One of the most difficult dilemmas we face is how to choose a professional advisor. Whether it is an attorney, accountant or financial planner, the basic steps are the same. The two main components in our selection process are ethics and competence. Let's analyze the important aspects of each of these items.

Professional competence should ultimately be our supreme concern. Inexpensive advice, if inaccurate, can be significantly more costly over the long haul. Part of competence includes the individual's education and experience. Normally, these can be verified through third party organizations. Depending on the profession, there will be a combination of Federal, State and Local regulatory agencies that can offer various information. The names and phone numbers can be found in the blue pages section of your telephone book. In addition, most professions have self-regulatory organizations (SRO's) or professional associations that police their members.

You may have seen news reports regarding the ease at which individuals can reproduce degrees from prestigious educational institutions. Most consumers just accept the plaque or advisor's claim to have achieved a particular degree or license. It is always advisable to simply call the organization to verify this information. It sounds like common sense, but very few people ever make this small investment of their time.

Ethics is every bit as important as competence. Unfortunately, there are no tests that accurately measure one's ethical nature. Educational degrees and professional designations are no guarantee either. So how do we evaluate this crucial element? Although most articles recommend asking the professional for references, I believe this method is highly over rated. Obviously, the advisor will only offer references that will claim they "walk on water."

A better strategy is to ask friends and family members with whom they work and are satisfied. Get at least three names, then call and meet with each one. Remember that you are interviewing the advisor for a job, so don't be afraid to ask tough questions and demand verification of any claims. The advisor works for you and shouldn't be uncomfortable with or avoid answering critical questions. It is extremely important that you meet face to face with each candidate. Even if they all appear to be competent and ethical, their personality or philosophy may not be to your liking. Therefore, miscommunication and frustration are likely to follow.

Prior to interviewing each person, make a list of items that are most important to you. There is nothing wrong with preferring someone who is active in their community or shares similar philosophies. Unfortunately, some of the least ethical individuals are the best actors. Be wary of slick promises or expensive accommodations. If they promise things that sound too good to be true, get a second opinion. There is absolutely no substitute for instinct.

You should expect the process of selecting an advisor to take time and effort. You will be trusting them with confidential information and expecting them to provide you with advice that is in your best interest. Although there is no foolproof method for selecting an advisor, careful planning and common sense should afford a greater potential for success.

-- Answered by Carmen Petote, certified financial planner at Allegiance Financial Advisors, Inc.