Broker Check

801 West Bay Drive Suite 707 Largo, FL 33770

(727) 210-7795
marc.delia@premierplanninginc.com
Download Brochure
Premier Planning Partners Home
Premier Planning Partners Home
  • Home
  • About Us 
    • Meet Our Team
    • Financial Planning Philosophy
    • Business Philosophy
    • Investment Philosophy
  • Services 
    • A Blueprint for Business Succession Planning
    • Comprehensive Financial Planning
    • Levels of Partnership
  • Our News 
    • Premier Insights
  • Resources 
    • Retirement
    • Estate
    • Investment
    • Insurance
    • Tax
    • Money
    • Lifestyle
    • Glossary
    • Tax Resources
  • Contact
  • Account Access 
    • Client Login
    • Wealth Management Platform
    • American Funds
    • Lincoln Financial Group
    • Midland National
    • Nationwide
    • Ohio National
    • Symmetry Partners
Download Brochure

Why People Want Independent Financial Advice

Marc D'Elia
October 01, 2020
Share |

Why People Want Independent Financial Advice

In some cases, “independent” is better.

Times have changed – and so have financial advisors. Today, people don’t want financial advice from a salesman. Instead, they want a relationship with a financial professional who is candid, trustworthy and thoroughly educated, and who provides personalized financial advice for each client. That search often leads them to a fee-based or fee-only financial advisor or a Registered Investment Advisor.

A pleasant alternative to Wall Street.

A paradigm shift has happened, and the traditional brokerage houses are witnessing its impact. Although old-school “stock brokers” have pretty much gone the way of the wooly mammoth, you still have a sales-first mentality in place at the big banks and Wall Street brokerages. If you’re employed by one of them, the mantra is simple: make a sale, earn a commission. As they try to serve their clients, these “wirehouse” brokers regularly contend with sales quotas and the inherent potential for conflicts of interest.

In a Charles Schwab survey of brokers at large financial firms, 78% of the respondents expressed their belief that their clients felt more loyalty to them than the Wall Street firm and that 70% of their clients would follow them if they left it. Many investment professionals start their careers with the wirehouses, and 65% of the brokers under the age of 40 surveyed said becoming an independent Registered Investment Advisor appealed to them. Not only that, 76% of respondents felt that the number of registered representatives leaving the wirehouses would increase in the coming years.1,2

Consumers are savvy, and it isn’t surprising that they are turning elsewhere for financial advice. In particular, there are three popular resources.

A fee-based financial advisor has structured his or her practice to promote earning income from fees instead of commissions. The emphasis is on advice. An independent, fee-based financial advisor also has freedom – freedom to choose the most appropriate products and services for your risk tolerance and investment goals. (More about that in a moment.)

Fee-only financial advisors earn no commissions at all. They derive 100% of their income from client fees, either annual management fees or hourly or per-project consulting fees. With this compensation arrangement, you know that the advisor is available to help you address myriad issues in your financial life, not simply those that could generate commissions linked to product sales.

A Registered Investment Advisor (RIA) usually works to manage the assets of high net worth investors. The management fees usually represent a percentage of the assets a client has invested. RIAs have to register with the Securities and Exchange Commission or the securities authorities in the states in which they operate. They also have a fiduciary duty to their clients – that is, their actions and investment recommendations must be in the client’s best interest.3

People need comprehensive advice. That’s probably the #1 reason why people seek an independent financial advisor. They know that the advice they receive is not shaped just by sales incentives or directives. There is often a candor to the discussion that may not always be present at a bank or a brokerage.

People want more investment choices. An independent financial advisor is free to offer investments from dozens, maybe hundreds of companies, rather than the investments of a single company. In addition, that independent advisor can unhesitatingly tell you if an investment is or isn’t appropriate for your financial situation.

This is the age of independence. When it comes to the financial future, no one wants to be “sold” – just advised. That’s why we’ve seen the rise of a new kind of financial advisor who puts the client relationship first.

       

  

Citations.

1 - pressroom.aboutschwab.com/press-release/schwab-advisor-services-news/majority-investment-advisors-expect-increase-advisors-mov [2/28/12]

2 - riabiz.com/a/11600418/fed-up-wirehouse-advisors-more-eager-to-leave-than-ever-study-says [2/28/12]

3 - investopedia.com/terms/r/ria.asp [8/25/14]

Contact

Office: (727) 210-7795

Fax: (727) 245-6900

801 West Bay Drive

Suite 707

Largo, FL 33770

Send an Email

Quick Links

  • Retirement
  • Investment
  • Estate
  • Insurance
  • Tax
  • Money
  • Lifestyle
  • All Articles
  • All Videos
  • All Calculators
  • All Presentations

Check the background of your financial professional on FINRA's BrokerCheck.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. Some of this material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named representative, broker - dealer, state - or SEC - registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.

We take protecting your data and privacy very seriously. As of January 1, 2020 the California Consumer Privacy Act (CCPA) suggests the following link as an extra measure to safeguard your data: Do not sell my personal information.

Copyright 2023 FMG Suite.

Terms of Service | Privacy Policy

This website is for educational or informational purposes. It is not intended as investment, legal, retirement or tax advice.

Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC.

The LPL Financial registered representative(s) associated with this website may discuss and/or transact business only with residents of the states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.