"If it sounds too good to be true, it probably is."
How many times have you heard that expression? Even in favorable economic times, otherwise cautious people can be duped by get-rich-quick schemes or investments that promise unrealistic returns. But when times get hard, folks increasingly fall for these scams in their quest to make ends meet.
Many people, feeling overwhelmed by the complexity of the subject matter, hire a financial planning professional for advice. However, as recent headlines have shown, even highly regarded investment experts sometimes turn out to be con artists simply peddling the latest Ponzi scheme.
So how can you protect and grow your assets and plan for your financial future?
First, educate yourself. There's a wealth of information available online, at libraries, bookstores or your local community college. Get grounded in basic financial concepts such as:
* The importance of saving for short- and long-term goals
* Managing debt
* Creating and living within a budget
* How banking, credit and loan products work
* Why credit scores are so important
* Planning for unexpected events
Helpful resources include:
* MyMoney.gov, the U.S. government's website dedicated to teaching the basics about financial education (www.mymoney.gov)
* JumpStart Coalition for Personal Financial Literacy, a clearinghouse of materials designed for children (www.jumpstartclearinghouse.org).
* AARP, which advises and advocates for people over 50 in all aspects of their personal and financial lives (www.aarp.org)
* Practical Money Skills for Life, Visa Inc.'s free personal financial management site, featuring interactive tools, articles and other resources for adults, children and educators (www.practicalmoneyskills.com).
Don't go it alone. Why not form a book club/discussion group where you can share financial fears, missteps and success stories with mutually supportive friends? It's sometimes easier to digest information and make action plans together. A good place to start is by reading "The Difference: How Anyone Can Prosper in Even the Toughest Times," by best-selling author and "Today Show" finance editor Jean Chatzky.
Finally, don't rule out consulting with a financial planner. Even if you can't afford ongoing money-management services, consider hiring a third party temporarily to help you crystallize your financial goals and trouble-shoot areas where you may be lacking, such as retirement savings, estate planning or having adequate insurance protection.
Many types of professionals call themselves financial planners but they don't all have the same training or specialties. Different groups that certify planners have their own credentialing requirements, regulators and ethical guidelines, but education and experience requirements vary.
If you don't have a trusted referral, good resources to learn more about different kinds of planners include the Financial Planning Association (www.fpanet.org), the National Association of Personal Financial Advisors (www.napfa.org), and the Certified Financial Planner Board of Standards (www.cfp.net).
If necessary, interview several candidates until you find someone you trust, who asks pertinent questions about your situation, and who won't try to sell you unneeded products or services. Ask for references, and make sure he or she is registered with the North American Securities Administrators Association (www.nasaa.org).
Just as we consult doctors about our health, sometimes having a professional do a financial check-up can pay off as well.