One of the misconceptions we are faced with in the financial services industry is the idea that all “financial people” are the same. We sometimes hear the question,
"What is the difference between the advisors at Creekmur Wealth and the insurance agent or broker's office down the street?"
Even though it is hard to notice from the outside, there are some important differences. There are many business people that call themselves financial advisors or financial planners, but there is really no uniform standard to define these terms.
If an individual can pass a test to sell insurance or some level of financial security they are considered to be licensed and in the current regulatory environment can use the titles financial advisor, financial planner, investment manager, etc. This can be confusing to consumers because these titles are somewhat interchangeable and do not have standard definitions.
Below I will outline the differences between working with a wealth management firm like Creekmur Wealth rather than a broker, agent, or company-sponsored salesperson.
Primary Loyalty: A company employee's first responsibility is to the company that employs them. In some cases investment companies give preference to specific investments and/or products regardless of what is truly most beneficial for the client. For an insurance agent, the state life insurance laws state that the first allegiance of the agent is to the company, not the client.
As a privately-owned company, we are able to place the needs and goals of our clients above our own goals. We are not required to make recommendations from a short list of options and we are not limited to products from one or just a few companies. We have the ability to find the highest quality solution to most efficiently meet our client's needs.
Compensation: Investment professionals receive compensation when they make a sale. They may be paid in the form of a commission when they sell a product or a fee that is a percentage of client assets. You may hear a professional say that their company pays them - remember, there is no such thing as a free lunch. In this case you might ask about the additional fees that are charged in the account or product they are recommending.
At Creekmur Wealth, we are compensated in a couple of different ways. Regardless of how you choose to work with us, we will be sure you understand how we are being paid for the work we do.
- Financial Planning Fee - In this case we charge a specific fee to complete a stated scope of financial planning. IE: tax planning, retirement planning, education funding plan, etc
- Asset Based Fee - This is the fee we charge to actively manage your investment portfolio. We are able then to buy and sell investment holdings on your behalf without commissions being charged to you.
- All of our fees are disclosed publicly on our Form ADV Part 2A. The most recent copy of this document is always linked on our website at the bottom of the home page and is available by calling our office.
- Commission Based products - In some situations we may recommend a product for which we will receive a commission. This may include life insurance, long-term care, and annuity products. We would recommend such an investment tool for a specific purpose within your financial plan.
Advisor Credentials: There are no educational requirements for an individual who wants to become a "financial advisor." At Creekmur Wealth we recognize the value of continuing education. In addition to a bachelor's degree and required licensing, many of our advisors have extended their education into advanced training such as Master's coursework and advanced certifications such as the Certified Financial Planner™ designation. We strongly recommend that you work with a financial professional with at least some level of advanced certification.
Clearly Defined Process: After 25+ years of working with individuals and families on their financial planning and investment management we have learned that a clearly defined process is key to helping our clients move toward their goals. Through the years we have sat in meetings with people who are interviewing new financial advisors because they were frustrated by the lack of clarity around investment decisions being made in their accounts, lack of access to meeting with their advisor, or difficulty getting help with service needs.
Goals-Based Planning Process: During your initial "Foundation" meeting with an advisor at Creekmur Wealth we will start by asking you questions regarding your financial situation, your current investments, and your goals for the future. We recognize that your situation is unique and we want to understand your perspective and goals first.
From here our financial planning team will do research and analysis so that we can make recommendations that will help you move toward your desired outcomes. We consider your entire financial picture including tax impact, risk, fees, estate implications.
Defined Asset Management Process: We complete internal analysis of portfolios, holdings, and opportunities to actively manage risk-based portfolios to accomplish stated objectives. We do not receive commissions when we manage portfolios. Read more about our Wealth Solutions here.
Our Guiding Objective: We help good people make great decisions so they can live incredible lives!
Here are some questions that you should ask of the professional that you are considering as your professional partner in working toward your financial planning goals.
- How long have you been a financial advisor?
- Are you a fiduciary? Please describe what that means to you…
- Do you hold any professional certifications or designations? ie: CFP,CPA, JD
- What educational degrees have you acquired?
- What services do you offer?
- What’s your investment strategy or style?
- What is your planning process to help me realize my goals?
- How are you compensated? And how much will I be charged for your services?
- When, how and how often do you talk to clients?
