Volume 18 No 1 January-February 2017
IN THIS ISSUE Stop Getting the Silent Treatment Investment Psychology More Than Money Wealth Management: Beyond the Horizon: If You Could Only See What I See Too Busy To Grow Your Business?… Read This! (5-Minutes) Official IARFC Publication www.IARFC.org
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
Barry L. Dayley, RFC
®
C ode of Ethics A Conscience for the Company
DOMESTIC BOARD OF DIRECTORS Chairman, H. Stephen Bailey, LUTCF, CEBA, CEP, CSA, RFC® CEO, Edwin P. Morrow, CLU, ChFC, RFC® Vice Chairman, Nicholas A. Royer, RFC
Director, Isabel J. Cooper, MBA, RFC® Director, James B. Moss, CEP®, RFC® Director, Angie D. Trandai, CFP®, RFC®
®
www.IARFC.org/Register 1046 Summit Drive Middletown, OH 45042-0506 800.532.9060
Director, Mayo M. Woodward, CRPC®, RFC®
President, Peter J. D’Arruda, RFC
®
Editor-in-Chief Wendy M. Kennedy editor@iarfc.org
Treasurer, Jon M. Rogers, Ph.D., CLU, ChFC, RFC®
Editor Susan M. Cappa susan@iarfc.org
Secretary, Michelle Blair, RFC®
Editorial Advisory Committee
INTERNATIONAL LEADERS
Peter J. D’Arruda, RFC® Michelle Blair, RFC®
Asia Chair, Jeffrey Chiew, DBA, CLU, ChFC, CFP®, RFC®
India Deputy Chair, Vijay S. Wadagbalkar, RFC®
China Development Organization (IMM) (China, Hong Kong, Macao & Taiwan), Liang Tien Lung, RFC®
Indonesia Chair, Aidil Akbar Madjid, MBA, RFC® Malaysia Chair, Ng Jyi Vei, ChFC, CFP®, RFC®
Australia and New Zealand Chair, George Flack, CFP®, FIPA, AFAIM, RFC®
Pakistan Chair, Zahid Khan, RFC®
Bermuda Chair, Antony Francis, RFC®
Philippines Chair, Ralph Liew, RFC®
China Chair, Kai Tu Yuan, RFC®
Taiwan Chair, Richard Wu, RFC®
Hong Kong and Macau Honorary Chair, Samuel W. K. Yung, MH, CFP®, MFP, FChFP, RFC®
Trinidad Chair, Inshan Meahjohn, RFC®
Articles, comments and letters are welcomed by email to: Wendy M. Kennedy editor@iarfc.org
Hong Kong and Macao, Chair, Teresa So, Ph.D., MFP, RFP, FChFP, RFC®
INTERNATIONAL WEBSITES
IARFC US OFFICE ASSOCIATE TEAM
China — www.iarfc.cn
Operations Manager, Charlotte Isbell
Hong Kong — www.iarfc-hk.org
Membership Services Vicki Caplinger Taylor W. Back
India — www.iarfcindia.org Indonesia — www.iarfcindonesia.com
Public Relations, Susan M. Cappa
Philippines — www.iarfcphilippines.org
Editorial Coordinator, Wendy M. Kennedy
Taiwan — www.iarfc.org.tw
IT, Randy Kriner
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
The Register | January-February 2017
The Register is published by the International Association of Registered Financial Consultants ©2017, It includes articles and advice on technical subjects, economic events, regulatory actions and practice management. The IARFC makes no claim as to accuracy and does not guarantee or endorse any product or service that may be advertised or featured.
Periodicals Postage Paid at Mansfield, Ohio. POSTMASTER: Send address changes to: P.O. Box 42506, Middletown, Ohio 45042-0506 SSN 1556-4045
Advertise The Register reaches 4,000 financial professionals every issue. Register advertising is an easy and cost-effective way to promote your company’s products and service to this dedicated audience. To advertise contact: 309.483.6467 advertise@iarfc.org www.iarfc.org Page 1
New IARFC Members Domestic Members
Member Referrer Recognition
Gregory M. Babcock, RFC®, CA Jeffrey L. Boddy, RFC®, NM Bridget E. DePu, RFC®, FL Kenneth R. Femiano, RFC®, NY James R. Hardesty, RFC®, CO Larsen A. K. Ibara, RFC®, HI Hilary L. Renno, RFC®, MI Donald L. Ross, RFC®, OH Marco A. Scalco, RFC®, CA Steven T. Vrooman, RFC®, CO
Barry Dayley, RFC® Rodney Harris, RFC® John Hernandez, RFC® Russell G. Luce, RFC® Chris Roberts, RFC® Nicholas Royer, RFC®
International Members
Member Referrer Recognition John E. Hernandez, RFC ® Russell G. Luce, RFC ®
Indonesia 13 Philippines 13 Taiwan 28 China 203
John E. Hernandez, RFC ® Russell G. Luce, RFC ®
Journal of Personal Finance
Events Calendar
Access the full online version by visiting journalofpersonalfinance.com or by joining the IARFC. Hard and Adobe PDF copies are available to Members and Non-Members: Order today. http://store.iarfc.org/publications.aspx
2017 March Board of Directors March 14 – 15, 2017 Charlotte, NC
IARFC Blog: http://iarfc.org/iarfc-blog Contact susan@IARFC.org for assistance with IARFC Blog
2016 Loren Dunton Memorial Award Presentation March 30, 2017 Utah Valley University, Orem Utah 2017 Loren Dunton Memorial Award Presentation TBD, 2017 Founder’s Award TBD, 2017 Members Award TBD, 2017
Page 2
Join the IARFC on LinkedIn Contact editor@IARFC.org for assistance with IARFC LinkedIn
Follow us at Facebook.com Contact editor@IARFC.org for assistance with IARFC Facebook The Register | January-February 2017
In This ISSUE
Volume 18 No. 1
Cover Story
Columns
Register Cover: Barry L. Dayley
Chairman’s Desk
14 Code of Ethics – A Conscience for the Company
5 The New Year By H. Stephen Bailey
On the Path to Accreditation 8 NCCA Application Readiness By Susan Cappa
Marketing Unplugged 12 Where Are the Customer’s Yachts? By Bryce Sanders
Consumer Focus 28 The Case of the Disappearing Pension By Peter D’Arruda
Features Stop Getting the Silent Treatment 10 By Paul Mallett
Investment Psychology 20 By Cliff Walsh
More Than Money Wealth Management: Beyond the Horizon: If You Could Only See What I See 23 By Roey Diefendorf
Too Busy To Grow Your Business?… Read This! (5-Minutes) 26 By Max Bolka
It’s Always Too Early To Give Up 33 By Bill Moore
International News 30 2016 Event and Educational Program Highlights
IARFC BOARD – Viewpoint 32 One Consultant’s Fiduciary Regulation is another Consultant’s Opportunity By James B. Moss
Departments 1 IARFC Domestic and International Directors
2 New IARFC Members 2 Events Calendar 4 From the Editor
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
The Register | January-February 2017
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From the EDITOR It’s hard to believe that we are in the first quarter of 2017. If you are starting the year with specific goals in mind, hopefully you make significant progress. Like most of us, you may be facing challenges. Don’t despair. The IARFC is working on providing you convenient benefits to make your year a success. Begin by taking advantage of the Competitive Group Insurance Life, AD&D and LTD offered to IARFC members and their staff by The Standard Life Insurance Planning Company. The highly affordable coverage enhances your recruiting package. A 30-day open enrolment is offered to new members of the IARFC, give plan administrator Michael Insurance Company a call at: 800.932.4075. Often over looked are our discounts and comprehensive partner programs that can save you money. Take time to check them out. (p. 34) We continue to build on Practice Management Tools. Today’s clients and prospects operate more effectively with a visual story of how the financial planning process evolves. Through PowerPoints and organizational tools, the IARFC supports both groups as they initiate and monitor the planning process. Finally, there is the Register, dedicated to providing practical information for your practice. In this issue, the Member Profile of Barry L. Dayley, RFC® relates his successful career built on a passionate commitment of serving others in both professional and personal pursuits (p. 14). Our column, “IARFC Board Viewpoint” taps into the experience of the IARFC Board who come together from different backgrounds, with different goals and expressing different opinions. The constant is their respect and dedication to serving the IARFC. (p. 32)
In the News Members In the News. Keep us informed on your recent accomplishments. Have you added staff, certifications, seminars, celebrated an anniversary in the business? Send a brief description and a print-quality photo when available to editor@iarfc.org.
“Coach” Pete D’Arruda, RFC®, Apex, NC Peter J. D’Arruda, RFC® Invited to Windsor Castle, London, for meeting with World Leaders D’Arruda, a visionary leader in education transformation will work with other leaders to provide recommendations to the Royal Family toward a peaceful and sustainable world. Apex, North Carolina, October 17, 2016 – a group of “change” leaders convened together for three days by an invitation from the College of St. George, Windsor Castle to work on a 2-page recommendation for the Royal Family and other world leaders. A similar workshop was formed at the Pontifical Academy of Sciences in Nov. 2015 resulting in a report for Pope Francis called “Children and Sustainable Development: A Challenge for Education” distributed to leaders throughout the world. The increased emphasis to design workshops leading to calls to action, has never been more critical. “The world is in peril in so many areas. A Shift in Consciousness is needed immediately if we are truly able to create a sustainable future.” Leaders were invited by Pete Ashby, Leadership Director, St. Georges House, Windsor Castle for the summit entitled, “Shifting Consciousness as Visionaries and World Leaders.” “As the world’s technology increases at exponential speed, so does misery inside of humans, causing social unrest at nearly every level and complexity. The demand for world leaders, vested in producing immediate outcomes is at an all-time high, if we are to produce a world we each want to live in.” Capital Financial Advisory Group, LLC, founded by Peter J. D’Arruda has a mission to transform financial education for everyone, child to adult.
Wendy M. Kennedy, Editor-in-Chief the Register
Page 4
Contact: “Coach” Pete D’Arruda 919.657.4201 pete@capitalfinancialUSA.com www.capitalfinancialUSA.com
The Register | January-February 2017
From the
Chairman’s Desk… “For last year’s words belong to last year’s language and next year’s words await another voice”… T.S. Eliot – American playwright & Literary Critic We start out the New Year at the IARFC motivated and changed. I experienced this transformation personally when I visited our new location the last quarter of 2016. My first impressions were a neat, clean and upbeat working environment situated in a more business-friendly location. The team has settled in and are tackling reorganization goals as we begin 2017. A reminder for the members — be sure that you send any correspondence to the new address on Summit Drive. My Chairman New Year’s Resolutions: Finish Accreditation and Increase Membership. I have been harping about Accreditation for quite a while. Our main goal is to finish the application and get it submitted in April. One major decision was to hire a “closer consultant” to take over application readiness. He is experienced with the NCCA culture, having been a reviewer of applications himself. This has been a huge undertaking with a potentially impressive payoff — there are only eight accredited entities listed through FINRA at the present time. We would be the ninth. We are on the right track and the end is in sight. You can read more about the accreditation status and our consultant in Susan Cappa’s column Path to Accreditation. (p. 8) After obtaining the NCCA blessing, the goal is to increase Association visibility and make it more relevant for both the consultant and the consumer. We started our Ethics Approved Program — an impressive imprint for consumers to feel more confident in the consultant they engage. In progress is a newly designed website where the public can find our members and know that they are dealing with accredited professionals. Sounds like lofty plans but they are reality-based. I don’t have to rally the IARFC team with all these undertakings. They work themselves. I have seen it personally as they The Register | January-February 2017
navigate the day-to-day business tasks while at the same time help the Board prepare for the future. This team works under long distance minimal supervision and with mega self-motivation — valued commodities in today’s workplace. Working the leadership component is the IARFC Board. Our annual in-person Board Meeting is scheduled for early March. My major goal is to make sure all Directors are on track to support the changes that the Association enacts. We have experienced, insightful professionals who can provide leadership and I intend to tap in to this resource. One of the Association fundamental documents is our By-Laws. The very core from which we operate is rooted in old ways of thinking. We need to take a fresh look at this set of corporate instructions and update them where needed. Turning towards the International front, we are looking to evaluate and strengthen the ties with the international chapters. What are they doing? How does an RFC® operate in a different culture? Where are we the same and where are we different? The foundation is solid, but care and nurturing of these oversees entities make us truly what we are – an International organization. I will be attempting to put together an offshore team to setup and coordinate these chapters under our umbrella. 2017 could be christened the “Year of the Fiduciary”. The DOL says that fiduciary responsibilities include: Duty of Loyalty, Duty of Prudence, Duty to Follow Plan Documents, Duty to Diversify and Duty to Pay Reasonable Plan Expenses Relative to Services Provided. How do you see your fiduciary responsibility? Many do not realize that this scrutiny is for retirement type programs only. Before, unless I had a signed document with some form of fee, I really did not have to worry about the advice I
rendered. Now I can be held accountable for anything that I say to a person. This can be added pressure to some. It can be very cumbersome regulations for smaller organizations. Let’s explore these attitudes and changes together. If you have comments and/or concerns regarding the new responsibilities coming later this year, sound off in an article to Wendy Kennedy, Register Editor. Or better yet, call me and voice your opinions. This is a perfect opportunity for IARFC members to network and figure out how to navigate an industry wide issue. So, my resolutions are defined and out there for the world to see. What say your voice for this upcoming year?
H. Stephen Bailey, CEBA, LUTCF, CEP®, RFC® H. Stephen Bailey, “Steve” Bailey, CEBA, LUTCF, CEP®, RFC® started HB Financial almost 30 years ago after already having a life insurance career. Steve is an elected member of the IARFC Board. He is also the 2010 recipient of the prestigious Loren Dunton Memorial Award. When not working with his clients you will find Steve on a golf course, spending time with his grandson or traveling with his wife, Bobbi. Contact: 704.563.6844 chairman@iarfc.org www.iarfc.org Page 5
Founder’s Award 2017
The IARFC Founder’s Award This Award is made in honor of the founder of the IARFC John J. Gargan. It is presented to persons who have delivered significant service to the operation and growth of the International Association of Registered Financial Consultants.
IARFC Founder’s Award 2017 Criteria for the Founder’s Award • M ust have been a past or present Board Director, Officer, or Committee Member. • Must hold or have held a professional designation awarded by the IARFC (i.e. RFC®). • Must have a clean regulatory record. • Must have been a member in good standing for a minimum of 5 years. • Must have high ethical and professional standards. • Must have contributed to the growth of the IARFC membership by referring membership, holding or attending events that additionally help expand (above and beyond) the visibility of the Association. Nominations Accepted From IARFC members: RFC®, RFA®, RFC® Retired, and/or General Members. Nominations Procedure Please fill out this form and on a separate sheet of paper please explain why the nominee should be considered for the Founder’s Award. Submissions are due by March 1, 2017
Nominee: Please print or type information below. ____________________________________________________________________ First Name Last Name ____________________________________________________________________ Firm or B/D ____________________________________________________________________ Street Address ____________________________________________________________________ City State Zip Code ������������������������������������������������������������������� Phone Email
Nominator: Please print or type information below. ____________________________________________________________________ First Name Last Name ������������������������������������������������������������������� Phone Email
Ways to send in a Nomination for the Founder’s Award
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
Mail this from to: IARFC Founder’s Award, P.O. Box 506, Middletown, OH 45042 Fax it to 513.345.9479 Founded in 1984, the IARFC serves, financial Nominate using the online form www.IARFC.org/FounderAward consultants to help their clients wisely “spend, save, invest, insure and plan for the future to achieve financial Questions: 800.532.9060 independence and peace of mind.”
On The Path to Accreditation NCCA Application Readiness
Catching members up on our Path To Accreditation, we continue to work on completing the necessary steps in order to be ready to submit the NCCA application for accreditation for our MRFC Certification Program. Each of the 24 NCCA Standards contains numerous Essential Elements which address the following general topics: • Purpose, Governance and Resources • Responsibilities to Stakeholders • Examination Development, Administration, Scoring and Analysis • M aintaining Certification, Quality Assurance and Maintaining Accreditation Our options were straightforward — we either do it ourselves or hire a consultant familiar with the NCCA processes leading up to accreditation. We would like to say that the IARFC team could finish the application but we are not experts in compliance with these standards and we would like to see the MRFC Certification Program approved without major revision and delays. To help us assess the MRFC Certification Program’s “readiness” regarding compliance to the NCCA Standards, we recently hired Ron Hanchar, MBA of Hanchar Consulting Services, LLC to review our content and provide suggestions on how we might best continue our journey towards NCCA accreditation approval. Ron has had the unique opportunity of working with a number of certification organizations applying for and obtaining third party accreditation through ISO 17024 and the NCCA. He also served as an elected commissioner and administrative reviewer for NCCA, reviewing dozens of application submitted by organizations such as ours. With over 20 years of experience in the management of certification and licensure programs, he has managed all aspects of Page 8
certification governance, program development, operations and maintenance. Ron understands the importance of working with stakeholders in developing and monitoring quality certification programs to assure that they are legally defensible and psychometrically sound. In the audit he conducted in late September of last year, Ron provided an analysis of the MRFC Certification Program in terms of compliance with each NCCA Accreditation Standard and Essential Element, based on the information provided by IARFC staff and available on the IARFC website. In addition, utilizing his unique perspective as both a submitter and a reviewer of NCCA applications, he was able to provide conclusions and subsequent recommendations addressing those activities related to the MRFC Certification Program that might not be in compliance with the NCCA Standards. After the initial audit, Ron was further contracted to help address these areas of concern and complete the NCCA application.
The plan going forward will be to complete and submit the application once it has been determined that compliance to the Standards has been met and the supporting documentation is in place. Too often organizations rush this process and submit with incomplete compliance to the Standards. The closer documentation is to meeting the Standards, the more likely the application will be approved by NCCA. When we get to the point where we feel comfortable that we have the appropriate documentation and are compliant with the Standards, Ron will fill out and complete the application. In crafting this application, it will be important to: • P rovide clear and concise explanations regarding compliance to the Standards along with having the appropriate documentation. • P rovide good, clear policies and procedures that can be referenced as documentation showing compliance. The Register | January-February 2017
Fulfilling the NCCA Standards (or Rules) Standards The MRFC must meet each of the 24 Standards and provide evidence of compliance through the required documentation. Essential Elements Accompanies each Standard and breaks down the specific requirements that the MRFC must do to fulfill requirements of the Standard. Commentary Accompanies each Essential Element. The Commentary sections clarify terms, includes examples of practices that help explain a Standard, or provides suggestions regarding evidence to demonstrate compliance.
MRFC Exam Fee
Things do not stop there. Once accreditation has been obtained, it must be maintained. It is a five year process. There is a constant monitoring of policies and procedures along with sending in annual reports.
FOR A LIMITED TIME, you can take the exam for $60.
As you can imagine, we are very excited to have Hanchar Consulting on board and are supporting him in whatever way possible. There is still information to be gathered and decisions to be made by the MRFC Certification Board so that Ron can properly do his job. But, it is steady progress with a realistic destination timeline.
• H ave a well-documented autonomous and impartial governance structure in place. • F or NCCA Standards 13 through 21, have solid, well documented examination development, scoring and analysis process in place. (Including the job task analysis, cut score study and technical reports). • H ave well defined security and exam administration policies and procedures in place. The Register | January-February 2017
Our targeted date is to submit the application by the April 2017 submission deadline. Once the application has been submitted, it usually takes 60-90 days for the NCCA to review and make a determination. If we get an approved application, we will be good to go. If not, we fix the problems and resubmit. Hopefully with experienced help, we will be successful the first go around.
Susan Cappa Susan Cappa is an editor and public relations coordinator for the IARFC. She is a graduate of the University of Cincinnati with a degree in Spanish. She brings over 20 years of experience in program coordination, 10 years in the medical book publishing field and 10 years of leadership skills as a PADI Scuba instructor. Her background includes writing, editing, event coordination, and leadership. Contact: 800.532.9060 susan@iarfc.org www.iarfc.org Page 9
Stop Getting the Silent Treatment You’ve done an amazing job locating and attracting quality prospects. You’re getting in front of more people than ever before. The business should be rolling in by now… but it’s not. Your marketing and prospecting plans appear to be working. So, why aren’t more of your prospects engaging with you, so you can start serving them as clients? Maybe it’s because… You haven’t given them a good enough reason to work with you. Maybe you haven’t done enough to differentiate yourself from other advisors in town. The message you’re delivering is the same they have heard from a dozen others just like you… or worse… the internet! You’ve made your message all about you, not them. As harsh as it sounds, your prospects don’t care about you. They only care about what you can do for them. They want to know you understand their issues and have the right solutions. They don’t trust you yet. There are two kinds of trust you must establish when engaging with clients: integrity and competence. They need to trust that you put their best interests before your own, and they need to trust that you know what you are doing. You’re making it too hard to do business with you. It could be that you allow too much time to pass before you call back. Maybe you prefer to meet in your office, but they would rather to meet in their home. All things considered equal, people like easy. We’ve come to expect it in this day and age. You’re confusing your prospects. You may be giving them too many options, so they experience paralysis by analysis. You need to be crystal clear with your message and recommendations. Eighty percent of responsibility in any communication falls on the sender, not the receiver. You don’t instill confidence. Your prospects want to deal with someone that is confident. Not arrogant, but confident. Former “Wolf of Wall Street” Page 10
“You can lead a horse to water, but you can’t make him drink.” — Proverb and current sales trainer Jordan Belfort says, “Prospects want to buy from someone who is sharp as a tack, enthusiastic as hell, and a force to be reckoned with.” Say what you want about Belfort, but I think he’s right about this one. You haven’t taught them something they didn’t already know. Whenever I meet with a prospect, I go in with a primary and secondary goal. Quite often, my secondary goal is to teach them at least one thing they didn’t already know. When I see the light bulb turn on, I take it to the house with… “You mean your current agent hasn’t shared that with you?” Take some time to reflect on all of these potential reasons for weak prospect engagement. If any of them hit a little close to home, face the music, make the necessary changes to your sales process and watch what happens. The good news is small changes can make a very big difference.
Paul Mallett, RFC® Paul Mallett, RFC®, is Senior Vice-President and Chief Operating Officer of Postema Marketing Group, a nationally-recognized independent marketing organization providing product support and business consulting services for independent advisors. Paul is a regular blogger and contributor to a variety of industry publications and social media platforms. Contact: 419.852.8817 pmallet1980@gmail.com The Register | January-February 2017
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Marketing Unplugged Where Are the Customer’s Yachts? Ethics from the Client’s Point of View accountant or lawyer. She sold shoes previously, changed jobs, went through training and presto, she’s an expert! • No Attention – They fear the advisor invested lots of time and attention to get them to hand over their money. Once it’s invested, the fee revenue is booked. Now the advisor is looking for their next big score. No one is watching their stuff. • Confidentiality – Revealing your financial details is like getting undressed in front of someone else. We worry about the details they will share. • They Don’t Identify – If you work with a financial advisor, you want them to be successful. The advisor should not appear richer than the client. It’s “Where are the customer’s yachts?” all over again. Sending the Right Signals “Where Are the Customer’s Yachts?” Seventy-five years ago, this book was written by Fred Schwed. (1) According to legend, after being shown around a harbor and told which large vessels belonged to various bankers and brokers, the fellow asked, ”Where are the customer’s yachts?” The perception that the financial service industry makes money at the expense of the investing public continues. Stockbrokers score 13% in the public perception of their ethics and honesty. (2) There’s good news too. In politics, many Americans have a negative opinion of Congress. According to Gallup, in September 2016, 76% of Americans disapprove of the way Congress handled its job. However, many Americans love their own congressional representative! Americans might dislike the industry, but if they have a good, ethical financial consultant, they can be very loyal. What Do Clients, Prospects and the Public Think? The media, television and movies often portray “brokers” in a bad light. Many people share these opinions. Page 12
• Brokerage Firms Consider Themselves First – The dot com crash revealed research analysts privately disparaged the stocks they followed while producing glowing recommendations for the public. Investors assume this was to win M&A and new issue business. • Consider Yourself First – The public sees the business as transactional. The firm doesn’t make much money from buy and hold clients. “Brokers” need to get clients actively trading to ring the cash register. You are a friendly croupier in the casino that is Wall Street. • Front Running – Consultants get information first. They use it to profit themselves, then get around to passing it on to clients. Or not. • Fear of Losing Control – When you take someone else’s advice, you are putting your life in their hands. If something goes seriously wrong or the market falls off a cliff, they will sidestep all responsibility. • Lack of Knowledge, Experience – My “broker” didn’t go to school like an
Wow! That paints a very negative picture! The story about the public’s perception of ethics in the industry is also a story about how the client perceives the value you bring to the relationship. Here are eight ways you can demonstrate high ethics in ongoing client relationships. 1. Confidentiality – Perhaps you told them up front that your lips are sealed. They need reminding. Strategy: “We’ve had a good year. Logically you might think I would want to tell others, even brag about it. I can’t do that because I’m bound by the rules of confidentiality. I cannot tell anyone that you are my client. You are not bound by the same rules. If you are happy with your results, you can tell as many people as you like. I would even encourage you to do so.” 2. Pricing – They understand professionals deserve to be paid. They don’t work for free. Neither should you. They want to know how much they are paying. Strategy: “You need to understand how we make money…” Explain buying products The Register | January-February 2017
with built in fees as similar to a supermarket buying milk wholesale and selling it retail. Explain those fees as “If you sold tomorrow…” Explain commissions as similar to paying sales tax when you buy an item in the store. 3. Accountability – They worry about loss of control. They need to know you are paying attention. They like accountability, because they can hold you to task. Strategy: “If you become my client, you should get a report card. If I’m doing a lousy job, you should be able to fire me.” Periodic portfolio reviews are the “report cards”. You have the tools to assemble an appropriate index that aligns with their asset allocation, so you are comparing apples to apples. 4. Knowledge, Experience – Talking about the combined experience of your team is a good strategy. Although you might consider it a chore to spend time out of the office completing continuing education requirements, position it as a client benefit. Strategy: “Apologies for missing your call. I was out of the office attending a course. I’m in the process of studying for an additional professional certification.” They might even ask questions! 5. Meaningful Contacts – Nothing says “I’m putting your interests first” like regular calls that are relevant to their situation. Although questions about the family personalize a call, you need a strong business component. Strategy: They own a stock. A news story just broke. Call the client as early as you dare. “Good morning! I’m pretty sure you must have seen the article about Antarctic Oil in today’s paper, but I’m calling to be sure. It’s good news. They’ve brought that big find online at last. We bought early figuring this would eventually happen. The good news should be a benefit for the stock.” 6. Taking Credit – Clients might like you, but they wonder how that big firm with thousands of employees actually benefits them. Aren’t they just overhead? Show them how that faceless organization actually works for them. Let’s assume they needed certain documentation to complete their tax return. They needed it in a hurry. Strategy: “Boris, I wanted to let you know that problem is solved and the papers are in your accountant’s hands. After you called, my assistant Esmerelda contacted our records office in Omaha. They faxed the documents to us. We overnighted them to your CPA and called her to confirm receipt. I’m glad we were able to help.” The Register | January-February 2017
7. Identify with Them – People who pay for a service expect the provider to dress professionally. However, don’t flaunt your wealth in other ways. Yes, your house might be on the cover of a design magazine. Maybe you just came back from a 14 day cruise on the SS Conspicuous Consumption. Don’t brag. Strategy: “Vacation? I’m usually in the office after Christmas. I need to be available for clients who need things done before the end of the year. We will probably try to get away for a week in January when the kids are out of school on winter break.” 8. Recommended Publications, Websites – They work 9:00–5:00. They assume you switch off when you leave the office. Build a list of public access websites and publications from reputable sources you follow. Write your clients a letter explaining how you keep on top of news that’s important to them. Share those resources. Strategy: “As a professional, I need to stay on top of news and developments in the financial markets. I find these websites and publications very helpful. I thought you might want to check them out too.” Include your own firm’s website for online access to research and account information. What Have You Done? By being transparent and attentive, you have shown you put your client’s interests first. They might still have mixed feelings about the industry, but they will likely love their consultant.
IARFC’s CAREER CENTER at
careers.iarfc.org JOB SEEKERS, YOUR NEXT Financial Planning CAREER OPPORTUNITY COULD BE CLOSER THAN YOU THINK.
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The Register | January-February 2017
Code of Ethics A Conscience for the Company
Barry L. Dayley, CFP速, RFC速 When a person is successful in their career, they look at their achievements with pride of accomplishment. When they love what they do, their work ethic becomes a more passionate commitment of serving others in both professional and personal pursuits. This month, the Register cover focuses on Barry L. Dayley, CFP速, RFC速 of Money Concepts from Afton, WY. Barry has worked in the financial planning and wealth management business since 1981 when he started his own Money Concepts Financial Planning Center in Las Vegas, Nevada. In 1985 he received a request from Jack Walsh, the founder of Money Concepts, to serve as a consultant for Money Concepts and CUNA Mutual to develop a financial planning program for credit unions nationwide. In this role, Barry helped lead the establishment of over 600 financial planning programs in credit unions across the United States. Later, Barry accepted a position as the Division Manager of Member Services, where he led the operations of CUNA Mutual Group in the Northwest Marketing Division. In 1998, he returned to Money Concepts as a Senior Vice President with emphasis on financial institution development. Currently Barry is the Executive Vice President of Money Concepts with national and international responsibilities.
Register: Your CV lists many leadership roles with financial institutions. How did these opportunities present themselves? Do you consider yourself a person of fortunate circumstances or one who carves out their own path? Barry: In many ways my professional career paralleled the coming of age of the financial planning industry in the United States. Early on I was exposed to the power of financial planning and how it could enhance performance and the experience for The Register | January-February 2017
customers or members of financial institutions where annuity and mutual fund sales platforms were springing up. With this commitment to the financial planning process, opportunities presented themselves in the form of banks, credit unions, and insurance companies that desired to offer full financial planning services, but did not know where to turn for leadership on how to offer these services in a financial institution setting. These opportunities positioned me to carve out a unique career path to help financial Page 15
institutions pioneer and implement these powerful services. In every role I have filled on the local, regional or national stage, my focus was to offer, or train others to offer, holistic financial planning services. Register: As Executive Vice President of Money Concepts, you have national and international responsibilities. Can you elaborate on the international? Barry: As an officer of Money Concepts International, Inc., my office is in Palm Beach Gardens, Florida though I live in Star Valley, Wyoming. My responsibilities have me extensively traveling around the United States. As a firm, our primary focus is to develop business relationships and opportunities in the United States primarily. However, over the years I have conducted
training and met with financial consultants in New Zealand, Canada, and Hong Kong. We have also met with several banks in Macau who have expressed interest in offering financial planning services through Money Concepts Asia, Ltd. In addition we have had working relationship with the largest financial institutions in Guam. Register: With this long history of professional service to both consultants and consumers, your perspective of ethic behavior is as relevant today as it was over 30 years ago when you entered financial services. The integrity and trust between a financial consultant and their Client is the true barometer of the longevity of the relationship. When first starting your career, did you grasp the importance of ethical behavior and has it
changed for you over your many years in practice? Barry: While I was a student at Brigham Young University majoring in financial and estate planning, I had the good fortune of knowing Jack Walsh, the founder of Money Concepts. Jack was kind enough to put me on his personal mailing list, ensuring that I received his monthly newsletter, Money Talk. At the time I thought Jack was just being kind, and he was; however, he was always recruiting. One of the issues of Money Talk was a description of the corporate philosophy of his new company, Money Concepts International, Inc. In this newsletter, Jack elaborated five key points including; Integrity, Commitment, Fairness, Credibility, and Opportunity. In essence, this was a code of ethics, a conscience for the
Barry, Allen Porter and Susan Walsh; preparing to present awards at the most recent Awards Banquet at the 2016 Money Concepts Financial Planning Congress in Nashville, Tennessee Page 16
The Register | January-February 2017
company. When I started with Money Concepts, we were expected to quote this corporate philosophy from memory in all first meetings with clients and prospects. By doing so, this philosophy, introduced in the formative stages of my career, became ingrained in who I was becoming and how to treat others professionally. Quality and enduring organizations still provide this kind of training and expectation today. In a volatile economy, with creative and confusing products, personal commitment to ethical behavior is more important than ever. Putting the best interest of the client first, and treating others with integrity is the hallmark of a true financial planning professional. It cannot be forced through regulation in spite of Department of Labor fiduciary rules. I encourage every RFC® registrant to memorize the five-point code of ethics of the IARFC. It will be a clarion guide to maintaining long-term relationships with clients, employees and associates. Register: What is the main obstacle that financial consultants have to overcome in building that trust relationship with clients? Barry: Far too many financial consultants are more interested in learning just enough about a client to find assets to gather or sell an annuity or insurance policy. Their focus is not helping the client achieve their objectives; rather it is on the commission or fee that can be earned from the sale. Recently I read a study by Cerulli Associates, Inc.1 where they determined that only 27% of financial consultants conduct client interviews, statement reviews, and record reviews when fact finding. I was startled to see that 73% are not doing the basics that should be done to provide credible financial planning advice. In my opinion this is the main obstacle to building a trust relationship with clients. They don’t think you care about them. Register: Put yourself in the role of Mr. and Mrs. Consumer. What are they looking for in a financial consultant? Barry: The consumer is looking for advice they can trust. They want to work with a financial consultant that has the knowledge, experience, and skills to help them achieve their personal objectives; one that truly cares about them. Time in the business has taught me that people want to know what to do financially, not just be sold a product. If advice is provided in the context of a The Register | January-February 2017
Barry presents awards to top financial consultants in Nashville
financial plan, it will establish the foundation of a trust relationship. As a result, the financial consultant will actually sell a broader array of products because the client will understand how the product can help them achieve their personal objectives. In addition, the consumer will see the consultant as putting their interest first. Register: The IARFC has initiated an Ethics Approval Program designed to promote adherence to their Code of Ethics. How can members utilize this in marketing to prospects? Barry: In light of the new Department of Labor (DOL) fiduciary rules, the timing is ripe for communication to your prospects and clients regarding the standards of excellence that you follow. The new Ethics Approval Program will help members (that qualify), show their clients that a third party organization, IARFC, has verified, through an extensive vetting process, that you not only agree to, but actually follow the five points of the IARFC Code of Ethics. The new blue and gold “Ethics Approved” seal will help clients easily see that you measure up when it comes to what is important in a financial planning relationship. From the financial consultants perspective, here is yet another reason not only to operate in an ethical way, but also to qualify for an RFC® designation and align themselves with some of the top financial consultants in the industry. Register: You were recently voted onto the Master Registered Financial
Consultant (MRFC) Certification Board. How do you think your experience will be helpful to the Board as it applies for accreditation? Barry: As a new certification, it would appear that the MRFC is up against a great deal of competition. However, upon closer examination, the MRFC is different in that it is part of the larger IARFC organization, and allows for a broader base of participation. My 37 years of experience in the financial planning industry, coupled with ongoing training and management responsibilities, has given me insights and understanding of what one must do to achieve credibility and success in working with clients. I will apply my effort, networking connections, marketing know how, and leadership ability, to help develop the MRFC into a recognized and respected credential by both financial professionals and the public. Register: Why is it important for members to seek the MRFC? Barry: Broad based high-level continuing education is the hallmark of a financial planning professional. It builds confidence, opens opportunities, and enhances business performance. At the same time, it exhibits to the public that you care enough about your profession to continue personal education. The MRFC is the kind of program that will help you be prepared to work with a client just getting started, to very complex and challenging high net worth clients. The MRFC is not only a professional Page 17
mark of quality, it also allows more options than most other certification programs to meet its strict experience, educational, and licensing requirements. Register: As a trainer/educator, what are the most requested continuing education topics for financial consultants? What are your favorite ones to present? Barry: Surprisingly my favorite topics are also the ones most requested. These include aspects of the financial planning process such as, the financial planning cycle, discovery process, case analysis, presenting the plan, monitoring the plan, managing client expectations, and achieving a good return on your invested time. Other common courses include sessions on life insurance, annuities, mutual funds, ETF and variable annuity analysis. Frequently I am called upon to speak or conduct training at national banking and credit union conferences. My work with financial institutions also requires that we provide training for executives and staff on how to operate a successful financial planning program in a financial institution. Register: Next year the Industry will be facing regulations regarding their fiduciary responsibilities. Can you weigh in on how you see this changing the role of the financial consultant? Barry: The soon to be enacted regulations regarding the DOL will be phased in over 2017 with full compliance required by January 2018. These regulations no doubt will affect every financial consultant with higher expenses and substantial time to establish policies and procedures, preparation and processing of Best Interest Contract Exemption (BICE) documents, and compliance with the new regulation in general. In addition, costs will increase to maintain compliance, and financial consultant compensation may be reduced for some lines of products as product manufacturers reduce loads, and internal expense ratios. As clients and the general public learn more about the DOL fiduciary rules, they will expect more transparency in the relationship, and that their best interest will be represented. Liability will increase for financial consultants with the possibility that a class action suit could be brought against them if the client’s best interest is not represented. That being said, for most Page 18
Barry presented Managing Client Expectations, at the 2016 IARFC National Financial Plan Competition in Charlotte, NC
financial consultants offering holistic financial planning services, life will go on as usual with the exception of the new BICE agreement paperwork and procedures. They have always had the client’s best interest in mind when making recommendations and the new regulations will not change that. However, for financial consultants who play more of a product sales role, especially if they represent only one company or have access to limited product selection, they may find compliance difficult, if not impossible. Register: For over 30 years, you have been involved with the Boy Scouts of America. How has the organization evolved over the years and how do you see it preparing boys for living life as they grow older? Barry: The Boy Scouts of America was founded on core principles that remain in place today. They include their Scout Oath — “On my honor I will do my best, to do my duty to God and my country and to obey the scout law, to help other people at all times. To keep myself physically strong, mentally awake and morally straight, motto — “Be Prepared”, and slogan — “Do A Good Turn Daily.” Over the years their advancement programs have changed somewhat to reflect the interests and needs of the times. However, the core continues to have a “leave no trace” focus on outdoor high adventure experiences. The natural world is an excellent classroom to build character and assist young men in America
to successfully navigate the challenges of adolescence and be better prepared for a successful adult life. Register: Lastly, as your own personal legacy to your children and grandchildren, what do you hope they understand most about “Father and Grandpa” Dayley? Barry: Bree and I have five children and at present five grandchildren. This is a very exciting time for us as we interact with the children of our children. Each one of them is a talented and amazing individual facing a future filled with challenges and opportunities. We view these young people as great hope for the future of our family and the part of the world they live in. First, I would hope they understand that I have always tried to treat others as I would want to be treated. Second, that your integrity is one of your most important assets. Third, as important as it is to have the financial success needed to support your family, regardless of their career choice, life is more about making a difference than making a living. Last, happiness only comes from doing what is right. Contact: 561.472.2000 barry@moneyconcepts.com www.moneyconcepts.com 1 Financial Planning: The Delivery of Advice and Guidance, Cerulli Associates, Inc.
The Register | January-February 2017
EDUCATION • EXPERIENCE • INTEGRITY
RFC® ® R FA
Life Insurance License FULFILLS Education Requirement
The Registered Financial Consultant – RFC® Designation Registered Financial Associate – RFA® Designation are testaments to education, experience and integrity. In a world of constant economic, political, and social change, consumers engage the guidance of financial consultants to achieve financial security and independence. An RFC® or RFA® designation sets you above your peers as a qualified and trained professional that meets a high level of competency.
RFC®
RFA®
Experience
Experience
Education 1 of the following
Education 1 of the following
Examination
Examination
4 years of experience as a full-time practitioner in the field of financial services.
Bachelor’s or advanced degree in a related field Designation in financial services Securities license; Series 65 or combinations Life Insurance license
A proctored exam (MRFC only).
Licensing
Granted to recent graduates of an approved academic curriculum in financial services.
Bachelor’s or advanced degree in a related field Designation in financial services Securities license; Series 65 or combinations Life Insurance license
A proctored exam (MRFC only).
Licensing
Required licenses necessary for mode of practice.
Required licenses necessary for mode of practice.
Conduct
Conduct
Ethics
Ethics
Sound record of business integrity.
Adherence to IARFC Code of Ethics.
Sound record of business integrity.
Adherence to IARFC Code of Ethics.
Grow with US! Apply Today! Enhancing the professional skills of our members is an important part of IARFC strategic plan. The IARFC Ethics Approved Programs is designed to promote adherence to our Code of Ethics. This program scrutinizes the practice history of each member and will award recognition to those who serve the public’s interest when dealing with their financial future. Contact the IARFC for an application and a detailed listing of requirements.
International Association of Registered Financial Consultants 800.532.9060 • info@IARFC.org • www.IARFC.org
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
Investment Psychology Some of the prominent investment psychology challenges that investors face are simple in theory and you may “know” them, but keep an open mind, take a step back and think about whether or not you are consistently implementing them. Why can’t more investors buy low and sell high? Stocks are the only asset that the average person wants more of when prices are high than when they are low. Why do people treat stocks differently than buying a car or a pair of pants at the mall? A possible explanation resides within a combination of factors: mental error on the part of the investor and fear. Recently extrapolated results (good or bad) carry an expectation that they will continue infinitum. When stock prices decline, the macro or fundamental conditions at the time are likely to be cloudy and sometimes downright scary. The average investor expects the trend to continue and is afraid to lose more money. Instead of pulling the trigger to buy more stock at the lower price for the longer term, the result is often an emotional decision to sell, which is the exact opposite of the desired response. If the rationale for the original purchase was shaky to begin with, the situation may be further exacerbated.
In the summer of 2016, the U.S. stock market did what it often does: the opposite of what the majority expected. Following Great Britain’s vote to exit the European Union, many market participants expected significant volatility during what is typically a seasonally-weak period for stock market returns. Instead, the market marched higher in the tightest trading range in at least one hundred years, tallying forty trading sessions without closing up or down more than 0.5%, compared to the previous day. Since then, though, there has been a resurgence of volatility. As a value investor with the ability to go against the grain, I typically view volatility as opportunity. But that’s not the case for everyone. I thought it would be interesting to discuss some key Page 20
psychological and behavioral barriers to investing profitably during periods of high uncertainty. There are many different ways to make money, but those who have been very successful had one thing in common…they were masters of psychology. Not only their own psychology, but mass psychology. It is the understanding of both that allows the greats to exploit the weaknesses of inferior traders and main street investors. They have the ability to control their emotions and make rational decisions or create trading systems to remove these factors from the process. According to financial textbooks, this is how all investment decisions are made, but in practice this is not always true.
When stock prices are rising and valuations are high, the opposite happens. Investors incorrectly believe that the sky is the limit and buy more based on the fear of missing out on potential profits. It is understandable that professionals are afraid to underperform the indices and competitors, which could lead to losing clients. However, investment professionals make the same emotional decisions as individual investors, but they have more pressure riding on each one of those decisions. Few consultants and institutional investors will sell at a market top, in part because tops are difficult to call. In fact, it’s easier to go along with the crowd mentality to explain away poor performance especially if everyone gets caught in the same bear market, rather than miss out on riding the wave for that last five-to-ten percent rally. It begs the question as to what can be done to avoid these issues. First, if you are making forecasts, be aware of recency bias, which can cause you to erroneously put too much The Register | January-February 2017
weight on the most recent news and trends, as well as overlook long-term risks and trends. Be careful when forecasting: All trends end and reverse — hockey stick projections rarely come to fruition. Study market tops and bottoms and those of individual stocks you know well. Identify whether or not the news was positive or negative. Understand what analysts’ future expectations were at the time as well as the actual outcome. Additionally, change your focus and that of your clients. Every investor has unique needs. Some have the time frame and risk tolerance to be fully invested in the equity markets, but most don’t. The best path to take is to focus on meeting financial goals within defined risk tolerances rather than beating an arbitrary index that is likely well outside of your client’s risk tolerance. Continual client communication around this focus is paramount so you can avoid dreaded conversations about why the S&P was up 12 percent and they were only up 7 percent. The further away you get from the last bear market, the more this will need to be reinforced. Why do investors follow the herd? Most investors and people, in general, follow the herd. We are social animals who are dependent on others for survival. We learn through our parents, families, friends, communities and society at large. Most people don’t like to be different; they want to fit in. Many are unable to embrace their individuality and, in many cases, care too much about what others think and are conditioned to conform to family or societal norms. From personal experience, it is difficult taking a contrarian stance particularly when the expectation is for the market to decline. The two most common responses to this are amusement and pity. How you react depends on the confidence in your research and how much you care (or don’t) about what other people think. Ego can easily get in the way and chide you into believing you are wrong when the “experts” think something different. Standing outside the herd can often lead to second guessing yourself and being second guessed by clients. For many, it may be easier to accept someone else’s view than to do the homework to formulate a unique point of view particularly if there is a lack of confidence in their ability. It constantly amazes me how easily and quickly people will accept and spread information without ever checking its validity or taking time to think about it in a rational way. Just The Register | January-February 2017
look to social media or reality shows as prime examples. How does one effectively stand outside the herd? For a start, don’t listen to the so-called experts in the news and media. While news and media outlets host very smart and successful guests, the objective is not necessarily to help your business and your clients to be profitable. Often the focus is on short-term trends and concepts or to make money for themselves and their clients. Don’t listen to the “experts” at the bulgebracket investment banks either. Brokerage firms and the analysts who represent them get paid based on trading volume. They sell optimism and short-term trading ideas, which are essentially emotional judgements and suppositions that can cloud rational investment decisions. When it comes to investing, optimism and hope are not sound investment principles. Analysts are useful in helping us to understand what the consensus view is and to gather interesting information and details. The reality is that the number of mainstream market pundits who have actually been successful in predicting market tops and bottoms is close to nil. Focus on long-term trends and resist the need to be invested at all times. If the goal is to outperform the markets over the long term, there will be times when you need to go against crowd mentality. The media constantly pounds at us that if you are not fully invested all the time, you could easily miss out on the best days, which provide all of the year’s returns, once again playing on the fear of missing out. Conversely what is not mentioned is missing out on the worst days. The higher the market valuation, the lower expectations should be for long-term returns. Regardless of what the market does in the short term and how many of the best days you miss, there are times when the long-term risk/reward does not warrant being invested in the market. Why do investors make decisions that are not congruent with their investment time horizon? Many investors with a long-term investment time horizon unfortunately make ridiculously short-sighted investment decisions. Some of the reasons have already been touched upon: fear, hope and recency bias. I’d like to introduce a few additional insights. Advances in technology has given us many wonderful tools and has leveled the playing field for individual investors. That being said, those advances lend themselves to ‘ticker-itis’, which is a constant streaming of quotes or information that not only leads
to indecision and excessive trading, but also distracts from focusing on value-added tasks and long-term goals. Make a conscious decision to avoid constantly checking market information; instead, set a calendar alert for a specific time to check the market. In this way, you remain informed and not sidetracked by the overwhelming stream of data. It’s human nature to have an emotional tie to money. Mike Tyson once said, “Everybody has a plan until they get punched in the mouth.” Taking a hit on a stock that blows up or riding down a broad market decline often feels a lot like a punch from Iron Mike himself. The fear of losing more money kicks in and you panic sell. The long-term, rational, well-thought-out financial plan is down for the count because the fear instinct kicked into high gear. Greed also has its cost. As an example, a stock on the broader market surpasses all expectations and the only thing driving it higher today is the fact that it was up yesterday. However, when the rationale for investing in the stock no longer exists, it is time to make an exit. Most people don’t behave this way. The brain receives a huge shot of rewarding dopamine that feeds on itself wanting more so the greed stops the sell and the stock eventually has a downturn. Hope can be just as damaging as fear or greed. Hope in investing is wishing to get back to even after a stock turns down or expecting hockey-stick fundamentals, stock prices or positioning your investments for such an occurrence because this is what you want to happen. There is a disconnect when what you are hoping for is not a likely outcome. The risk associated is too high or not appropriate. Being bullish just because you want to make money is not the best strategy. As is often the case, the reality is the investor doesn’t realize that they’re behaving in this way. The question becomes, how does one stay on the long-term investing path? You must take the Zen approach and truly know yourself. Of key importance is maintaining a trade journal that details the reasons behind each of your investment decisions. Recording each transaction can often deter impulsive actions. Keep your long-term goals handy for reference. If the transaction doesn’t meet the long-term goal criteria, take your finger off the button. Remember, too, that pride goes before the fall. Be mindful not to let ego get the better of you. It is very easy to become overconfident, which may lead to careless error or risky Page 21
Explaining the Financial Planning Process A well mapped informational flow for a successful and lasting relationship between You and Your Clients/Prospects. All financial consultants use a planning process. But what does that mean to the consumer?
behavior. If an error is made, accept it, learn from it and move on. Evaluate all investment opportunities on their own merit with respect to how they may help you and/or your clients. Assess the portfolio as if yesterday’s closing price is your purchase price and ask the following questions: 1. Based on yesterday’s closing price, would you still choose to own the portfolio? 2. Are you holding on to the portfolio so that you can get back to even? Identify and document your strategy and process. As a financial consultant, it’s paramount to know when and why you buy or sell. My general rule of thumb is that if any stock or investment is down more than 10 percent relative to its sector or peer group, it gets reassessed. Be objective in your interpretation of new information and check your hypotheses consistently, as there is a propensity to view new data as a confirmation of prior beliefs. Whatever the parameters are, adhering to your well thought out disciplined process will go a long way toward minimizing knee-jerk activity.
The IARFC has a new trifold brochure The Financial Planning Process product number (SG107) that clarifies expectations and sets a roadmap to financial success. It is directed to the consumer, written in an easy-to-understand, organized manner. The brochure defines: • Why use a process • The benefits • The steps to follow • The financial areas it addresses
Focus on what you can control and let the rest go. Acknowledge that the market will do what the market will do and rely on your circle of competence, research and especially your decision-making process to propel you forward. In doing so, you may effectively resist the herd mentality elevating you and your practice to better serve the individual needs of your clients.
The information is adaptable to any practice. It is generic, yet specific enough to guide the consumer through the essence of Financial Planning.
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
Cliff Walsh, CFA, RFC®
Order your IARFC brochures at: www.IARFC.org/Store or call 800.532.9060, info@iarfc.org
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Cliff Walsh, CFA, RFC®, is the Chief Executive Officer and Chief Investment Officer of Progressive Advisory Solutions®, a SEC-registered investment advisory firm, that provides investment and practice management services to financial advisors, family offices, and endowments. Contact: 631.648.1670 cwalsh@progressiveadvisorysolutions.com The Register | January-February 2017
More Than Money Wealth Management Beyond the Horizon: If You Could Only See What I See
In the mid 60’s, the post WWII industrial growth was in full swing. Steel was the core element for all construction (airplanes, cars, buildings). But there was a young research scientist named Russell “Judd” Diefendorf who was developing new materials that were revolutionary. One such item was a carbon/boron composite that was stronger than steel and much lighter. Imagine the uses of such a product? Lighter planes and cars would mean better fuel efficiency and longer travel capabilities. However, when Diefendorf introduced this product, venture capitalists quickly discredited this new and The Register | January-February 2017
unproven resource. My Uncle Judd, left the known shores to discover a whole new world of “what could be.” You may recognize at least one of his patents, the cubic zirconia. He is also responsible for creating the composite used in the nose cone construction of every rocket that has gone into outer space. It is now used on the shell of the Boing 787 Dreamliner as well. So the traditional ways of constructing our cars and planes won out over my uncle’s proposed way for the future. But there were those who were listening; those who were
willing to adapt and accept a new way of doing things. Originally, these were not U.S. companies but foreign companies. Created yet rejected in the U.S., but accepted and manufactured in Japan. You know the story of how the fuel efficient Japanese cars quickly dominated the global automotive industry. All because either the status quo manufacturers could not or did not want to see what my Uncle Judd could see. So here I am, a product of the financial planning, estate planning industry. Wills, trusts, insurance — lawyers, accountants, Page 23
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
Member-Refer-A-Member Enhance the Designation The value of your own RFC® designation continues to grow by increasing members of highly qualified consultants using and displaying the RFC®.
An Ongoing Opportunity The IARFC is looking to enrich the careers of your professional peers with the same membership benefits you enjoy. By referring potential IARFC members, you offer them an opportunity to tap into the premier network of members who share best practices, strategies to help grow businesses and techniques for better practice management.
Referring a member is easy! Take a few minutes to grow our network of the Registered Financial Consultants. Fill out the Referral form by going to: www.IARFC.org/ReferMember Call: 800.532.9060 Email: info@iarfc.org
Details go to: www.IARFC.org/ReferMember IARFC Attn: Membership Services P.O. Box 506 Middletown, OH 45042 USA P: 800.532.9060 E: info@IARFC.org W: www.IARFC.org
Fax to: 513.345.9479 Email to: info@IARFC.org
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brokers; A set of “rules”, a set of disciplines, born from our educational institutions, telling us how to “do it.” Yes, I learned the rules, followed the disciplines, and traveled down this well-worn road. And what have I discovered? There is a new way of helping clients and families do their financial and estate planning! There are new “composite materials” that will lead to radically different results; stronger and lighter consulting, with better fuel efficiency. It has been 50 years since Uncle Judd introduced his new composites to the world. What seemed so radical and revolutionary then is now commonplace and part of our everyday lives. So allow me to introduce to you some novel concepts that are NOW: • Values Based Planning • Purposeful Trusts • 3 Dimensional (personal, financial & social) Wealth
Dakota trust company, with purposeful trust provisions) to operate in a whole new atmosphere. I like to think of it as the SCUBA gear that allows a diver to operate below the surface of the water. Some professional advisors may have a snorkel or try holding their breath for a while but ultimately will surface without the right equipment. I have prepared a series of articles for the Register that will expand upon this theme of “more than money” wealth management, so you might begin to appreciate what is on the horizon. The future IS bright for the consultant that utilizes the new tools that now exist. I promise you that our work as professionals will become more meaningful as we lead our clients from financial success to personal significance. Personal, financial and social wealth will be the assets that we must preserve and protect to grow healthy families. I see it. Can you?
These are all examples of “More Than Money” Wealth Management. These are radical planning concepts to the traditional accountant, attorney or financial consultant. And what I have found is that 100% of these professionals are very polite when I speak about “total” wealth consulting, however, when I leave their offices, it’s business as usual — text book documents, traditional financial solutions — which in my experience leads to less than fulfilling results, if not total failure. Passing on valuables without values can lead to problems that can persist for generations.
Monroe “Roey” Diefendorf, Jr. CLU, ChFC, CFP®, CIMA, CAP, RFC®
Having traveled towards the horizon over my 46 years in business, what I now see is a whole new horizon. And for those who are still on the shore, I wish you could see what I see. I see a different consultant who is able and willing to embrace the ground breaking work of values based, purposeful, and 3 Dimensional Wealth™ (More Than Money) planning as a core competency for their consulting practices.
Monroe “Roey” Diefendorf, Jr. CLU, ChFC, CFP®, CIMA, CAP, RFC® active since 1970, Roey is the 4th generation of his family in the business. He has authored over a dozen books, including “3 Dimensional Wealth: A Radically Sane Perspective On Wealth Management” (2005) and “A Better Way: Using Purposeful Trusts to Preserve Values & Valuables in Perpetuity” (2014).
My Uncle Judd was right. There was a better way. There was a way that would extinguish dinosaurs and create new industry giants. But beware or history WILL repeat itself. Believe me when I tell you there is a price tag for being a pioneer. Diefendorf Capital, a family of financial service companies, (now 3 Dimensional Wealth Advisory) has amassed the components (our own broker/dealer independence, our own RIA for objective investment advice, and our own South
Roey, in conjunction with Shawn Barberis, JD, has introduced “A+ Life Family Pentagon” a technology tool to deliver “more than money” wealth management. This platform is the nuts & bolts that make 3 Dimensional Wealth consulting transformational for clients who wish to become “legacy” families. Contact: 516.759.3900 roey@3dwealthadvisory.com ww.3dwealthadvisory.com The Register | January-February 2017
The Register | January-February 2016
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Too Busy To Grow Your Business?… Read This! (5-Minutes)
Not enough clients and not enough time are the reasons most often cited when consultants are asked, “What are the biggest obstacles to growing your business?” But that’s like saying lack of money is the cause of why someone is broke. It’s not the cause, it’s the effect. Similarly, a lack of good clients and lack of time are symptoms of, and not the causes of, many business development challenges. Don’t “Dabble” When it comes to marketing, the truth is that many consultants can’t (or won’t) do what it takes to create and execute a well-organized marketing plan. They don’t know how, are not really interested, or just don’t have the time. They’re already swamped with day-to-day activities. Add in the new DOL’s regulations, and many consultants are barely treading water. Frustration level is at an all-time high. As a result, many consultants simply “dabble” in marketing. They just throw Page 26
some money at it here and there. Worse, they may even be subconsciously sabotaging their well-meaning marketing efforts. After all, the more you market, the more clients you’ll get. And because you’re already overloaded, that just means more work. If you’re already drowning, this reasoning may account for why so many consultants shy away from real meaningful marketing efforts. The most successful consultants, however, have mastered the art of marketing. Your plan doesn’t have to be elaborate, and it definitely doesn’t have to cost much, if anything. But if you want to grow your business, you have to market consistently, and that means you must make the time. But first, let’s look at the excuse of not having enough time. The Myth of Waiting Until You’re Caught Up “What have you been doing the last two weeks?” I’ll ask consultants. “Getting caught
up,” they answer. “Lots of service work, but I’m almost there.” Service Work Can Often Be Used As A Convenient Excuse For Avoiding The Marketing You Can’t Or Don’t Want To Do. When was the last time you (or anyone else you know for that matter) were caught up? You’ll never be caught up, and you shouldn’t be; not if you’re continually growing your business. And if you do somehow magically get caught up, it probably won’t be for long. Making The Time One of the greatest rewards of being a consultant comes from having the freedom to create your own schedule, to run your business the way you want. Set aside time daily to think, to plan and to grow your business. Treat it like client appointment time, because it’s just as important to your future. While there are a lot of reasons not to dedicate time to growing your business, it’s usually just a matter of getting your priorities straight. The Register | January-February 2017
Here are some tips to help prioritize your time: • Get Clear On Your Goals — As Stephen Covey taught, “Start with the end in mind.” This give purpose to your business and your life. Write down your goals and look at them daily. It only takes 5 Minutes, You’ll be tempted to skip this part, but will find it keeps you focused on what’s most important. What you put your attention on grows stronger. • Create an Ideal Daily/Weekly Schedule — This is the vehicle for working on your goals. Stop running as fast as you can. (It’s not helping, is it?) Instead, create a well-organized schedule, making sure to include at least some of your goals from above, and create time blocks for accomplishing. If it’s a larger project, break it down into the smallest manageable action steps, and make time each day to move towards completing them. • Plan Each Day Before Going Home — (15 Min) Most consultants operate down around the 20% efficiency mark. When you plan each day, however, you’ll find you accomplish about 80% of the activities on any given day or week, leading to the achievement of the goals you listed as most important to your business growth. That’s a 60% difference, or four times more efficient. And it’s a difference you can feel daily. • Include Your Critical “Big Five” — Allow a block of time each day to knock out your “Big Five.” These are a list of up to five critical activities that must be accomplished today, critical being defined as: If you don’t get them done, you’re not going home… So choose carefully. An insightful reference that elaborates more on this topic is Michael Linenberger’s, The One-Minute To-Do System. You can get a free copy of his e-book here: http://www.michaellinenberger.com/ TheOneMinuteTo-DoList-Ebook.pdf Of course, any system will break down if it’s overloaded, so the goal of your business plan should be to work towards ending up with all A-level clients, give them all A-level service, and collect all A-level fees. This will give you the time and freedom to expand your business in any direction you choose. Making time to work on growing all aspects of your business is an investment that pays off quickly in terms of more time from being organized, focused and productive. You’ll produce more while working with fewer, but larger clients. You’ll The Register | January-February 2017
Service work can often be used as a convenient excuse for avoiding the marketing you can’t or don’t want to do.
also have more energy from proactively knocking out project after project. And finally, you’ll feel more confident and relaxed from being in control of the direction of your business. But be forewarned: Committing to growing your business will also shine a light on those areas which need to change, such as upgrading clients you think you can’t, delegating tasks you think you can’t, and giving up surfing the internet, gossip and perhaps a multitude of other activities you may not even recognize yet.
case, it means making the time to learn about all aspects of growing your business, master, the process of marketing, and implement time-tested time management systems, so you can eventually work less, have more fun, and make more money for both yourself and your clients.
Ironically, One Of The Best Ways To Create More Time Is To Strategically Grow Your Business If you don’t invest the time to grow your business, how will it grow? Commit one hour per day, even if you have to come in early or stay late in the beginning. If you’re working on the right activities, it’s only temporary. You can’t complain about the results you’re not getting if you don’t do the work (Thanks Mike B.) In this case, it means making the time to learn about all aspects of growing your business, master the process of marketing, and implement time-tested time management systems, so you can eventually work less, have more fun, and make more money for both yourself and your clients. You can’t complain about the results you’re not getting if you don’t do the work. In this
Max Bolka Max Bolka, RFC® is a 34-year veteran of the financial services industry who developed and served nationwide financial planning and investment clientele. For the past 20 years, he has also been “Building First-Class Financial Advisors” of all kinds through his industry professional speaking, writing and one-on-one mentoring program. For more visit his website. Contact: 828.713.4116 max@maxbolka.com www.maxbolka.com Page 27
Consumer Focus The Case of the Disappearing Pension
There was a time in America when you would work for a company for 30 or 40 years, knowing that in the future you could retire with a defined benefit pension plan. It would be waiting for you at the end of the trail, just like a faithful retirement angel, guaranteeing you and your spouse at least 75% of your old salary for the rest of your lives. You were set. Somewhere in the 1980’s those plans started to cough and gasp and by the end of the 1990s, they were almost extinct, replaced by plans that called for employees to save on their own through a company sponsored plan. The defined benefit plan had given way to the defined contribution plan. Defined benefits means just what it says. When you reach that age where it’s time to collect your pension, your benefit is defined. It is clearly spelled out and guaranteed in writing, typically good for life, for both you and your spouse. Defined contribution means just what it says. Employees contribute to a plan whereby the amount contributed is specified, usually tax deferred, and typically invested until retirement. When the employee retires, they can take benefits. The benefits are usually not defined, because that all depends on how the investments performed over the years. The Endangered Pension Just where the idea came into the heads of Americans that they were entitled to a pot of gold at the end of the rainbow is not clear. At the end of World War II, there was that a certain euphoria that existed. America had just defeated her enemies in war and now was emerging as the great golden empire. The depression was over and hard times were replaced by happy days. The good life could be had by the ordinary working man. Just get on with a big company with a good pension and, as long as you put in your years of service with them, you could live the American dream. The first inkling that pensions may not be able to live up to the commitments made to workers by big business was probably when the Studebaker Motor Company went bust in 1963. They were the first major automaker to default on pensions. In 1974, congress passed the Employee Retirement Income Security Act (ERISA), which held corporations accountable for pension trust funds and provided accounting standards that they all were required to meet. Accountants were hired and audits were performed. If it was determined that if a
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The Register | January-February 2017
“A corporation’s responsibility is to the shareholders, not its retirees and employees. Companies are doing everything they can to get rid of pension plans, and they will succeed.” — Ben Stein pension fund’s liabilities (promises to workers) exceeded its assets, then the deficit could negatively affect the company’s value on the market. Pension fund managers that had at first been conservative with pension plan investments eventually gave way to the lure of the lucrative stock market during the boom years of the 1990s. In fact, during those days, many pension plans were overstuffed with assets. Companies could count the pension fund surplus as part of their earnings, and this hiked up the value of those companies measurably. Then came the market correction of the 2000s. Returns dwindled, and pension plans took a beating. One after another, pension plans began faltering, and corporations began deciding that these burdensome retirement plans were no longer viable. General Motors, which was forced to declare bankruptcy in 2009, is probably the best example of how the underfunding of pensions can force a large corporation to change from defined benefit plans to defined contribution plans. In its June 6, 2009 issue, USA Today reported that the
giant auto maker’s pension plan was underfunded by $20 billion. Thanks to a government bailout, GM recovered and reported an $8 billion net profit in 2011. But according to the New York Times of February 15, 2012, the GM pension plan was not to be so blessed. Despite the company’s comeback, the Times reported that the pension plan was still underfunded by $8.7 billion. As a result, back in October of 2012, GM’s 19,000 salaried workers who had been covered by GM’s pension plan, were shifted to a 401(k)-type plan. GM had already stopped putting new salaried employees into the pension plan in 2001. Sadly, a number of companies have been turning to bankruptcy as a way out of burdensome pension obligations. Strategic bankruptcies are still headline news, especially with large corporations like Delta Airlines, but the news is no longer shocking. Less than 20% of today’s workers are covered in defined benefit programs. Analysts predict that in the next decade, it will diminish to zero. Of great concern to many, is the fact that some government pension plans, once
thought to be above the fray, bear even higher underfunded liabilities than those in the private sector. Towns and municipalities are now forced to choose between keeping their pension promises and providing basic services such as education and road repair. Create Your Own Pension to Establish SWANonomics If you have a pension, especially one with the guarantees described earlier, then consider yourself one of the fortunate few. But for everyone else, let’s face it, we’re going to have to create our own pensions. Naturally, the younger you are the better. But, if you wait until later in life, it’s still not too late to start a personal pension plan. Make sure you understand what you are doing, of course. I call it Retirement Autopilot and there are many great annuities in the market today that offer guaranteed lifetime income payments that make it easy for the average retiree to establish a sleep well at night account otherwise referred to as “Swanonomics”. There are many upsides to having a personal pension plan as opposed to company sponsored plans. One upside is that you do not have to depend on anyone else. You are not at the mercy of the big company any longer. If you don’t like the environment in which you work, you can pick up and leave and take your pension with you. It’s yours. You control it. You make the rules.
Peter J. “Coach Pete” D’Arruda, CTC, RFC® Peter J. “Coach Pete” D’Arruda, , CTC, RFC® is a Financial and Tax Coach. He is host of the nationally syndicated weekly radio show, The Financial Safari, as well as the author of four books, including “Fine Print Fiasco”, “Financial Safari, 7 Financial Baby Steps” and “Have you been talking to Financial Aliens?” Themes of these easy readers include helping others avoid being taken advantage of and translating financial jargon for any layperson. Contact: 919.657.4201 pete@capitalfinancialusa.com www.capitalfinancialusa.com Consumer Focus articles are available to IARFC members. You may view and reprint Consumer Focus articles at: iarfc.org/consumer_articles.asp The Register | January-February 2017
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International News 2016 Event and Education Program Highlights
Audience Participation RFC® Training Seminar Macau
2016 Greater China IARFC Conference group Photo in GaoXiong Taiwan
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The Register | January-February 2017
2016 Highlights IARFC Greater China Conducted close to 40 RFC® training courses. Over 2000 members received the RFC® designation. IARFC Greater China 2nd IARFC Conference, March 13-5, GaoXiong Taiwan. Around 300 RFCs from China, Taiwan, Hong Kong and Macau attended. IARFC Hong Kong Continuing Professional Development Seminar, July 16, Macau. Mr. Matthew Kwok, a well-known Hong Kong based investment commentator spoke on “Brexit and Financial Planning: Relationship and Influence.”
RFC® Graduation cum Conferment Ceremony, City University of Macau; front row from left, 5th – Dr. Teresa So, 6th – Mr António José Félix Pontes and 7th – Prof Shu Guang Zhang
IARFC Hong Kong and Macau RFC® Graduation cum Conferment Ceremony January 16, City University of Macau, Macau. Dr Teresa So, Chairman (then Adviser), Hong Kong and Macau, IARFC officiated at the ceremony, together with Prof Shu Guang Zhang, Rector, City University of Macau and Mr. António José Félix Pontes, Chairman, Macau Institute of Financial Services. Additional designation award ceremonies were held in Chengdu City, Zhengshou City and Hong Kong. IARFC Hong Kong and Macau The Certificate in Financial Consulting (Executive Program), the RFC® education program, August, Hong Kong Baptist University, Hong Kong was once again successfully completed with 30 enrollments. This is the eleventh intake delivered by Hong Kong Baptist University. Students who successfully complete the program are eligible to apply for the RFC® professional designation.
Upcoming Events RFC® Graduation cum Conferment Ceremony January 6, 2017 Hong Kong Baptist University, Hong Kong
Dr. Teresa So addressing the RFC® conferees The Register | January-February 2017
Dr. Teresa So, Chairman, Hong Kong and Macau, IARFC will officiate at this spotlight event to confer the RFC® professional designation to over 40 qualified practitioners who meet high standards of education, experience and integrity. Page 31
IARFC BOARD
Viewpoint
The Register tap’s into the experience and viewpoints of the IARFC Board. They come together from different backgrounds, with different goals and expressing different opinions. The constant is the respect and dedication given to their commitment to the IARFC.
One Consultant’s Fiduciary Regulation Is Another Consultant’s Opportunity From my perspective, the DOL regulations going into effect this year don’t really change the philosophy from which I operate. It just adds more disclosure… aka… more paperwork — about 10 to 15 more pages per transaction. Right now if a person was to initiate a managed investment account with Money Concepts, there would be approximately 120 pages of paperwork to execute — with almost 100 pages being disclosure. Most probably it will increase. When a consultant operates as a “product peddler” there is a legitimate reasoning for such disclosures. However those of us who operate in the best interest of the client or in a proper fiduciary role do not need to change our way of operating. Fiduciary responsibility is a basic premise of the IARFC Code of Ethics.
Regardless of the regulations, our planning strategy does not change. We are fortunate. Election of any president is not an issue. This past election was mired in public ridicule and attack. After the election — nothing much changes with our clients. It’s all a political show. The real issue is the economy.
Today, more than ever, people need financial advice. What is a constant — our fiduciary responsibility when it comes to serving our clients.
The new president has stated on a couple of occasions that he wants to change the regulations for small business. That will be a relief to many small business owners. Our company has paid thousands of dollars to participate in these regulations that add paperwork. We are able to survive — others are not.
Who it does hurt are the small companies that do not have the technology to keep up. These governmental roadblocks make it harder to run a business. If you don’t transfer to virtual assistance, a 3 hour application interview could run 2-3 times that to execute.
In looking back through my many years in this industry — these new opportunities bring to mind the Clinton administration and how their economic policies affected our industry. Company downsizing and the releasing of older workers off the payroll gave a boon to the financial consulting profession. People needed financial advice. That is when Money Concepts prospered.
Most of us see these changes as one more headache. The DOL knows nothing about the financial planning business and is trying to regulate it by fee only. However, while it may put many of the smaller companies out of business, we see it as an opportunity as there will be hundreds of thousands who might lose their financial consultant.
Money does not come with instructions. Reading Board Member Jon Roger’s article in the Nov/Dec Register had me reminiscing about my longevity in this business. I entered through the insurance side and in 1954 produced my first one million in sales. I appreciated then what the industry did for the public. I saw that need
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about 50 years ago and wanted to devote my career objectives to recruiting, training and supervising financial consultants.
James B. Moss, CEP®, RFC® James B. Moss, CEP®, RFC®, is the Regional Director for the Cross Roads of America Region of Money Concept International. The Region has always ranked in the Nation based on gross income to associates. Today they have 32 Advisors operating in Indiana, Michigan, and Texas. Jim has retired from his position of Director of Continued Education for Money Concepts where he traveled throughout the U.S. conducting training sessions for Money Concepts advisors. Contact: 877.841.0370 jmoss@moneyconcepts.com www.moneyconcepts.com/jmoss The Register | January-February 2017
It’s Always Too Early To Give Up
Difficulties bring out your best qualities and make greatness possible. The superior selling performances you admire usually take place because the individual subscribes to what we call the “Fail Forward — It’s Always Too Early to Give Up” philosophy. When you “fail forward”, you learn from your experience. You strengthen your resolve. And, you move steadfastly toward your goals. Generally, in today’s marketplace, you have to make more than the initial contact with a prospect to get a sale and gain a client. Studies reveal that: • 5 8% — more than half — of all salespeople quit completely after a single call on a prospect. • 20% make two calls before giving up. • 7% make three calls. • 15% make five calls or more, and these are the stars we honor because they produce about 75% of all the business. It’s not what happens to you as a salesperson — but what you do after it happens — that The Register | January-February 2017
makes the big difference in your selling life. It’s the salesperson who uses difficulty, not the one who avoids it, who grows and goes to the top in the company. A feature story on Fred Astaire included a quote from a critic’s review early in his “sales” career. “Can’t act. Can’t sing. Balding. Can dance a little.” Such is the story of life. Such is the story of selling. The important question is whether or not you allow difficulties to bring out the best in you. Do you “Fail Forward?” Fred Astaire certainly did!
Dr. William L. Moore, Sr., CLU, ChFC, RFC®
Opposing circumstances create selling strength. Fear of opposition will keep you uptight, rob you of drive and take the edge off your selling effectiveness. Customer opposition and competition will make you stronger. That’s why your reward for success in selling will not be what you gain from it, but rather what you become because of it.
Kinder Brothers International teaches sales and management professionals how to experience lasting success. Dr. William “Bill” L. Moore, CLU, ChFC, FIC, RFC® Vice President and Sr. Consultant, has 32 years of experience in the Financial Services Industry and an immense knowledge of Sales & Marketing, Management Development, and Agency Building.
Join the ranks of the stars in selling today — resolve to make five or more contacts with a prospect!.
Contact: 214 .458.4154 wmoore@kinderbrothers.com www.kinderbrothers.com Page 33
Connect to your Benefits
Partner Programs Group Insurance Details at www.IARFC.org/insurance The Standard Insurance Company and Michael Insurance Planning Company offer Life, AD&D and LTD for IARFC members. Competitive premiums designed for consultants and employee assistance programs. For new members, these plans are available up to 30 days after joining the Association with no medical form required – guaranteed issue up to $250,000. Eligibility is based on a current membership with the IARFC.
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Software To receive a 40% off use coupon code IARFC www.covisum.com/IARFC A subscription to Social Security Timing® gives you access to our industry-leading, patented software and our team of Social Security experts. Strengthen your value to clients by showing ways to make even smarter decisions about when to realize income or gain for a more tax-efficient income with Tax Clarity™.
Practice Tool Sign up today www.copytalk.com/ct/index. po?promocode=IARFC If you are looking for the most useful organizational and compliance tool, look no further than Copytalk Mobile Scribe. Sign up today and for only Retail $79.95 $49.95 per month you get a personal, SECURE transcription service.
For a complete listing go to www.iarfc.org/partnerprograms 800.532.9060 • info@IARFC.org • www.IARFC.org
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INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
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The following should be read carefully by the applicant: 1. I hereby certify that I have read and understand the foregoing statements and that my responses are true and complete to the best of my knowledge. 2. I hereby apply for IARFC registration and, in consideration of my application, I submit myself to the jurisdiction of the organization and hereby verify that I agree to abide by all the provisions of the bylaws and regulations of the organization as they are and may be amended; and I agree to comply with all such requirements, subject to right of appeal as provided by law, and I agree that any decision as to the result of any examination(s) that I may be required to pass or annual CE requirements will be accepted by me as final. 3. I further agree that neither the association nor its officers or employees shall be liable to me for action taken or omitted in official capacity or in the scope of employment, except as otherwise provided in the statutes, bylaws, or the association’s rules and regulations. 4. I authorize the organization to make available to any federal, state or municipal agency, or any securities or commodities industry self-regulatory organization, any information they may have concerning me or to request confirmation of my status, and I release those organizations, employees and agents, from any and all liability of whatever nature by reason of furnishing such information. 5. I further agree that any part of the information contained in this application and any subsequent documents in my IARFC registration file may be divulged to interested parties as part of the referral system for the benefit of members and the public. 6. I hereby certify that I have a sound record of business integrity with no suspension or revocation of any professional licenses, and I hereby subscribe to the IARFC Code of Ethics, a copy of which I have read and understand. 7. It is agreed and understood that any material misrepresentation of facts or information given in this or subsequent application or renewal may be cause for immediate revocation of membership and all its privileges, without refund of any dues or fees paid. 8. I understand that failure to disclose any regulatory event, including suspensions or revocations, may disqualify me. 9. I agree to maintain proficiency in my work by completing continuing education in the field of financial planning and counseling — which can include subjects relating to practice management, delivery of professional services, portfolio management or financial product application and service. 10. As an applicant for registration, I understand and agree that my RFC designation with the IARFC will not become effective until submission of all required documentation in proper order and upon written acceptance by the IARFC. 11. I understand that all IARFC Certificates of Registration remain the property of the Association and must be destroyed or returned to the Association should my membership or the right to display the designation certificate be suspended or terminated. 12. I understand that continuation of the RFC designation requires 40 hours of CE per year, which commences January of the year following acceptance. 13. I understand that if I do not meet the required professional experience of 4 years, the IARFC will qualify and award me the RFA designation. _________________________________________________ SIGNATURE OF THE APPLICANT (required) How did you learn about the RFC? Direct Mail
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IARFC Code of Ethics Brand Your Ethics Approved Status Set yourself apart from other consultants • Affix your Ethics Approved Seal to your framed RFC® Certificate • Send an IARFC Ethics Approved media release to your contacts • Order business cards with the Ethics Approved Seal • Place digitized Seal on your website in a prominent position • Mention this program in client newsletters • Order additional Ethics Approved Seals as a visual reminder • Display the IARFC Code of Ethics plaque in office • Put a link to the IARFC Code of Ethics on your website Visit the IARFC store for these valuable branding tools www.IARFC.org/Store or contact 800.532.9060, info@iarfc.org
IARFC INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
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education • experience • integrity fe I Ed nsu uc ra at nc Learn more about the RFC ® io e L n Re ice professional designation n qu s call 800.532.9060 or visit www.IARFC.org ire e F m ulf en ill t s