Comments on: Financial Advisers and Stock Brokers: What’s the Difference?

By: Darkhorse

Darkhorse — Sat, 11 Sep 2010 14:30:00 +0000

You’re better off going to a trust department in a bank, percentage based fee (the better they do for you the better fee they take), held to a higher ethical standard,(prudent investor rule), plus the banks reputation depends on a well run department, and banks are all about community, and trust departments are subject to OCC examination. They tend to be a little more conservative in their investments but in times like we have been through and are going through now….thats your best bet.

By: Luttrell Josh

Luttrell Josh — Tue, 07 Sep 2010 13:53:00 +0000

Thats Ignorant, the 66 is a combination of the 65 and 63. The Sec made the test to short-cut taking two test. People who get the 65 just cant pass the 66, so they use it as a escape goat. Good try though!

By: Kirk Kinder

Kirk Kinder — Sat, 10 Oct 2009 00:21:44 +0000

Cameron,

The series 65 distinguishes an advisor who is required to act as a fiduciary. Those with a 7 or 66 are salesmen and are regulated as such. I am registered as a 65, and I place trades for clients. I just don’t make commissions. It has nothing to do with trading. The difference deals with regulation.

By: Cameron Williams

Cameron Williams — Thu, 08 Oct 2009 19:42:45 +0000

Can anyone explain what purpose an RIA serves? If you have to have a Series 6/7/66 to execute trades, what does someone with a Series 65 contribute? I am interested in attaining the Series 65 because I don’t work for a firm who can sponsor me for the 6/7/66. Thanks for any input received.
Cameron

By: Pat

Pat — Mon, 09 Feb 2009 23:01:49 +0000

Simplified rules for investing need to be made available for unsophisticated investors who do not know what brokers or investment advisors are permitted to do, and what they aren’t.

The entire realm of status and relationships in the investment industry is obscured which prevents customers from account oversight, and favors fraud.

No wonder there is a bail out – that taxpayers must pay for.

By: Deltablues

Deltablues — Wed, 10 Oct 2007 15:20:53 +0000

To be clear, ANYONE can call themselves a financial adviser, a wealth management specialist, or retirement counselor.

The title “financial advisor” means nothing.

You must be licensed to sell advice, securities (stocks, bonds, funds), or insurance.

Those duly licensed are legally titled “Investor Adviser Representative” (the business is registered as the investment adviser), “Registered Representative (RR)”, and “Insurance Agent (IA)”, respectively.

The shame is most “financial advisers” operate as all three. Don’t fall victim to the sales guys who are pretending to be objective “advisers”. If they are RRs or IAs they are most certainly NOT! Just ask, before you meet.

Hope that helps!

By: Kirk Kinder

Kirk Kinder — Fri, 21 Sep 2007 19:44:40 +0000

Flexo is pretty much right on with his analysis. I would add a couple points. One, a broker can call himself a financial advisor. What you need to look for if hiring a planner is a registered investment advisor (RIA). You can tell if you are working with an RIA by asking if the planner is a fiduciary. A fiduciary has a legal obligation to put your interest first, above all others, including his own. All RIAs act as fiduciaries.

However, your work isn’t done if you find an RIA. Most RIAs still accept commissions. In fact, 70% of the average RIAs compensation comes from commissions. These planners call themselves fee-based, but you need to look at their form ADV to see how much of their revenue is from fees and how much from commissions.

I am a fee-only planner so I don’t earn any compensation from commissions. Obviously, I think this is the way to work with an advisor because you know you eliminated the biggest conflict of interest found in a planner relationship.

So I recommend finding a registered investment advisor who is fee-only. Of course, I am biased.