Nov 03 On Course/F - Compass Planning Associates

WITH
JENNIFER LANE
ON COURSE
NOVEMBER 2003
Eight Faneuil Hall
Marketplace
3rd Floor
Boston, MA 02109
70 Walnut Street
Wellesley Hills, MA 02481
Phone:
888-320-9993
Fax:
781-239-7590
CompassPlanning.com
P R E S E N TAT I O N
IN
CONNECTICUT
O
n a gorgeous fall day this past October, I drove to Southbury, Connecticut, for
a speaking engagement at the 21st Annual Conference of the Business Women’s
Forum of the Waterbury Chamber of Commerce.The two-hour drive gave me
a rare opportunity to enjoy the spectacular foliage along the highway as I reviewed in
my mind the key points to make to this group of 40 seasoned, successful businesswomen.
The title of my talk was “Women, Money & Power: Investing In All Climates.”
Though there are always some pre-event jitters for me before a presentation, once I start
talking my focus quickly shifts to helping people to understand and access solid, useable
information about their wealth strategies. It was a dynamic experience for me – I always
get energized when I have an opportunity to talk about my favorite topic: money
management. And the questions following my talk are of interest to me because they
reveal common gaps in people’s knowledge as well as their emotional fears about money –
and we all have some of those!
One question asked that day has a complex answer. It’s a question I hear often: “What is
the difference between a broker and a financial planner?” I’d like to explain the difference
and guide you toward making a good choice that fits your needs.
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BROKER
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FINANCIAL PLANNER
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A broker is an investment professional who
gives investment advice and sells products.
The broker works through a broker-dealer,
most often a large company that manages
a number of brokers, who are registered
representatives. Examples of broker-dealers
include John Hancock Financial Services
and Merrill Lynch. Broker-dealers provide
their registered representatives with ongoing
training and oversight and may influence
what investment recommendations they make.
The National Association of Securities
Dealers (NASD) is the regulatory agency
overseeing all broker-dealers. Brokers
often work on commission paid
for each transaction or earn
a fee based on the percentage
of the total investment.
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Financial planning is big-picture planning
that takes into consideration all your assets,
priorities, and life goals and guides you
toward wise choices. Anyone can say he / she
is a financial planner and give you advice
about how to protect and use your wealth.
If credentials are important to you – and
they should be – choose to work with
a Certified Financial Planner who has
completed a rigorous course of study
and passed qualifying exams that prepare
him / her to advise you on financial planning,
taxes, investments, estate planning, and
retirement planning – in other words, the
big picture.
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continued on reverse side
F O R YO U R
INFORMATION
WHAT ARE
YOUR NEEDS?
If you have a sum of
money to invest, a broker
may be the right choice
for you. But, for a more
holistic approach that
considers your goals
and all your assets, select
a Certified Financial
Planner. In all cases,
find out about how your
financial advisor’s money
is earned, what services
are provided, the
credentials they hold,
and their ongoing
training and professional
development.
HOW
MUCH
INTERACTION
DO YOU WANT?
If you choose to work
with a Certified Financial
Planner, you are more
likely to have regular
contact and discussion
about your financial
situation, your personal
goals, and your lifestyle
needs.
My goal is to empower
my clients by developing
their skills, knowledge,
and confidence. It’s
gratifying to me when a
client reaches a financial
goal they previously
thought was unattainable.
Money situations always
have emotions wrapped
around them. I like to
untangle and unwrap the
package and guide people
to get their wealth
working on their behalf.
Jennifer appears on NECN
every Tuesday at 6:30 and 7:30 pm.
Check out the Tools Page
at CompassPlanning.com
for available downloads
continued from reverse side
REGISTERED INVESTMENT ADVISOR
I started my own career many years ago as
a broker and quickly learned that my clients
needed answers to questions that went
beyond investments. I saw that being a
broker limited my ability to do that, so I
decided to become a Certified Financial
Planner and a registered investment advisor –
a great decision that opened up new
domains for me.
Order your holiday gift books:
The Everything Get Rich Book
by Jennifer Lane
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Registered investment advisors provide
investment advice and often handle
transactions for their clients. They are
subject to the regulations of the Securities &
Exchange Commission and /or a regulatory
agency in their state (depending upon the
total amount of the investments they manage),
and, typically, they charge either an hourly
fee for their work, a flat fee, or a fee based
on the amount of the investments they
are overseeing.
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One important distinction in choosing your
financial advisor is how their fee is earned.
Some financial advisors work on commission
and some do not. When a financial advisor
works on commission, each new transaction
you make generates a fee.
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Certified Financial Planners are required
to complete a more integrated program of
study to earn their certification, with ethics
embedded throughout the entire course
of study. Following their certification,
CFP’s are subject to continuing education
requirements in all areas of financial
planning and ethics.
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What I recommend and follow in my own
business is to charge a flat fee for the project
or an hourly rate, which I believe to be
the most favorable and fair policy for all
concerned.
Registered investment advisors and brokers
must pass equally stringent exams on investing
and industry regulation. Following that,
brokers have continuing education requirements with an emphasis on ethics, in part,
because of the potential for a split allegiance
to the broker-dealer and to the client.
Registered investment advisors do not have
the same continuing education requirement.
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FEES
TRAINING AND EXPERTISE
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The regulatory agencies responsible for
oversight of both brokers and registered
investment advisors conduct onsite inspections
to ensure adherence to rules and regulations
governing the investment field.
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Phone: 888-320-9993
CompassPlanning.com
© 2003 All rights reserved.
Compass Planning, Wellesley, MA