adviser,” “retirement adviser,” “senior specialist,” “benefits coordinator” or even “financial planner” don’t always mean the professionals are qualified to help you manage your money. Some titles require in-depth training, while others are easily picked up over a weekend.
For some military retirees, the decision is complicated even further by the need to find an adviser who understands the complexity of their retiree pay, veteran’s benefits, or disability benefits. This adviser should also understand the full financial impact of other benefits like TRICARE, commissary privileges, survivor benefit plans, and veteran’s service organization membership benefits.
Here are four things to think about when evaluating a financial adviser’s title or credentials:
How much training is required? Senior financial planning is a complex field which includes topics like estate planning, income tax laws, and investments. Some titles therefore require college-level coursework and passing tough exams, which can take many months or even years to complete.
Is your adviser qualified through a training program that holds its members to strict ethical standards? You should be able to file a complaint easily with the organization that issued your adviser’s financial title, as they may discipline or ban members who don’t follow the rules.
Is your adviser’s financial title accredited? Accredited programs have taken important steps to ensure the quality of their training.
Does the adviser have an extensive background working with a specialized group like military retirees? Just because someone calls themselves a veteran’s adviser doesn’t mean they know anything about military retiree pay systems, veteran benefits, or even the military, for that matter.
In addition to learning how to find a qualified financial adviser, you can also protect yourself by learning how to spot signs of potential financial fraud by phony advisers looking to exploit you. You can download a copy of our previously released Money Smart for Older Adults – Prevent Financial Exploitation guide to help you spot the warning signs.
Most financial advisers have worked hard to earn the knowledge and skills required to help you. But credentials and promises alone don’t guarantee expertise or the quality of someone’s training. It’s up to you to look closely at the training, background, and quality of service when picking someone who promises to help you protect and grow your well-earned nest egg.
Payday loans are typically marketed as a way to get quick cash when you need it. They are generally for small amounts due quickly, like on your next payday, and they often give the lender a claim on your bank account. They are sometimes also called cash advance loans.
We’ve heard from people who like the ease of obtaining a payday loan when they need to avoid paying their bills late. Many other people have raised concerns about the high cost of payday loans, not being able to repay the payday loan while still having enough money left for other expenses, and the debt collection practices they encounter if they can’t repay the loan.
Starting today you can submit a complaint if you have a problem with your payday loan. You can submit a complaint about:
Unexpected fees or interest
Unauthorized or incorrect charges to your bank account
Payments not being credited to your loan
Problems contacting the lender
Receiving a loan you did not apply for
Not receiving money after you applied for a loan
You can also get clear, unbiased answers to questions about payday loans on Ask CFPB or by calling (855) 411-2372.
Your complaints help us identify business practices that may pose risks to consumers and we use that information in our work to supervise companies, enforce federal consumer finance laws, and write better rules and regulations.
Starting today, you can submit payday complaints to us. So this seems a good time to remind you that if you are a servicemember on active duty you, your spouse, and certain dependents have the protection of a special law called the Military Lending Act (MLA). The MLA says that you can’t be charged an annual percentage rate higher than 36 percent on certain types of consumer loans, and that includes certain payday loans as well as auto title loans and tax-refund anticipation loans.
So what exactly is a payday loan? It tends to be a short-term, usually high-cost, cash advance where you pay a fee to borrow money (for example, a $15 fee for every $100 borrowed) and you are expected to pay it back in a short time, usually a couple of weeks. People often tell us that the MLA cap of 36 percent seems like a pretty high limit – but what they don’t realize is that the average annual percentage rate on a payday loan like the one above is 390 percent! And if you roll over the loan repeatedly because you can’t pay it off like you hoped you could, then the cost can skyrocket over time. We’ve seen examples of payday loan borrowers who end up paying far more in fees than the amount they originally borrowed. In some cases they could have gone to one of the military relief societies, if it was an emergency, and gotten a loan at zero percent interest. Yes, zero – no fee at all.
So, the good news is that the MLA provides you protections that the average citizen doesn’t have when it comes to payday loans. And the CFPB is one of several federal agencies that have the power to enforce the MLA. But your complaints are key to helping us enforce it and other consumer financial laws.
You can submit a payday complaint online or by calling (855) 411-2372. Don’t forget to tell us you’re “military” when asked!
Complaints help us spot trends. Submitting a complaint helps us see patterns, focus our resources, and identify the worst actors – so your complaint can make a difference!