Learn how to be sure you’re making a wise investment

KESQ News Channel 3 and CBS Local 2’s Zak Dahlheimer met with an investment advisor on Friday to help ensure you’re protecting your finances and making wise decisions when considering a future investment.

Carmen Shelton said she recently sought advice about securing money.

“I needed help, I didn’t know how to do it myself,” she said. “I’ve had a little bit of 401k money over the years. But recently, with the sale of a home, I had a little more to invest and wanted to make sure it was protected.”

Shelton said she went to get help from Haddon Libby with Winslow Drake.

Libby, along with Dana Crosby at SC Advisors, said they’re getting the word out about smart investing, and where to look for red flags.

“What we find out here, especially in a place with a lot of retirees, you have a lot of people who want to take advantage of their lack of sophistication, or their desire for a yield or return that’s very big,” Libby said.

Crosby said his firm, like many across the country, practices what’s called the fiduciary standard.

The standard is a mantra, he said, that puts the clients needs above all else.

“Any recommendations that we make, all actions that we do, have to be based on our clients’ needs,” Crosby said. “We cannot engage in any self-dealing whatsoever.”

Meanwhile, Libby recommends doing research, coming up with a smart strategy and aiming for lower costs for better returns.

“Somebody charging you 6/10ths of 1 percent too much over a lifetime, equates to 5 years of retirement,” he said. “So you think about 6/10ths of 1 percent and think well everybody does it. Everybody doesn’t do it.”

Both Crosby and Libby said a couple of resources, in particular, are both FINRA and the Securities and Exchange Commission. Both of their websites, they said, can provide information on companies for anyone looking to invest.

“You should go to these websites to check out their background, any regulatory black marks that someone has on their background, (or) any arbitration,” Crosby said.

Libby said some red flags to look for in the financial services industry include mutual funds charging more than 1 percent, and bad performance that’s not corrected.

He also recommends looking up 12b-1 fees related to mutual funds.

You can find more resources in the earlier version of this story below.

Financial Industry Regulatory Authority Securities and Exchange Commission Google Finance Yahoo Finance