Private Wealth
Management Group
Management Group
Is this what you should expect from a "fiduciary" ?
They call it a "fee based" service model. We call it a conflict of interest.
They say conflicts of interest are legal if they "disclose" them. We say most fully-informed consumers would never agree to conflicts like this.
We've been to D.C.. We've spoken with members of Congress. We've protested to SEC commissioners. But we realize that Wall Street's gazillion-dollar budget will always find clever new ways for it to capture a larger share of your wallet.
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Today's "fiduciary" carries a fee-based advisor registration
in one hand and a broker sales license in the other.
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Before you decide to work with any financial company, ask to see their written compensation disclosure and find out all the different ways they get paid.
Objectivity + Independence + Expertise
Insist upon all three!
OBJECTIVITY: If you want financial guidance that is never influenced by a sales agenda, choose an advisor who doesn't also have a sales license.
INDEPENDENCE: If you want investment choices that are never dictated by a company profit agenda, choose a company that doesn't profit from your investment choices.
EXPERTISE: If you want financial expertise, choose an actual financial expert.
DON'T JUST BELIEVE THE MARKETING.
VERIFY BEFORE YOU TRUST:
adviserinfo.sec.gov
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Commentary and a Word of Wisdom from our Founder:
My life changed the day I met "Tuxedo".
It's 1980-something; I'm a rookie financial advisor, on a vacation cruise with my wife, and I'm standing in the ship's casino among a crowd of passengers who appear hypnotized by a large wheel, spinning on the casino wall.
As you might expect, the wheel contains the numbers 1 through 100, and the objective is to correctly pick which number will be at the top of the wheel once it stops.
But what catches my attention is the energetic young attendant in a tuxedo who is handing out little yellow pencils and white note cards that say "Number Tracker" across the top in bright red letters.
Tuxedo then spins the wheel - but only a few gamblers place their bets. The majority of the crowd just stands there gazing at the wheel.
Each time the wheel stops, Tuxedo yells out the winning number, and the spectators bow their heads to scribble something on their Number Tracker cards.
My curiosity grows, and I finally have to ask:
“Excuse me, Sir,” I said to the elderly man standing next to me, “May I ask what everyone’s doing?” He reluctantly revealed his Number Tracker card and said, “We're tracking the numbers."
As I studied his card, I saw that he had marked an "X" across the numbers that won in recent spins. “Number 34 just won," he said, "so I know that I should not bet on it right now.”
“Why not?” I asked.
He raised his eyebrows and glared at me over his glasses. “Odds are against it," he said. "How likely is it that 34 will win again on the very next spin?”
I quickly answered, “One in a hundred.”
He looked to the ceiling for patience and calmed himself with a deep breath.
"Now look," he said - speaking a bit slower so I could keep up. "Statistically, the chances of number 34 coming up twice in a row are pretty slim, so I crossed it off my card. Understand?"
"Actually," I replied, "every time the wheel spins, each number has a one-in-a-hundred chance of winning. It doesn't matter which number won last time."
The man threw his hands in the air and sarcastically barked, “Oh, I see; you’ve got it all figured out and the rest of us are just a bunch of dummies, huh?”
He returned to his task as I stood there with one of those "Are you serious?" looks on my face.
Then it occurred to me:
Who created these “Number Tracker” cards and provided the little yellow pencils?
That’s right - the casino did. They know that humans tend to validate risk through irrational behaviors, so the house promotes it. They capitalize on it.
And they employ people like Tuxedo to distribute the tools for innocent people to do it with.
I looked over at Tuxedo - and I instantly hated him. Or felt sorry for him. Or both. I couldn't tell. He’s either ignorant or he’s complicit - but there’s no third option. And for the life of me, I couldn’t tell which.
So I just stood there, for quite a while, staring at Tuxedo, my brain simultaneously conflicted with both disdain and compassion as he spun the wheel and handed out more “Number Tracker” cards with little yellow pencils.
All of a sudden, I was overcome by a gut-wrenching thought...
"Am I a TUXEDO?"
Was I really a "financial advisor" or was I just handing out "Financial Planning" note cards and little yellow pencils?
I most certainly was not complicit - but was I ignorant? I honestly didn't know. Because I didn't know what I didn't know.
In the months after returning from that cruise, I resigned from the large financial institution that employed me and became an independent advisor - instantly providing me with broader and more competitive financial solutions for my clients.
I completed a 2-year Professional Masters program at George Washington University where I learned the HUGE difference between real financial planning and the corporate sales talk I had been required to peddle.
I subsequently became a Certified Financial Planner® and a NAPFA-Registered Fee-Only financial advisor so clients could trust that my advice and recommendations were never influenced by sales commissions or marketing incentives.
And I created FirsTrust by surrounding myself with other professionals who insist upon doing what's absolutely best for their clients.
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Yes: it's currently legal for an "advisor" to accept sales incentives.
But just because it's legal doesn't make it okay.
And even if it's okay, it still isn't what's best.
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It's your hard earned money.
Please - do your homework. Know the difference.
The FIRST thing to do is find someone you can TRUST!
Michael T. Koenig
FirsTrust founder & CEO
P.S.: A "Word of Wisdom" for Industry Professionals
I know you’re reading this too. Maybe even cursing me under your breath.
So what about you? Are you a Tuxedo?
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Do you honestly believe your company pays
higher commissions, bonuses and incentives
to recommend investments that are in
your client's best interest?
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I've met countless dual-registered advisors who agree completely. They genuinely want to serve their client's best interest. Most tell me their revenue is almost 100% fees anyhow. So my question is, why don't you dump your FINRA sales licenses and become an independent, Fee-Only RIA?
We may disagree on a lot of things - but here's a few facts that are irrefutable:
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The most positive difference in your life will come from
making the most positive difference in the life of your clients.
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I challenge you to actually read all the expensive conflicts of interest that your company discloses in its fine print. And if you’re not OK with it - if you truly want to serve your client's BEST interest but don't know how - please call me.
(386) 788-3737
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800-585-9888