Dollars And Sense

Are you overwhelmed by all the details of your start-up? "New businesses are often underfinanced and don't realize it until it's too late," cautions Hugh Kellogg, a financial advisor in Evanston, Illinois. "A qualified financial advisor can help design a business plan and a realistic budget to avoid surprises." Once your business is underway, a financial advisor can also help you improve cash flow, increase profits--and maybe even enjoy early retirement.

Kellogg, a former Arthur Andersen CPA, says, "It's important to choose someone with a broad range of experience. A CPA might know about taxes and financial statements, but generally isn't familiar with investment securities, business plans, debt management, insurance and retirement planning."

To find a good advisor, get referrals from friends, business associates and professionals (such as your attorney or accountant), or call the International Association for Financial Planning (888-806-PLAN). Fees generally range from $100 to $300 an hour; there usually is no charge for the initial meeting. Before making an appointment, interview several advisors by phone. Ask these questions:

• Do you specialize in small businesses? (Get references.)

• Do you have working relationships with other professionals? (Get names and numbers.)

• How long have you been practicing? Do you have a degree in financial planning?

• What designations do you hold?

Someone designated as a certified financial planner (CFP) or chartered financial consultant (ChFC) usually has expansive knowledge on financial planning. Chartered life underwriters (CLUs) are insurance experts, and most certified public accountants (CPAs) have extensive experience in tax issues.

To verify an advisor's designation:
As a CFP, call the Board of Standards (303-830-7543)
As a ChFC or CLU, call American College (800-368-4684)
As a CPA, call the American Institute of CPAs (212-596-6200).
To determine SEC registry, call (800) 732-0330.