When Investing Gets Too Emotional, Hire a Planner

As I discussed on Monday, building a sound plan and following through regularly will help to take the emotion out of your investment decisions most of the time. But sometimes personal events, such as divorce or illness, can be so overwhelming that you want to take out all your money and stick it in a bank savings account, where you don't have to monitor it.

Or it could be that you've made such a mess of your portfolio that you can't even look at it without wincing. You put off straightening things out even though you know the longer you wait the worse it will get.

That's when you should seek help from a financial planner. A good, experienced planner has probably helped scores of people who went through a similarly trying time. A planner can make special recommendations and walk you through all your investments so that you'll be confident things are all right. In addition, you'll know that the planner is watching over your portfolio during the times that you don't have the energy or time to do so.

In fact, Sue Stevens, Morningstar's director of financial planning, just wrote a good piece detailing what surviving spouses should do to get their finances in order after the death of a loved one. If you're ready for a financial planner, check out Sue's advice on finding a good one. Sue recommends you look for an experienced certified financial planner. Ask the planner how he or she gets paid and how he or she goes about selecting good investments.

In addition, you should ask your friends to see if they would recommend a planner who they've been with for years. Remember, just about all advisors sound okay when you first talk with them. It's over a period of many years that you find out how much service they provide and how good their advice is. You can also find good planners by going to the National Association of Personal Financial Advisors' site.

The Fund Industry Responds to Spitzer
Most fund companies have weighed in with their comments on New York Attorney General Elliot Spitzer's investigation of late-trading and market-timing. T. Rowe Price, which hasn't been named, had one of the stronger statements. It's encouraging that the firm says it didn't allow the practice and would like to see greater oversight of hedge funds to better protect fund investors. Among the four shops caught up in the scandal, Bank One gets points for saying it'll discipline anyone who knowingly violated the spirit of Bank One's policies. I hope "discipline" means "fire." Strong's response was quite bland. Bank of America's statement had a little more detail, but it didn't say much other than the firm is reviewing its processes and will make restitution to injured parties. Janus said something similar, though its original letter prompted Slate to rip Janus for "the world's lamest spin job."

Meanwhile, Vanguard  has also weighed in.