The Washington PostDemocracy Dies in Darkness

How to prepare financially in case of a debt ceiling crash

Here are eight tips for finding the right financial planner to help you navigate rough economic times

Traders on the floor of the New York Stock Exchange on Thursday. (Michael M. Santiago/Getty Images)
5 min

Just when it looked like the stock market was on the road to recovering from 2022, another looming crisis has rattled investors.

The White House and House Republicans are locked in a showdown over the nation’s debt ceiling, the legal limit on how much the federal government can borrow to pay its bills.

On Thursday, the Biden administration began using extraordinary measures” to keep the government from breaching its $31.4 trillion debt limit, a scenario that could lead to default and unleash fiscal calamity. Republicans are using the precarious situation to leverage deep spending cuts and may even try to slash entitlement programs such as Social Security and Medicare.

What is the debt ceiling, and what happens if the U.S. hits it?

This is not great timing for the debt ceiling drama, considering inflation is still too high and the Federal Reserve’s measures to fight it could push the economy into a recession.

This all spins back to the stock market, which may be cause for concern as you try to invest for retirement or build enough savings to sustain you during tough times.

Stocks sank this week amid layoff announcements — Microsoft is cutting 10,000 jobs and Google parent Alphabet is slashing 12,000 — and signs the economy might be slowing.

After raising the debt limit for decades, Republicans in recent years have leveraged it to enact spending cuts while also threatening government default. (Video: JM Rieger/The Washington Post)

“The key to successful investing is to know how much risk you can afford to take and make a commitment to keep the assets that you don’t need for a long time invested in the stock market through thick and thin,” said Carolyn McClanahan, a certified financial planner who founded the fee-only Life Planning Partners, based in Jacksonville, Fla.

At times like these it makes sense to seek professional advice about your investment strategy — if you have one. Here are tips that can help in your search for a financial planner:

Ask friends and family. Get recommendations from people you know who are working with a planner. But don’t bypass your own fact-checking. A planner who works well with a friend or a relative still might not be right for you.

Look to financial planning organizations for referrals. The National Association of Personal Financial Advisors ( can put you in touch with a fee-only planner. The Financial Planning Association is the membership organization for certified financial planner (CFP) professionals. Search for a CFP online at You could also check the National Association of Insurance and Financial Advisors (

Search planner networks. Try the Garrett Planning Network ( or XY Planning Network (, fee-only financial advisers focused on working with Gen X (generally people born from 1965 through 1980) and Gen Y or millennials (anyone born between 1981 and 1996.)

Check credentials. Planners with certain designations must meet specific educational and employment requirements and agree to abide by a code of ethics. You probably have seen planners with the CFP designation. Other credentials to look for: chartered financial consultant (ChFC) or certified public accountant (CPA) with a specialty designation as a personal financial specialist (PFS).

Expert forecasts 2023 as a year of ‘economic pain’

The Financial Industry Regulatory Authority (Finra) has an online list that explains the alphabet soup that financial professionals use. Learn what they mean at

Check for disciplinary issues. Before you dine at a new restaurant, you might go online to look at reviews, right? Looking for a new refrigerator? You probably checked how Consumer Reports rates the models you’re interested in purchasing. (If you didn’t, you should.)

So why wouldn’t you investigate the person you are considering for financial advice?

Go to and search for a firm or an individual investment adviser’s registration status and background, including any disciplinary actions.

Also, search Finra’s BrokerCheck database (, which will confirm whether an individual or firm is registered, as required by law, to sell securities (stocks, bonds, mutual funds) or offer investment advice.

Don’t forget to check with your state securities regulator to research brokers and investment advisers. The North American Securities Administrators Association can help locate your state regulator (

Understand the fee structure. Don’t be shy about asking how the planner will be compensated. They could be a fee-only planner, be commission-based or charge a fee based on assets under management.

Ask whether the adviser is a “fiduciary.” By law, an investment adviser who has a “fiduciary duty” must act in the best interest of clients. But investment professionals who are not fiduciaries don’t have to adhere to this standard. Instead, the law says they only need to ensure their advice is “suitable” for the client.

This distinction is important, because certain incentives may result in advisers recommending investments that make them more money but are not in your best interest.

Ask a lot of questions. This is your money, your life. The best planner my husband and I hired listened to our concerns. Most importantly, she pushed us out of an investment comfort zone that was too conservative. She never got offended when I challenged her recommendations.

For many of you, as it was for me, putting your faith and financial business in the hands of a professional can be scary. In many respects, you won’t know how good the advice is until you implement a recommended plan. That’s why it’s important to do your homework. Don’t settle for the first planner you meet. Interview a few before making your choice. Come to the interview equipped with a long list of questions.

A good financial planner should listen to your goals, assess your financial situation, and then come up with a plan tailored to your needs and objectives. Find an adviser who does that, and you will get your money’s worth.

B.O.M. — The best of Michelle Singletary on personal finance

If you have a personal finance question for Washington Post columnist Michelle Singletary, please call 1-855-ASK-POST (1-855-275-7678).

Recession-proof your life: The tsunami of economic news in 2022 is leading consumers, investors and would-be homeowners alike to ask whether a recession is inevitable. Whether a recession comes, there are practical steps you can take to help shield yourself from a worst-case scenario.

Credit card debt: It is the worst debt to carry in good times. Here are seven ways to lower your credit card debt in light of the Fed’s signaling additional rate increases in 2023.

Test Yourself: Do you know where you stand financially? Take our quiz and read advice from Michelle.

Money moves: With the stock market losing 21 percent in the first half of 2022, and inflation a worry to consumers, people are desperately seeking a place to park their extra cash. If you have money sitting around earning a little more than 1 percent, if that much, I bonds are an attractive deal.