(MONEY Magazine) – We wouldn't even try to estimate how many times we've been asked on our national radio show, "How can I find a financial planner I can trust?" There is no easy answer, and as documented in MONEY's November 1992 article "The Broken Promise of Financial Planning," plenty of people who call themselves planners do work that ranges from incompetent to fraudulent. The free publication Consumer Guide to Comprehensive Financial Planning, from the International Association for Financial Planning (800-945-4237), is a good way to begin, however. Then, after reading it, follow our three-step process to weed out the phonies and find the right planner for you. Step one: Identify several reputable planners in your area. The best sources of references are friends and business associates whose incomes and financial goals are similar to yours. If you don't know anyone who has a planner, call the 7,700-member Institute of Certified Financial Planners (800-282-7526) for the names and phone numbers of C.F.P.s in your area. While not every first- rate planner has the C.F.P. designation, we believe the effort necessary to get those initials is an indication of a planner's commitment to the profession. To become a C.F.P., a planner must pass a rigorous six-part course offered by any college registered with the International Board of Standards and Practices for Certified Financial Planners and must have worked in the field for at least three years. Once you have the names of three local planners, telephone them to set up initial meetings, which should be free. Step two: Subject your prospective planner to a tough interview. Use this session to learn how the planner gets compensated and whether he or she has any potential conflicts of interest, to assess the adviser's expertise and to see if the two of you hit it off. From a compensation standpoint, there are three types of planners: fee-only, whom you pay about $80 to $125 an hour plus an annual fee of 1% to 2% of your portfolio; fee and commission or fee-based, who get similar fees plus commissions on investments and insurance policies they sell -- typically equal to 3% to 5% of your portfolio annually; and commission only, who get paid only when you buy investments or insurance from them -- again, about 3% to 5% a year. We don't think one method of compensation is better than another, but if the planner accepts commissions, ask which investments he tends to sell. If you hear a one-product pitch, you are dealing with someone more interested in selling than planning. Find out about the planner's experience and his clients. Don't hire anyone who has been a planner for less than three years; let novices practice on other people. Ask the planner to describe the income levels, portfolio sizes and jobs of his typical clients. You want to work with a planner who tends to deal with people whose finances are like yours, since he will know how to deal with issues you face. Get one of the adviser's actual plans, with the name of his client deleted for privacy. Read it when you get home to be certain that you find it easy to understand and that its recommendations are specific.

Step three: Check to be sure the planner has a clean record with regulators. Call your state securities department and the federal Securities and Exchange Commission in Washington, D.C. (202-272-7450) to see if the planner has been the subject of disciplinary actions by either of these agencies. If the adviser's firm belongs to the National Association of Securities Dealers, phone the NASD to see if there have been any judgments against the planner, if complaints against him have resulted in arbitration awards to the complainant, or if there are any pending disciplinary proceedings (800-289-9999). If he checks out okay, sign him up.