What the DOL’s Fiduciary Rule Means Now and What You Can Do About It

You have heard much about the results of the new definition of fiduciary released by the Department of Labor (“DOL”). Few pieces of regulation have been as long-awaited, as hotly contested, or as little understood.

Even the timing of the rule’s provisions requires a scoresheet. After years of planning, proposed rules and withdrawn rules, the DOL released the “final” rule to be effective June 7, 2016, but its provisions were not to be applicable until April 10, 2017. Following the start of the Trump Administration, the applicability date of the new definition was extended to June 9, 2017, with many of the more controversial provisions likely not becoming “applicable” until July 1, 2019. We all wait on the edge of our seats to learn what new form the rule may take when it emerges from the delay.

Highlights of what the new rule means.

In issuing this ground-breaking regulation and later pronouncements, the DOL:

1. Expanded the definition of fiduciary.

Despite some common misconceptions, nothing has changed from the new rule’s definition of fiduciary. Anyone who is paid to provide investment advice is a fiduciary and must act in the best interest of the customer. This is true whenever the advice is provided to a plan, an IRA, HSA or similar IRA-like accounts.

In general, this means that the fiduciary must hold the customer’s interest above his or her own, avoiding all conflicts of interest and receiving only reasonable compensation. A fiduciary must act prudently, essentially meaning that the fiduciary must exercise appropriate due diligence and follow a reasonable process in making decisions. Just as before, a reasonable process does not require perfection in decision-making; it does require collecting facts, identifying options, giving sound consideration to available choices and maintaining a good record of the process.

2. Clarified that commissions and payments from third parties create prohibited conflicts of interest. Only “level” compensation is conflict free.

Commissions have been long-entrenched as traditional forms of compensation for brokerage sales. Commissions are transaction-based, meaning that a commission is paid every time a trade is made and there is no compensation if a trade is not made. Commissions can vary, based upon the type of security that a customer purchases. Bonds may pay different commissions than stocks and one mutual fund may pay more than what another equally appropriate mutual fund might pay. This means that a broker-dealer registered representative could recommend a particular investment that pays him or herself more than what another equally appropriate investment might pay. The DOL believes that this creates an inherent conflict of interest. Since the transactions are conflicted, they are prohibited and subject to substantial penalties. This long-established rule created extensive consternation among the broker dealer community.

Registered investment advisers and their investment advisor representatives are traditionally paid asset-based fees or fixed dollar amounts. These fees are owed regardless of the number of transactions that the advisor recommends be made and regardless of which investments are recommended. Since compensation to the advisor does not vary with the investment recommendation, it is known as “level” compensation.

3. Created new exemptions to permit conflicted compensation, subject to specified conditions.

In response to thousands of complaints requesting relief for traditional forms of brokerage compensation, the DOL conceded in a very clever way. It spoke to the industry, saying that it could continue to pay conflicted forms of compensation, so long as the fiduciary rendering advice meets specified conditions and enters into a Best Interest Contract. This contract is the dreaded BIC. The fiduciary advisor must make lengthy disclosures, commit to acting in the client’s best interest, and maintain policies and procedures to ensure that the advice remains conflict-free. This representation is enforceable in state court. Short forms of the exemption were created for ERISA plans and for the “Level Fee Fiduciary.”

4. Postponed enforcement while the rule is reconsidered; Impartial Conduct Standard survives.

The BIC portion of the rule has been delayed, likely until 2019, or it may be substantially revised or even dropped. Until then, broad transitional relief is available. No BIC contract, written policies and procedures or private right to sue is mandated. The only requirement to avail oneself of the transition exemption is to satisfy the Impartial Conduct Standard. It requires that an advisor:

  • Act in the best interest of the client
  • Receive no more than reasonable compensation, and
  • Make no misrepresentations about services and fees.

On its face, this looks simple. Remember: no formal written policies, procedures or contracts are required. Closer evaluation reveals some gaps, however. How do you know you are acting in the best interest of a client if you have no policies or procedures to guide you? Have you properly disclosed any potential conflicts of interest? Can you tell what is reasonable compensation for services without benchmarking other fees? Might a client misunderstand, or worse, believe that you may have misrepresented about what services you will perform, if you do not describe those services in a well- written, easy to read, agreement?

While not required, having clear policies and procedures, benchmarking your fees and maintaining clearly understandable contracts simply makes sense. Each is a best practice that is likely to increase understanding among parties and to produce happy results. This is nothing new.

What financial advisors, broker dealers and RIAs should do now.

What firms and advisors can do now is simply update sound, time-proven practices:

  • Follow a prudent process to meet the requirements of the transitional relief. Review your policies and procedures and update them as required. Define who is a fiduciary and chart a path for how to act in the client’s best interest.
  • Update your agreements. Acknowledge your status as an ERISA fiduciary when delivering advice to a plan, IRA or IRA-like account. Make sure they are written in plain, English.
  • Review errors and omissions insurance coverage to confirm that fiduciary activity is covered. Many policies exclude this coverage so speak with your agent to confirm whether a special endorsement is required. Review how service to IRAs will be treated.
  • Understand all forms of compensation the advisor, the firm and its affiliates receive. Evaluate any form of unlevel compensation such as commissions and third party compensation such as conference support and revenue sharing. Consider what value those payments bring to you, compared to the potential conflicts and disclosures they might require. Review your business plans in light of those findings.
  • Record your reasons to recommend any rollover or a conversion from a brokerage account to an advisory account. Draft detailed, check- the- box forms to detail what reasons best meet your client’s needs.

Wouldn’t it have been a best practice to have done these things all along?

About the author:

Kim Shaw Elliott is President and ERISA Counsel of IFP Plan Advisors, a division of Independent Financial Partners, an SEC registered investment advisor serving 1700 retirement plans with over $35 billion in assets under advisement. Kim helps investment advisor representatives successfully navigate the complex rules founded in ERISA, securities law, broker dealer regulation, and tax. She is a three-time graduate of Washington University in St. Louis, which awarded her a JD, LLM- Taxation and MBA.

Retaining Clients Through a Transition

If you have been in the industry long enough, you’ve heard horror stories about advisors changing firms or breaking away, only to lose a majority of their clients. This story is the same across numerous channels, including wirehouse, independent, and insurance-based or bank broker-dealer-affiliated advisors. These stories are sometimes fabricated by branch managers to scare everyone straight (I am thinking of my former wirehouse!) and sometimes they are true.

Exploring the Truths

Let’s start by exploring the cases that are true. It’s typically obvious why this happens. An advisor is not happy with their practice’s growth and often is pressured by their firm to produce more. They may react by moving to a new firm that has a polished recruiting strategy that seems far more attractive. However, the advisor has never been proactive and plateaued early on in their career.

They got here by not building or adopting a system to more efficiently manage their clients and practice. Clients were never segmented and called or asked to meet on a monthly, quarterly, or annual basis. These clients typically were the ones initiating the conversation, which often put the advisor on their back foot. Without an established relationship, the inevitable death spiral will occur when switching firms.

Why does this happen?

Clients choose to work with the advisor, not with the firm that he or she is affiliated with. Wirehouse advisors: you know it’s true. Every individual is compelled to look out for number one and, should they receive poor service, they will make a change. So, when advisors make the change for a ‘new beginning’ or ‘upgraded platform’, clients exit stage left.

A Cautionary Tale

When consulting with advisors during a transition we always ask, “What does your client service model look like?” We tell them that they don’t need to answer the question to anyone but themselves, but the answer will affect client retention. There are other factors that impact client retention during a transition, but there is no other single factor that has a more profound negative or positive effect than how an advisor services their clients. Period.

We recently counseled an advisor who was moving and one week prior to the transition date, he asked me if it would be okay for him to speak with his compliance officer. According to the advisor, this individual was trusted and held in very high regard. He thought the compliance officer could make his outgoing departure smooth. For the record, we strongly advised him not to share this information and in the end against his better judgment, he told his secret. Luckily for him, this particular incident only resulted in one lost pay period of fees and commissions, but it’s still not an easy pill to swallow. However, it could have been much worse. Outside of your spouse/partner and attorney (and new firm!) never tell anyone about your move, as it could result in immediate termination.

Retention Rates Remain High

The majority of advisors do subscribe to tremendously effective service models and we often see client or asset retention as high as 85% or higher. This retention begins years before an advisor is even thinking of changing firms, as the advisor’s business practices help cater to clients for life. They become a trusted financial consultant and occasional poor investment performance results don’t cast a shadow on the relationship. Having taken my own book of business through a firm change, and then helping dozens of advisors and teams make a move, we consistently see client retention between 70% and 90% or higher. More often than not, the lower retention rate is by design as they shed clients they don’t want.

A Tale of Success

One of my favorite stories, told so much more eloquently than I can, comes from an advisor in Ohio. He left a wirehouse to affiliate with an independent broker/dealer. Let’s call him John. So, John segmented his book A through D, as so many advisors do. Upon resigning, his ‘A’ clients received nothing short of white glove service to ensure retention. The ‘B’ group received very close to the same level of attention, as they were also very important to his business. John mailed one letter to his ‘C’ clients and if they did not respond to the letter, he let them go. His ‘D’ clients (the ones he definitely didn’t want) were never notified of his move! The day after he moved firms, John said he was more profitable than ever and, more importantly, he was now running a highly efficient practice.

Final Thoughts

At the end of the day, Advisors should focus on a better experience for their clients and the retention will follow. As long as you are maintaining a close relationship with them, clients will be loyal to you, rather than the firm you are affiliated with. Whether you stay with your current firm or not, client happiness is the core metric that dictates an advisor’s success or failure. Never forget that.

Ned Van Riper, a 18-year industry veteran, is Director of Recruiting with Independent Financial Partners.

Internal communication for advisory use only. Not for distribution to the general public.

Professionals at Cafe

Building Genuine Relationships for Potential Business Growth

In my line of work at IFP, I often have to build relationships with some unfamiliar faces. This means I’m constantly breaking out of my comfort zone, having some off-topic discussions, and turning those conversations into fruitful business arrangements. There’s no secret sauce or some mystical influence I have over other individuals – it’s just me and my decades of experience as a financial professional.

Whether you can offer the other person a new concept, strategy, or the keys to help unlock their hopes and dreams, a genuine relationship is the spark that ignites that fire.

Humanizing the Professional

If you initially communicate through email with an individual, don’t take their initial rigid speech to heart. Most people sound a bit mechanical when they type, which is simply a product of people meticulously picking apart their own writing before sending off a professional communication. We all do it – don’t overthink their overthinking.

Remember, you’re just trying to get a face-to-face conversation rolling as quickly as possible.

When you finally get that in-person opportunity, treat the person sitting behind the desk as a human being. They have their own dreams, aspirations, and business goals. Before throwing them some hard sell technique you learned in business school, slow down, gauge their personality, and get a feel for their beliefs. This helps later when you need to find common ground that will act as a catalyst to kick start your relationship.

Be Personable

Just as you can acknowledge them as a living, breathing person, you need to be one as well. While you should respect their position as a professional, a close relationship can only make your life easier. This closeness will allow you to openly communicate with them as issues or opportunities arise, potentially enabling you to more easily reach a reasonable and productive conclusion.

Sharing Common Goals

Without a common business goal, there’s no point to a professional relationship. Now, before you call up that contact you didn’t click with and burn the bridge, know that each connection established is a possible opportunity. Even if it doesn’t work out with that person, someone in their network might be looking for a financial advisor. Add that old connection on LinkedIn, ask them how their kids are doing from time to time and stay engaged.

As long as you find professionals that share your values and/or business goals, it’s worth staying connected.

Schedule Some Time

Should you start working together, it’s important to spend time with them on a regular basis. Whether they accept your offers or not, the gesture does not go unnoticed.

Be Helpful…But Not Too Helpful

If you’re like me, I naturally enjoy helping people. While this can help build a stronger bond with stakeholders in your new environment, people can take advantage of your good will. Financial advising is also about getting paid for your advice, so next time they want you to look over their entire financial situation, you might consider telling them to make an appointment.

Dealing with Difficult People

I know I’ve focused mostly on the scenario in which you’re universally accepted into the new workplace with open arms so far, so let’s look into the opposite scenario. Sometimes professionals don’t want friends. Sometimes it’s only about the money and passion for their job is a distant second.

In these scenario, it’s still possible to build a genuine relationship, but it’s one based purely on gaining a competitive advantage or generating more revenue. Our ultimate goal is to generate more business, so it’s nothing to be upset about. In fact, certain personalities might find this sort of arrangement far more appealing and no one can fault you for that.

Closing Thoughts

Every business relationship requires attention in one way or another, but as we adapt to changes in the financial services industry, it’s more important than ever to network. While it might be uncomfortable at first, being charismatic can help you achieve greater success than you have ever known. Also, as my old boss used to say, “The worst they can say is no.”

Blog Series: The Truth About Branding for Financial Advisors (Part 2 of 3)

In this series about branding for financial advisors, we explore some blunders, steps to improve an advisor’s brand presence, and – for the uninitiated – where to get started.

If you missed it, check out Part 1 of the series where we discussed investing in your brand and asking the right questions.

This time we’re going to dive a bit deeper into what it means to be an independent financial advisor and building a brand around that experience. As we always say in the IFP Design Group, your brand is not your logo. Let’s continue our journey into branding with the next branding truths for financial advisors.

Truth 3: You must have a marketing plan (in addition to) a business plan before launching your independent advisory practice.

Whether they’re concrete or abstract, every successful company starts with a goal-focused roadmap and a plan of action for achieving those goals. It’s easy to buy a book of business to kick start a business. In addition, some organic growth may occur through referrals and word-of-mouth, but what about the growth that could possibly be achieved through a developed marketing plan? Well, let’s start by answering a few questions.

Why is this important?

For some, it might seem pretty obvious that a marketing plan is important. Unfortunately, in our experience of working with advisors, it’s not all that common in this industry, especially during the whirlwind of establishing a practice. The same can be said for advisors or advisor firms that have been in business for many years. We get it – after spending the majority of your day grinding away earning new business and dealing with existing clients, the last thing you want to do is exert more effort creating a solid marketing plan. However, there will come a day when you will want to generate new business through marketing initiatives, which is why it’s so important to start as soon as possible.

I didn’t have a plan before. Why do I need one now?

We get it. You haven’t needed a plan before and you aren’t starving to death. With that said, there’s a big difference between surviving and flourishing. Just like the other divisions at IFP, we are constantly encouraging advisors to reach beyond their comfort zone to build a legacy of prosperity and greater success.

Another common preconceived notion is along the lines of business growth and generating new leads (prospective clients). Our team frequently speaks with advisors seeking to freshen up their client list as their careers have picked up and the most common feedback we get goes a little something like this: “I acquire most clients by word-of-mouth or through referrals. Why should I look elsewhere?” While it’s certainly a good way to generate new business, what happens if that well dries up? Are you diversified enough to withstand the loss of a referral network? Especially for small advisory firms, it’s incredibly dangerous to rely on such a piecemeal strategy to sustainably grow your company.

What tools do I need?

This is the part where you expect us to say you need to spend at least $50,000 to $100,000 a year on marketing and advertising to get anywhere. That couldn’t be further from the truth. As you may have discovered on your own, the Internet is a great place to find business growth, but advisors often have trouble navigating this unchartered territory. Our internal team has identified a number of completely FREE tools that can help grow your business online with minimal effort.

Google Analytics

Do you have a website? Are you tracking the visitors that come to your website? If not, we have a good place to start. Google Analytics allows you to keep track of users’ activity while on your website. This data can be used to optimize your customer retention rate, improve conversion rates, and create content that’s more relevant to your target audience. There are many other applications for this information, but we recommend you start simple and work your way up from there.

Get Started with Google Analytics >>

Google My Business

If you have a website, you’re on Google. How a website displays on Google is an entirely different matter. By claiming your Google My Business account, you gain significant control of your web appearance. Verify the firm’s business address, phone number, name, hours of operation, and photography with ease.

Get Started with Google My Business >>

Bing Places for Business

Bing Places for Business is Microsoft’s answer to Google My Business. For them, it’s competition; for you, it’s opportunity. Claim your Bing listing and get to work molding your company’s online presence.

Get Started with Bing Places for Business >>

Business Citations

Remember the days when a fat phone book landed on your front door stuffed full of advertisements with little numbers inside? Then, in the very back, you’d find the coveted yellow pages where services were listed out for your convenience. For those that don’t recall, this was a primitive version of Googling for a service you needed.

Coincidentally, there are now many Internet sources that function the same way as the old yellow pages. Better yet, they’re free! Our very own Max Griendling created a list of online citations and a brief guide to get you started. Before proceeding, we wanted to note that you need a website for this to work.

Get Started with Internet Citations >>

Your Mind

Clients aren’t dumb. They know there are options at their disposal to get free advice and tools to invest on their own terms. Despite this, they trust in your experience, background, and education to make the right decision with their money. Never forget that you are the most important tool at a client’s disposal.

How do I get started?

Avoid Superman Syndrome

We know you’re confident in your abilities, but you can’t do this alone. Especially if you are struggling to market yourself, find a consultant that can help before diving into uncharted waters.

Before You Begin

If you choose to speak to a marketing professional, begin by jotting down a list of competitors. Be sure to include why you think they’re competition, what they do different or better than you, how you differ from them, and develop a persona of your current and target clientele.

In addition, you will want to perform a traditional SWOT analysis, which helps you identify your strengths, weaknesses, opportunities, and threats. Whatever you can get out of your head and on paper will help a marketing consultant better assist you.

Establish Goals

What do you want to achieve with your marketing efforts? Even if you aren’t sure if these goals are correct or if they can be achieved, write them down. A marketer will leverage this information to identify the correct tools, services, resources, and budget to get the job done. They can also help you prioritize and refine these goals, making sure they are attainable and within reason.

Make a Plan and Commit

Work with your marketing expert to establish milestones and a thorough plan for reaching those milestones. Once the milestones and tasks are developed, set deadlines to complete each task, and immediately input those deadlines into your work calendar. You’re more likely to commit the time to work on your plan if it’s on your calendar. It will take a lot of time and hard work to reach your milestones, but it will pay off if you are consistent.
If you’re looking to get a fresh start in 2018, now is the time to start building out a plan.

Truth 4: As an independent financial advisor, you’re no longer just an advisor. You’re a business owner and entrepreneur. Start thinking of yourself as one!

One day you’re a wirehouse advisor, and the next you’re building a business from the ground up. Whether you knew it or not, this is the day you decided to become an entrepreneur. This also means you’re responsible for marketing your own business, which for some is a strange, uncharted world. In marketing terms, this means you need to order business cards, create a pitch deck, maintain a website, set appointments, run analytics reports on your clients, and more.

So, if you don’t have personal experience of having ever owned, operated, or run a business, put your learning cap and seat belt on; you’re about to hit some turbulence.

For example, just as a professionally trained chef can cook amazing meals, that doesn’t always equate to operating a successful, profitable and marketable restaurant. Just think about how many restaurants you’ve seen that serve delicious meals, but wind up closing their doors after only a few months of operation.

Preparing for Your Entrepreneurial Journey?

First and foremost, it’s time to change your entire mindset because you, sir or madam, are a business owner and entrepreneur! It’s time to make a strategic and intentional shift that will give you the best possible chance of success, by making some simple changes to your mindset:

Mindset Shift Chart for Financial Advisors

It’s going to take vision, time, and a strong commitment to shift your mindset. To avoid becoming overwhelmed, take it one step at a time. Start by implementing one single point of change per month in your operations, processes, or mindset depending on your level of comfort. Track your progress by taking notes on your completed tasks, on what worked for you, what didn’t, and any adjustments you’ve made at the end of each month.

Up Next

These are two more truths in the 3-part IFP Design Group series, The Truth About Branding for Financial Advisors. Stay tuned for the next article in the coming months. In the meantime, start making some changes around your practice and get those marketing wheels turning.

Have questions or comments? Email Sean Brennan, Director, IFP Design Group.


Learnings from Watching the Death March of the Fiduciary Rule

Major parts of the Department of Labor’s (“DOL(’s)”) new fiduciary rule may- ultimately- oh, so sssslowly- meet their demise. We among the industry have watched in agony with each new twist and turn, spent countless hours reviewing and analyzing the rule and may now wonder what value has been gleaned from all the trauma. Here are a few thoughts about what we have learned:

Sound Practices Prevail

The transition relief from full implementation of the fiduciary rule requires that a fiduciary rendering investment advice comply with the impartial conduct standard. That requires acting only in the best interest of the client, receiving no more than reasonable compensation and making no misrepresentations about services and fees. No formal written policies, procedures or contracts are required.

On its face, this looks simple. Remember: no formal written policies, procedures or contracts are required. Closer evaluation reveals some gaps, however. How do you know you are acting in the best interest of a client if you have no policies or procedures to guide you? Can you tell what is reasonable compensation for services without benchmarking other fees? Might a client believe that you have lied about what services you will perform if you do not describe those services in a well- written agreement?

While not required, having clear policies and procedures, benchmarking your fees and maintaining clearly understandable contracts simply makes sense. Each is a best practice that is likely to increase understanding among parties and to produce happy results. This is nothing new.

Follow the Money- Always

Rollovers are at the core of the fiduciary rule. Retail investment expenses and advisor compensation for an individual’s account will routinely be higher than under a comparable but institutionally priced investment inside a plan. It has been a long-standing rule, however, that an advisor cannot use his or her authority as a fiduciary to gain additional compensation. These transfers therefore create the ideal setting for a conflict of interest. Deep Throat’s caution to Bob Woodward consequently applies. “Follow the money.” If the path leads to more money than keeping the money in the plan, you may have a problem. Investigate and correct as needed.

Good Forms Are Terribly Difficult to Draft but Quite Useful

Many of us have spent the last several months engaged in the arduous task of drafting new forms to support recommendations to switch from a commission-based plan to an advisory arrangement or to rollover assets from an employer-sponsored plan to an IRA or rollover assets between IRAs. The options available to a client seem endless and difficult to explain. When properly completed, however, a good form can be a thing of beauty.

A well-crafted form serves as an educational tool, in and of itself. Written in plain English, it can guide a client through each element of the complex array of available options. This type of disclosure permits the client to make an informed choice, even when the information may be painful to provide.

Once completed, a form becomes a permanent record of the educational process, the recommendations made and what advice was accepted by the client. That’s a nice thing to have on hand in the event of an examination by a regulator. More importantly, it creates an understandable reference document for your client.

The Move of One Regulator to the Front of an Issue Does Not Motivate Another to Take its Stance

The industry has been clamoring for decades for clarity about what fiduciary duties are owed when recommending transfers from plans. The DOL first released its groundbreaking guidance about rollovers in Advisory Opinion 2005-23A, leaving many issues in doubt. Many practitioners hoped that much of the ambiguity would be resolved by the Pension Reform Act of 2006. Unfortunately, new ERISA Section 408(g) was found by many to be unworkable and few advisors have utilized this PRA exemption. FINRA was slow to come to the party but announced its guidance in 2013 with Regulatory Notice 13-45. Among other things, it clearly specified factors to be considered in making a rollover decision.

The DOL’s first attempt at drafting the new fiduciary rule came in 2010, but it withdrew that work in the face of industry outrage. The current rule was published as a final rule April 8, 2016, which became partially effective June 7, 2017, with the survival of the remainder of the provisions now uncertain.

Despite all this activity, we have yet to hear from the SEC, the agency charged with primary responsibility for regulating investment advice. Chairman Jay Clayton released a statement June 1 of this year, conceding that, “the Department of Labor’s Fiduciary Rule may have significant effects on retail investors and entities regulated by the SEC.  It also may have broader effects on our capital markets.  Many of these matters fall within the SEC’s mission of protecting investors; maintaining fair, orderly, and efficient markets; and facilitating capital formation.” With that, he created a new email box for the public to respond to specific questions. There is no definitive commitment as to when the chief regulator may provide any guidance on this important issue.

Data and Statistics Cannot Change a Firmly Held Political View

Much has been written about the thousands of pages, hours of testimony and reams of published studies that have been expended in bringing the fiduciary rule to its current state of unreadiness. The undercurrent of the regulation is clear: its authors fundamentally believed that the industry has taken unfair advantage of retirement investors and needs to be changed. An EBSA News Release, issued April 6, 2016, included bold face bullet points, charging that “Conflicts of Interest in Retirement Advice Are Hurting the Middle Class,” “President Obama Is Cracking Down on Conflicts of Interest,” “Conflicts of Interest in Retirement Advice Cost Savers Billions of Dollars.”
The entry of a new administration brought with it a new political view. The DOL’s the web page for the news release just quoted now includes this proviso, “Please note: As of January 20, 2017, information in some news releases may be out of date or not reflect current policies.”

And so the stance of our regulator has changed. Stay tuned.

Securities offered through LPL Financial member FINRA and SIPC

Investment advisory services offered through Independent Financial Partners, a Registered Investment Adviser

Independent Financial Partners is not owned or controlled by LPL Financial.

Do You Give Investment Advice to IRAs? Then Take Note, the Fiduciary Rule Means You.

President and ERISA Counsel, IFP Plan Advisors

We have heard about the DOL’s new fiduciary rule ad infinitum. However, some advisors may continue to miss the message that the reach of the rule extends well beyond traditional, employer-sponsored retirement plans. Anyone giving investment advice for a fee to an IRA, SIMPLE, SEP or similar account is an ERISA fiduciary under the new rule. That likely means every IFP advisor.

“Why is this significant?” you might ask. When acting as an advisor, rather than a registered representative, you have always been a fiduciary, as defined by the Investment Advisers Act of 1940. You are accustomed to acting in your clients’ best interests. Serving as a fiduciary is a key differentiator in how you approach the individuals that entrust you with their financial well-being, compared to a registered representative that must merely offer what is suitable. With that said, becoming an ERISA fiduciary in addition to being an Advisers Act fiduciary brings new responsibilities, exposes you to higher scrutiny of your actions, and imposes a new standard of care.

How You Get Paid May Create a Conflict of Interest

What is a conflict of interest? As with all things in this industry, just follow the money. The new rule includes compensation that is not “level” as a conflict of interest. Unlevel compensation is any form of payment that might vary with the recommendation you make. The brokerage industry is rife with unlevel payment arrangements. Different mutual funds pay different amounts of compensation; sometimes a registered representative might direct a client to different compensation levels within the same mutual fund. Stocks pay commissions that might be different than bonds. Recommending any particular investment might enable the financial professional to receive more money than recommending an alternative. Any of these presents a conflict of interest. Also conflicted is any payment from a third party. Think revenue sharing and 12b-1s.

The ability to withstand conflicts of interest is vastly different under the Advisers Act and ERISA. Under the Advisers Act, an advisor must disclose all conflicts of interests so that a fully informed client may make an intelligent decision for him or herself about whether to proceed with your recommendation, even if it is made in the face of a conflict of interest. By moving ahead with the advice, the client has waived any real or potential conflicts that were disclosed. Not so under ERISA. Any conflict of interest, as defined by ERISA, is a prohibited transaction. Like the name suggests, if the advisor has a conflict, that transaction cannot proceed; it is prohibited. There is no waiver of an ERISA-prohibited transaction. The only way to engage in the conflicted conduct is to comply with a prohibited transaction exemption.

An Exemption Is Needed to Resolve an ERISA Conflict of Interest

Enter the now infamous Best Interest Contract (“BIC”) exemption to permit the prohibited, conflicted compensation. Unlevel compensation such as commissions and third party payments such as 12b-1s is allowed if the full conditions of the BIC are satisfied. Compliance with all but one of the many onerous conditions of the BIC exemption has been postponed until 2018 so we will not repeat them here.

We at IFP do not plan to take advantage of the full BIC exemption because we believe that it is not needed. Fee-based arrangements such as ours are not considered conflicted because an asset-based fee or a flat dollar fee does not vary with the investments an advisor might recommend. We also do not accept payments from third parties. Once you have established an advisory relationship, you are paid the same amount, regardless of what action you suggest to your client, so you do not give conflicted investment advice. Accordingly, your current arrangements with stand-alone IRAs should be able to continue without change because you do not need an exemption. Should you give advice that results in additional compensation to you, an exemption is required.

Rollovers present the classic examples of potential conflicts of interest. You might be paid 25 bps for helping the plan fiduciary select the investment menu for the plan but charge 100 bps to advise an IRA that you suggested the participant roll into. Each fee is a level fee but your compensation is not the same under each arrangement. The DOL interprets the conflict of interest rules to include situations where your pay may increase as a result of your advice, whether that be from something to more something- or even from zero to something. The prohibition is not limited to advice relating to an employer-sponsored plan. Your advice to take any rollover is itself fiduciary investment advice so receiving any compensation as a result of that recommendation can be deemed to be a conflict.

IFP expects to rely on a short form exemption for level fee arrangements such as these that might create a conflict. A full BIC contract would not be required. Just like compliance with the full BIC, all but one of the simplified conditions of the Level Fee Fiduciary exemption have been delayed until next year.

Full Compliance with the New Rule May Be Delayed but New Forms Will Support Best Practices

The condition that has not been delayed for either the full BIC or the Level Fee Fiduciary exemption is the obligation to satisfy the impartial conduct standards. These standards may be distilled to three requirements:

  1. Act in the best interest of the client,
  2. Receive no more than reasonable compensation, and
  3. Make no misleading statements.

Upon first glance, these standards may seem obvious. Look closer, however. Do you know how to prove that you acted in your client’s best interest? What must you do to comply with that standard? How do you determine what is reasonable pay for an IRA? What is an actionable misleading statement?

You must meet the impartial conduct standards, effective June 9, 2017. IFP will help you create and maintain a record of each of the important criteria. While it is not specifically required that you maintain records of the recommendations you make, we believe that it has always been a best practice to do so. Memories fade, facts change and the comfort level a client may have with an advisor shifts over time, so recording the factors you considered at the time of guiding your client is indispensable. We will help you do that by requiring new forms to document your recommendations for:

  1. Rollovers from a qualified plan to an IRA,
  2. Rollovers between IRAs and similar accounts, and
  3. Transfers from commission-based to advisory arrangements.

The Next Steps

Consider moving all your business to a conflict conscious advisory arrangement. Attend our training sessions. Carefully review and then use the new forms. Ask questions about anything about which you are unclear. Continue what you have always done; act in your clients’ best interests.

Facebook Advertising

Not Using Facebook Ads? You’re a Lunatic.

If I were selling you a Rolex, would you rather pay me $6,000 or $120 for it? Maybe I have a Ferrari I’m getting rid of and I want to give you the option to take it off my hands for either $200,000 or $4,000. Which price would you prefer?

You’d probably agree that these scenarios sound ridiculous, and it may not be a Ferrari or a Rolex at stake, but I’d argue that such a scenario exists right under your nose. Many financial advisors expend a lot of resources on various advertising methods, two of which are direct mail and email marketing. If you’re choosing one or both of those methods and not exploring Facebook advertising, you might be one of those people that would rather pay $200,000 for the Ferrari mentioned above. Let’s explore the tangible and intangible differences between these advertising mediums and why you’re literally a lunatic if you’re an advisor (or any small business owner) and you don’t at least try using Facebook ads.


The all-in cost to advertise in any medium is really comprised of two factors: the cost to design the content and the cost to distribute the content.

Design Cost

For the three channels we’re considering (direct mail, email, and Facebook), let’s assume the cost to design the content is the same across the board; in each scenario, we’ll imagine a graphic designer is using InDesign to put together text and images in a way that’s pleasing to the eye and the resulting graphic can be printed, emailed, or displayed in someone’s Facebook newsfeed. In this scenario, the difference in cost between the three mediums is merely the difference in the cost of distribution.

Distribution Cost

The cost of distributing content via direct mail, email, and Facebook varies based on a lot of factors. For purposes of this succinct blog post, I researched average CPM per medium as an all-in cost metric. I also picked the most conservative CPM averages to make sure I wasn’t cherry picking data just to support my opinion. CPM (cost per thousand), by the way, is a marketing abbreviation used to denote the price of 1,000 advertisement impressions. Essentially, we’re comparing, for each advertising medium, how much it costs to place content in front of 1,000 sets of eyes. You can view the cost comparison below:

Facebook Advertising Cost Comparison

*Direct mail is calculated based on a cost of $0.46 per piece mailed x 1,000 pieces.
Sources: ControlBeaters, Inbox Interactive, AdEspresso

You can see how my Rolex and Ferrari analogies weren’t too far off. A $7 spend on Facebook gets you the same level of exposure that 14x and 65x that amount get you via email and direct mail, respectively. Until the market normalizes, Facebook remains the most lucrative arbitrage opportunity in advertising. In terms of pure cost, there’s no question where, in my opinion, financial advisors should be spending their efforts and money. Also, when you take into consideration the intangible difference between these three mediums, I think my argument becomes even stronger.


To make my argument even simpler, I’m going to eliminate direct mail from this section because of how much more expensive it is than the other mediums. Also, as a young person, I usually only check my physical mailbox maybe once every two months. I’m not saying it’s the mature thing to do, but it’s the reality and I’m sure it’s true for a lot of people in 2017. To even consider direct mail as an advertising method is something I can’t wrap my mind around in this day and age.

Alright, I’ve said my piece, so let’s start our analysis of email marketing vs. Facebook ads.

Email Marketing

Imagine your target prospect’s state of mind while checking emails. They already get hundreds per day and the vast majority of those emails are either newsletters, updates, or unwanted solicitations. My index finger gets tired from hitting delete all day long on those emails. And you know what, I may be deleting a very valid offer of something I actually need from a legitimate company. However, I’ve been beat to death with solicitation emails and I want them out of my inbox as soon as they arrive. So while I might be paying on average $100 for 1,000 email impressions, I would argue that those impressions are similar to the impression a gnat makes when it flies up your nose.

Facebook Ads

What is your prospect’s state of mind when scrolling through their newsfeed? I would say carefree, curious, open, and possibly even attentive. People are proactively signing into Facebook to find interesting content, including posts from their favorite companies. They are choosing to interact on the platform, catch up on current events, and keep up with their friends and family. Of course an ad in their Facebook feed could be disruptive to their experience, but it does feel more natural than yet another unwanted email. And if the content is good enough, be it a message, photo, or video, people will consume it even though it’s clearly labeled with the word ‘Sponsored’. Facebook gives you the opportunity to place content in front of people who are in a state of mind where they’re more willing to consume it. In that state of mind, they’re more willing to do the very thing you want them to do: consider your product or service.


I know I’m barely touching on all the differences between these three advertising mediums, but I just want to get those wheels turning. For instance, we didn’t even talk about how specific the user targeting can get on Facebook. In addition, over 42 percent of Facebook’s users in the United States are between the ages of 25 and 44, which is a crucial target age range for financial advisors who need to build a younger clientele.
There’s really no other way to put it, so I’ll end this like I started it. If you’re a financial advisor that wants to grow their business and you haven’t explored using Facebooks ads, you’re a lunatic.

Securities offered through LPL Financial member FINRA and SIPC
Investment advisory services offered through Independent Financial Partners, a Registered Investment Adviser
Independent Financial Partners is not owned or controlled by LPL Financial.

Top 3 Land Mines To Avoid When Changing Firms

1. A Misaligned Business Model:

Advisors serve client niches and don’t try to be all things to all clients, as do firms.
More and more Financial Advisors are serving client niches, and finding a great deal of success in being a specialist to their clients. Some Advisors cater to small business owners setting up for a liquidity event, while others serve neurosurgeons and not physicians as a whole. The advanced planning a neurosurgeon requires is different than that of a college professor.

Many firms are also going after a specific segment of the Advisor population and have created elaborate infrastructure to provide the highest level of support. This support is necessary to not only provide the means for the Advisor to run an efficient practice, but to be able to spend more time growing their niche, and less on the minutia of running the business. For example, Advisory teams should seek a multi-custodial RIA, Retirement-Plan Advisors should have access to an ERISA attorney and bond traders should have access to a capable desk.

If a firm is currently serving Advisors with similar client needs, business mix, and practice size, they could potentially be a good fit. Additionally, have they transitioned other Advisor teams from your current firm successfully, and do they have the tools and human capital in place to help you get to the next level? After all, you are making the change because you feel that you have outgrown your current firm, probably for a few different reasons. This alone warrants the effort in identifying a firm whose team who has been in your shoes before.

2. The Smoke and Mirrors Behind Payout and Transition Capital:

The economics of making a change are an extremely important part of the conversation and factor in your ultimate decision, but there is more to the story. Payout is far more important than “up front money” in the long-term relationship between an Advisor and his/her firm and really, they shouldn’t be in the same conversation. Understand variable and fixed costs that will be part of the equation, in addition to trading and platform fees, and add-on costs for items that otherwise may be included elsewhere.

Transition capital can be beneficial as income replacement while you are moving clients, especially during the first 30-60 days. Understand the parameters of receiving this capital, which is usually in the form of a note. Revenue or asset retention targets may also play into receiving the full amount. If this is the case, it means 100% of your capital will not be delivered up front.

If you are currently under contract you may be on the hook to your current firm if you leave them. Know what you are walking into and equally important, away from. The proper legal and/or compliance resources and experts exist to provide this critical guidance.

3. Is the recruiter paying you lip service or does that steak have some meat?

Any firm that you speak with will tell you they are service driven and have industry leading technology. Dig in deeper to understand the service model so when you or your staff has questions, or need trouble shooting you will receive the correct answer on the first try. Basic needs like knowing how to access client-account paperwork or more sophisticated needs such as who to contact to evaluate your top client’s advanced planning needs, are essential.

An important conversation Advisors breaking away from a wirehouse or regional firm must have is office space. Access to expertise in this field will guide you through the identification, negotiation and build-out of your new office. If a build out is involved, you want experience on your side. If a firm is large enough, there may be an existing Advisor or team within your area that has available office space.

If the firm’s dedicated technology team isn’t properly credentialed or funded, the tech needs will not keep pace with your business. Or worse, do they not even have a dedicated tech team? If you do not have full access to a wealth management team who can provide sound strategy and guidance to assist in your own portfolio management or provide turnkey model portfolios on your behalf, you are not leveraging resources that should be in place. Ask if the firm will provide complete financial planning services, and if so, are those preparing the deliverable, CFP’s®?

Avoiding these 3 top land mines will help you successfully transition your practice. Being aligned with a firm more closely interested in partnering with you will help ensure long-term success.

Securities offered through LPL Financial member FINRA and SIPC
Investment advisory services offered through Independent Financial Partners, a Registered Investment Adviser
Independent Financial Partners is not owned or controlled by LPL Financial

Comfort Is Killing Your Practice

Comfort – it’s what happens when you stop showing up to your not-so-new-anymore job 30 minutes early. It’s what happens when you start letting yourself eat in the car because the new car smell has worn off. It’s even what happens when you decide to pass a little gas on the couch next to your significant other because you both have been dating for months now and you’ve got that on lock.

In this industry, comfort is what happens when financial advisors move to the independent channel and rely more on client referrals than active cold calling and aggressive marketing. It’s also when they realize they can work Monday through Thursday, 9 a.m. to 4 p.m., make a decent living, and have the oh-so-coveted “work-life balance”.

In case the sarcasm isn’t registering, comfort is NOT good. In my opinion, comfort is one of the biggest reasons most independent financial advisors fail to reach their full potential as business owners and entrepreneurs. Now, I’m not saying that advisors don’t want to evolve and grow. However, many advisors easily maintain enough fee-based assets to generate recurring annual net incomes north of $150k. For many, this means that there’s a sort of safety net hampering any motivation to evolve their practice. The two examples below illustrate the negative side of comfort.

Example 1: Branding

For the most part, advisors are the worst when it comes to branding. Many of them don’t even want to discuss it because they don’t see how it will get them new clients. To add to it, the ones that do attempt to brand themselves will pay some outdated marketing firm too much money for a blurry logo and a website that’s full of what I call Viagra pictures – random people positioned awkwardly in a meadow or conference room. They do this because they’d rather go with the cheapest option since they’re unsure of the actual ROI and they’re too comfortable to research further.

Example 2: Learning New Things

Comfort seems to prevent advisors from continued learning. Early in their careers, advisors are soaking in all kinds of knowledge and seek to understand the products and services they need to offer clients. However, as they gain experience, many of them become less and less willing to learn new things and adapt to changes in our industry. For instance, take the idea of multi-generational planning. The need is greater than ever for advisors to leave transactional business in the past and embrace planning, not only for a client, but also for a client’s children. This means pro-actively connecting with those children, and it could also mean learning how fixed insurance fits into a client’s overall estate plan; both of these would require LEARNING and EVOLVING as an advisor.

Comfort Affects Your Bottom Line

I suppose many independent advisors fail to evolve or don’t want to learn because they see retirement for themselves 5 to 10 years down the road. Sure, it’s nice to run a cash flow analysis based on recurring revenue at a 2x multiple and imagine a nice liquidation event that can fund a life of mai tais and couples massages. Even if that were the case, why wouldn’t you want to maximize that liquidation event? Consider this: 66% of heirs change financial advisors upon inheriting their parent’s wealth. Let’s say I, as a millennial advisor, am looking to purchase a practice from a retiring advisor. You better believe I’m going to discount my offer price if I see no effort by the advisor to cultivate relationships with the next generation or provide estate and insurance planning for his or her clients. If anything is going to motivate an advisor to get out of his or her comfort zone, I would think a hit to their bottom line would do the trick.

Final Thoughts

It amazes me how many people in life become comfortable with their situation and lose the desire to constantly strive toward greatness. If you’re a business owner of any kind and you’re not constantly paying attention to shifting trends in your industry and evolving your business as necessary, you’re robbing yourself and the world of your full potential. I’m sure as parents you wouldn’t tell your children that it’s ok to be comfortable with B’s and C’s, so why do so many of us settle for less than we’re capable of? Do more. Do better. Constantly evolve. If just one person hears this message and embraces it, then it’s been worth my time crafting it.

Want to get out of your comfort zone or talk about IFP? Send me an email and we can chat.

Securities offered through LPL Financial member FINRA and SIPC
Investment advisory services offered through Independent Financial Partners, a Registered Investment Adviser
Independent Financial Partners is not owned or controlled by LPL Financial

The Truth About Branding for Financial Advisors Part 1

This month’s article of Cut The Wire is the first of three articles brought to you by the IFP Design Group, IFP’s in-house team of experienced and incredibly passionate branding, design, and marketing strategists and consultants. The team acts as the advisor’s ‘design fiduciary’ while assisting IFP advisors with developing and owning their brand and brand assets. The Design Group helps advisors transform their practice into a strategic brand effectively utilizing design, business strategy and unique messaging that appeals to current and prospective clients. Now on to the good stuff.

As the director of the IFP Design Group, I speak with and work alongside financial advisors every day. My team and I find ourselves constantly repeating or kindly correcting advisors in conversations relating to branding, design or marketing of their practice. While some of their thoughts or theories is your run-of-the-mill confusion, a good portion has been truly eye-opening. I find myself cringing (and often biting my tongue) when I hear advisors say something that can be harmful to their brand, business development opportunities and how their practice is positioned or perceived. As if that’s not bad enough, advisors get terrible advice or advice in a vacuum via webinars and conferences they regularly attend – often being told what they want to hear about branding and marketing, not what they should hear. After returning home from those events, they continue running their practice with inaccurate information, beliefs, or mindsets. In most instances, it’s a simple case of not knowing what they don’t know. That’s not their fault, but that doesn’t mean that’s a good thing.

Through this article and the following articles in this series, I hope to provide advisors with answers to many branding, design, and marketing-related questions and struggles advisors have, but rarely ask. I’ll also address what I see as naive, uninformed, inaccurate, and often very antiquated approaches and beliefs. Most importantly, I’ll provide sound guidance, advice, actionable steps and recommendations. What I write and the tone in which I write this article may seem a little blunt, but I think it’s something advisors need to hear; call it tough love. It’s time for advisors to have a reality check and a wakeup call about branding, design and marketing in the financial services sector.

Truth 1: You Must Invest in Your Brand

From websites to industry publications, newsletters and blogs, the terms brands and branding are very relevant in this industry, as they should be. Unfortunately, the use of those words are typically used synonymously, interchangeably and often incorrectly. As one small example, I’ve experienced situations where an advisor talks about their brand in reference to their logo. It’s been said many times in many places, but it’s worth repeating: your logo is not your brand and your brand is not your logo.

Before we jump into the meat and potatoes of this article, it’s important to have a general definition of branding in the modern era. There isn’t one absolute definition of a brand, however, here’s the general definition of a brand as I know it:

A brand is a promise to provide a meaningful experience between an organization and its customers that is delivered on a consistent basis across all brand touch points. If properly and consistently managed and executed, creates value, resonance, differentiation and influence over time.

It’s important not to confuse the term brand with the phrase branding. Here’s a general definition of branding:

Branding is what you do and how you go about establishing your brand’s differentiated meaning in other people’s minds. It’s the creation and application stage.

Advisors often say to me, “Sean, I need help creating and marketing my brand.” In many cases I will tell them point blank, “You don’t have a brand and have very little or nothing to market. You first need something to market before you can utilize marketing.” I typically receive a pretty perplexed look but, after the shock wears off, I have to take a few steps back to explain.

The journey to define and establish a brand truly is hard work and begins when advisors start taking a deeper look at the ideological and strategic components that comprise their practice. During the early brand development conversations, we often uncover a lot of these possibilities, areas for improvement and strategic opportunities.

First Things First: Ask the Right Questions

Among the many, many questions I ask, there are two questions that help obtain a quick assessment of the client and situation:

Do you have a budget line item for the on-going branding, design and marketing assets and needs of your firm?
So far, of over 400 advisors I’ve asked this question to, only 5 advisors have said yes.

How much time do you spend (individually or with your team) on a monthly or annual basis to strategize, review or discuss your brand?
Of over 400 advisors I’ve asked this question to, those same 5 five advisors have been the only ones to actually do it.

If your answer to either of those questions was no, ask yourself this question: how important is your brand to you? More importantly, what should you do from here?

Start by creating an annual brand maintenance checklist. Identify what you need to do on a monthly, bi-monthly, bi-annual or annual basis to invest in and maintain your brand. You do that for your clients. You even do that for your car. Why wouldn’t you do that for your own brand?

Like a bad patient who doesn’t listen to their dentist, ignores cavities, and hopes they go away, ignoring your brand will not make it better. If you ignore it and don’t invest in it, that too will go away in time. This means that if you have any interest or desire to develop and transform your practice into a meaningful brand, you need to step up and fully invest your time, resources and energy to make it happen.

There’s No Such Thing As Automatic Marketing or Branding
Despite what you’ve likely heard, professional, strategy-driven and executed design, branding or marketing initiatives don’t happen overnight. It’s equally important to understand that the ability to see or measure results or improvements is not automatic or instantaneous.

First, before results or metrics can even be analyzed, you need to define clear KPIs (Key Performance Indicators) or SPs (Strategic Priorities) or other measurements for success. In other words, you need a plan. Updating your website, redesigning the logo, writing a blog post, spending money on brochures printed on glossy paper, or creating a ‘cool’ video is not a strategy. Those are merely parts of what should be a larger whole – an overarching marketing and brand strategy for your business.

Second, successful marketing and branding requires on-going commitment, investment, resources and engagement from advisors. Remember, you’re not just an advisor. You’re also a business owner and entrepreneur. Therefore, any services, tools, social media, newsletters, content or efforts you have set to be ‘automatically’ produced or distributed serve no strategic purpose. They become individual, unorganized parts that aren’t aligned with your brand’s messaging and underlying strategy. Why? Because they are too vague, not specific or relevant to your audience and provide little to no value to your current or prospective client. Therefore, they provide no value to you or your practice. For this to work, you don’t have to be a marketing or branding expert, but you do have to be actively engaged on a regular basis.

What Can You Do?
If it exists, take a little time to review your strategy. If you don’t have one, take a step back and create one. If you don’t know how to create one, find a professional and, if necessary, spend money to get the help you desperately need.

How Do You Hire the Right Person or Firm?
Just as your clients look for an advisor with the credentials, experience, and skills to manage their assets, you need to find a highly qualified branding or marketing firm or professional for your business. Like many professions, a creative agency or professional will likely have a portfolio of completed work. Use this portfolio to gauge their potential and see if they’re the right fit for your firm.

Another potential quality gauge is the length of their career. Like many before you, it may be tempting to hire a relative or friend to design something for you. In addition, you will likely find numerous inexpensive online resources at your disposal. These are the quickest, cheapest and easiest solution if you don’t see the potential value of investing in a successful brand. However, if your brand matters to you, don’t take the risk of hiring an inexperienced, unprofessional, or automated service to create your firm’s equity and assets.

To put things in context, if a professional designer or marketer was looking to hire a financial advisor, they can probably ask someone they know that has a reputation for being good with money. They can also go online and sign up to use a robo-advisor for a very low fee thinking they were getting a fiduciary level of care and guidance. If they truly cared about their financial future, why would they take the risk of hiring an inexperienced, unprofessional, or automated service to create a financial plan? As financial advisors know, that’s a risky wealth management and retirement planning strategy that advisor would never suggest for their clients. So why would you take that same risky approach for your brand?

What Should You Expect From a Professional?
Let’s start with a few minimum expectations. You need someone that works with you as a partner, not someone who works for you. That person or firm should first examine your business’s problems or needs and ask the important, high-level questions that are focused on helping your practice grow. Don’t just look for a firm or professional that uses templated solutions or who claims that they’re simply good with software. Also, don’t fall for those people who only want to manage a social media account or offers to completely take over your marketing. A promise like that would be the equivalent to believing Bernie Madoff when he told his prospective clients he had a secret, proprietary formula for success.

They must understand how to establish and define your strategy, success factors, metrics, and business and marketing goals along the way. Chances are, you don’t know how to do that or you would have that information established already. Find a professional or team that openly and consistently communicates while also making course corrections as your projects progress. You need someone who bases their decisions and recommendations on a strategy, research and industry standards – not on personal likes, dislikes, or a whim. They should provide value beyond the obvious and work with your best interests in mind. In the end, it’s less about what you want, it’s more about what your clients and prospective clients need.

These are just a few criteria and expectations to keep an eye out for. This should sound familiar to you. This is because the expectations and processes are very similar to your fiduciary responsibilities. Think about it. Before you can create the best and most appropriate financial plan for your clients, you must have a deep understanding of your client’s goals, milestones, lifestyle, assets, debts, vision and more. You tell clients not to expect to see their wealth increase overnight or even in a few months. It takes time, careful management, curation, commitment, focus, dedication and even a financial commitment to work towards success. The same approach equally applies to the long-term management and investment in your brand.

Final Thoughts
Just as you expect to be fairly compensated for the value you provide to clients, so do branding, design and marketing professionals. Having a passive, complacent and non-engaged mindset is harmful to the success of your practice. Remember, there’s no such thing as free, cheap or automatic branding, design, marketing and results.

This article is part one of a three part in the series. Stay tuned for the next article in the coming weeks. Want to learn more or get on a mailing list to be the first to receive future articles? Have questions or comments? Email Sean Brennan, Director, IFP Design Group.

Securities offered through LPL Financial member FINRA and SIPC
Investment advisory services offered through Independent Financial Partners, a Registered Investment Adviser
Independent Financial Partners is not owned or controlled by LPL Financial