Finding someone to turn to for financial advice should be as easy as finding a doctor.
But it turns out the credentials which financial professionals use to represent themselves are often not clear.
And getting the wrong guidance can be costly. Misguided advice costs investors about $17 billion in wealth annually, according to a 2015 report from the Obama-era White House.
For an individual investor, that lost wealth can mean the difference between retiring on time and having to continue to work to make ends meet.
"I hate to think how many people are still working in their 60s and 70s, not because they want to, but because they have to," said Patrick Lach, assistant professor of finance at Indiana University Southeast.
"How many of those people are still working because they had received poor financial advice?" he said.
Now, new research both from Lach and from other researchers highlights some key areas where consumers seeking advice are led astray.
Keeping these red flags on your radar could help protect your money — and help prevent you from suffering life-changing financial losses.
When Lach set out to conduct new research, it was based on a hunch that some of the credentials following financial advisors' names is meaningless.
He assigned a graduate student to come up with a list of fake, but accurate-sounding credentials.
And he was surprised at the results.
"I was fooled by him," Lach said. "I literally thought my student forgot to follow my instructions and and forgot to Google the titles."
If he himself, despite many years of experience in the financial industry, can be misled by the certification titles, he said, the same is possible for policemen, nurses and other career professionals.
One of the key sources of confusion is the label "financial advisor." That's because many in the profession use it as a catch-all label.
Moreover, there are now about 200 credentials that an advisor can use, Lach said.
To whittle down the confusion, individuals should focus on a couple of key qualifications, he said.
That includes the certified financial planner, or CFP, designation for financial planning, as well as the certified financial analyst, or CFA, for investment management.
Forthcoming research from Jeff Camarda, chairman and CEO at Camarda Wealth Advisory Group, and a team of researchers, takes a look at the relationship between professional designations and misconduct.
The research looks at financial advisors based in Florida who are regulated by the Financial Industry Regulatory Authority.
The results show that professional misconduct is more likely when professionals are: male, dually registered with both fiduciary and non-fiduciary sales licenses, or licensed to sell life insurance products.
SEC-registered investment advisors, who are required to act as fiduciaries, must put their clients' interests first.
But other professionals, such as brokers, have traditionally been subject to what is called a suitability standard, which means products sold to the individual must only be appropriate for the individual. (Broker-dealers are in the process of adjusting to a new best interest standard from the Securities and Exchange Commission.)
"If you have both licenses, you have both halves," Camarda said. "Am I telling you what's in your best interest as a fiduciary, or am I trying to sell you a high-commission product?"
The research also found that among the three designations FINRA follows — CFP, CFA and chartered financial consultant, or ChFC — the CFP was more often associated with misconduct violations.
Of note, the provider of that designation, the CFP Board, is in the process of updating its enforcement program.
Ultimately, it is the individual's responsibility to know whom they're working with and what they're buying.
"With everybody using the term 'advisor,' that could be the clerk at the bank, up to somebody like me with a Ph.D. or a tax attorney," Camarda said. "Everybody calls themselves an advisor these days."
Individuals can start by going to BrokerCheck and researching their financial professional's record, including any history of misconduct, such as convictions, license suspensions, or settlements with clients.
They should also verify that the professional's designations are accurate and current. The CFP Board offers a search tool to help find its registered professionals.
While the organization is in the process of updating its records to better reflect BrokerCheck and the SEC's investment advisor database, consumers would be wise to use those resources, as well.