Nerd's Eye View blog

Discussing Inflation And Market Turmoil Using Questions To Navigate Difficult Client Conversations

November 16, 2022 07:03 am 2 Comments CATEGORY: Client Trust & Communication

With inflation running hot, a potential recession looming, and both stock and bond markets seeing significant drops so far this year, there is no shortage of potential stressors for financial planning clients. And as crises arise and stress builds up, some clients may reach a tipping point where they seek out their advisor looking for answers to ensure their financial plan remains on track. While it might be tempting to answer the client’s concerns coolly and directly, starting the conversation by first asking the client questions can result in a more fruitful discussion.

During times of stress, whether induced by market turmoil or other unpredictable factors, an individual’s first reaction is often fear. But sometimes this fear can morph into anger, as feelings of anger can give an individual a sense of control as opposed to the disempowering feelings of helplessness and vulnerability that often come with fear. So when a client calls and appears to be angry about situations beyond their control, it is important for advisors to recognize that fear may be the client’s underlying emotion behind the outward anger they are displaying. Further, this also means that while the client may appear to be angry with the advisor, they may actually be reacting from fear of a stressful situation.

When an angry client contacts their advisor during periods of financial stress, an advisor’s first instinct might be to directly address their concerns, perhaps by explaining how the client’s portfolio is diversified or that the market is almost certain to bounce back at some point in the future. But to an angry client, these quick answers could feel dismissive or combative, potentially escalating the situation. Instead of trying to answer the client’s concerns immediately and directly, the advisor can start the conversation with a series of questions to help the client diffuse their anger and better understand their underlying feelings. By engaging in active listening (e.g., by reflecting the client’s answers back to them), advisors can better understand the client’s feelings and thought processes while allowing the client to feel heard. Next, asking questions that help the client realize that there is always an alternative ‘Plan B’ solution (and figuring out what such a plan could look like) can empower the client by reassuring them that it is still within their power to take action and prevent their plan from failing, even if their market fears came true.

Ultimately, the key point is that crises are likely to come up for clients over the course of a relationship that lasts many years, and an advisor’s reaction to their client’s fear and anger can make the difference between provoking heated emotions and helping the client feel like they have gained more control over the situation. By asking questions, actively listening, and exploring possible scenarios – rather than immediately giving answers – advisors can skillfully diffuse stressful situations and potentially strengthen the bond with their client in the process!

#FA Success Ep 307: Dropping Your Broker-Dealer License Without Dropping The Broker-Dealer Platform, With Stacey Hyde

November 15, 2022 07:01 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 307th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Stacey Hyde. Stacey is the President of Envision Financial Planning, an independent RIA based in Memphis, Tennessee, that oversees nearly $200 million in assets under management for 206 client households.

What's unique about Stacey, though, is how, to gain more flexibility and independence for her firm, she and her partner decided to drop their FINRA licenses and launch their own RIA… while continuing their relationship with Commonwealth as their now-former broker-dealer platform.

In this episode, we talk in-depth about why Stacey and her partner decided to drop their broker-dealer licenses, and drop out of the corporate RIA structure, transitioning instead to fully owning their own independent RIA while remaining affiliated to their now-former broker-dealer so that they could keep the benefits of having back-office, tech, and investment support, why Stacey wanted to create her own investment advisory agreement for her firm from scratch so that she could simplify language for clients and help them better understand the firm’s offerings and the nature of their relationship, and why Stacey and her firm implement a fee schedule where the tiers are not graduated but instead have hard breakpoints where after a certain threshold, clients can see an outright drop in their fees… which makes it easier for Stacey to communicate the fee schedule to clients, while also incentivizing them to add funds and consolidate their accounts with Stacey to reap the benefits of those reduced fees breakpoints.

We also talk about how Stacey and her firm built their client base by leveraging both client referrals and an advisor network that has a long-standing relationship with a national steel company where Stacey is one of the advisors in a niche service offering that provides the company’s employees advice on their benefits packages (and, eventually, their retirement rollovers), how throughout most of Stacey’s career, she struggled to find the right position that fit her desire to help clients, and eventually decided that she would have to hang her own shingle as an independent to be able to serve clients exactly the way that she wanted, and how, even though it was difficult to transition away from her most recent employer, Stacey found comfort in the fact that clients ultimately rallied around her and offered support… which made her realize she had a greater impact in her clients’ lives and wasn’t seen as just their “advisor.”

And be certain to listen to the end, where Stacey shares how, even though she loves to travel to Colorado, she was afraid of taking more personal trips as she didn’t want to be seen as an inattentive advisor, but as more clients are embracing virtual and asynchronous meetings, she has realized she can do more of what she loves and be her authentic self while still staying connected with clients, why Stacey wishes she could have gone independent much sooner and attributes the delay to her internalization of societal messages that she believes reinforces a lack of confidence in women and makes them question their abilities to build a career on their own (which took her years to overcome for herself), and why Stacey believes that it is important that advisors show clients that they truly care and are not motivated purely by compensation as it creates better alignment, trust, and overall a more successful career.

So, whether you’re interested in learning about how Stacey can better serve her clients because she dropped her FINRA licenses, why going independent but still affiliating with her former broker-dealer helps Stacey and her partners clarify their brand, or why implementing breakpoints in fee schedules helps Stacey to better communicate fees and keep them fair for all clients, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Stacey Hyde.
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Hiring Next-Gen Associate Advisors: A Guide To Recruiting, Training, And Retaining For Your RIA

November 14, 2022 07:05 am 1 Comment CATEGORY: Practice Management

In the not-so-distant past, the typical career path toward becoming a financial advisor was to build up a book of business on one’s own, often by either tapping into one’s own personal networks or cold-calling prospective clients in bulk to generate enough business to gain a foothold. But the obvious flaw with this ‘eat-what-you-kill’ model was that newer advisors overwhelmingly succeeded or failed – not by virtue of the quality of advice they gave to their clients, but by how effectively they could sell the financial products for which they were usually compensated via commission.

In more recent years, however, the rise of the fiduciary advice model (in which the quality of advice provided to the client really does matter to the firm’s success) has allowed a new career path to emerge: that of the associate advisor, who generally takes on financial planning tasks, like data gathering and analysis, to support the lead advisor so that they can focus more on managing the client relationship and bringing in new business. And as the associate gains experience and trust among existing clients, they can gradually take over some of the lead roles themselves, to be supported by new associate advisors of their own – thus allowing the firm to transition its clients from the founder to the next generation of advisors.

But for many experienced advisors (and particularly those whose careers evolved through the older eat-what-you-kill model), integrating an associate advisor into an existing practice can come with its own challenges. For example, seeing eye-to-eye on the expected responsibilities of the associate advisor’s role, as well as the role’s future possibilities and its meaning to the associate advisor’s career trajectory, may not come naturally, especially when the senior and associate advisor are each from distinctly different generations – which can result in dissatisfaction from both parties if they aren’t both clear and in agreement on the role’s purpose and where it is headed.

In this guest post, Penny Phillips, president and co-founder of Journey Strategic Wealth, uses her expertise in helping advisors address some of the common challenges in introducing new associate advisors into their firms and how senior advisors can scale their time and productivity to successfully integrate associate advisors into their advisory practices.

One of the most important components of bringing on an associate advisor is being clear about the purpose and requirements of the role during the hiring phase. And because associate advisors are often hired in the early stages of their careers, it should also be clear how they will be taught and supported by the firm to succeed in the role. This can be achieved by establishing a framework of Objectives central to the associate advisor role, as well as clearly identifiable Key Results that will help team members recognize whether they are achieving the desired results.

Furthermore, this Objectives and Key Results (OKRs) framework can also be extended to the associate advisor’s career development to define and work toward key skills that bring them closer to what they want to achieve. And as the senior advisor’s own role evolves with the addition of an associate, they may want to develop their own set of OKRs to ensure they are progressing towards their goals for themselves and their practice!

Ultimately, the key point is that finding and developing an associate advisor will take time and effort – for both the senior advisor and the associate advisor. However, a successful partnership between senior and associate advisors has the potential to last many years and can allow the practice to scale up in ways that aren’t possible for a solo advisor. Taking care to start the process on the right foot can therefore pay dividends for both parties in the long term!

Weekend Reading For Financial Planners (Nov 12-13)

November 11, 2022 02:02 pm 5 Comments CATEGORY: Weekend Reading

Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that as enforcement of the SEC’s new marketing rule began on November 4, advisory firms are taking a variety of approaches. While some are looking to gain a first-mover advantage by leveraging client testimonials and third-party endorsements (and adjusting their compliance programs before doing so), others are taking a wait-and-see approach.

Also in industry news this week:

Why “SECURE 2.0” appears to remain on track to be passed by the end of the year, no matter the final results of the midterm elections
Amid an “incredibly active” period for cyberattacks, the director of the SEC’s examinations division highlighted the areas of cybersecurity where advisory firms are most often deficient

From there, we have several articles on advisor marketing:

Three tactics advisors can use to improve their ‘close’ rate with prospective clients
How a regular firm newsletter can keep clients engaged and improve retention
The most effective question advisors can use to end initial prospect meetings

We also have a number of articles on retirement planning:

How the recent increase in interest rates has made TIPS a more viable option to increase a retired client’s safe withdrawal rate
Why advisors need to take care when analyzing the expected performance of Registered Index-Linked Annuities (RILAs)
While “free” Medicare Advantage plans might sound enticing, advisors can help their clients assess whether a different plan might actually be more cost-efficient

We wrap up with three final articles, all about personal growth:

How advisors can harness the power of compounding, not just with investments, but to improve their health and relationships as well
How advisors can help their clients overcome the cyclical nature of investment knowledge, particularly when FOMO kicks in
Five mindsets that advisors can use to create success in their professional and personal lives

Enjoy the ‘light’ reading!

Maximizing Health Savings Accounts (HSAs) Tax Benefits With Adult Children Under Age 26

November 9, 2022 07:01 am 9 Comments CATEGORY: Taxes

The passage of the Affordable Care Act in 2014 introduced many changes to the healthcare landscape in the United States. One of these changes was the ability for children to remain on their parents’ health insurance plan until they reach age 26. In addition to having access to health insurance at a lower cost than they might have on their own, this measure also creates a potentially lucrative planning opportunity for young adults who can be covered by a parent’s High-Deductible Health Plan (HDHP), giving them the opportunity to contribute to their own Health Savings Account (HSA) up to the full family maximum contribution limit ($7,300 in 2022).

Health Savings Accounts (HSAs) are one of the most popular savings vehicles because of their triple-tax advantage: account owners can take an above-the-line tax deduction for eligible contributions, growth in the account is tax-deferred, and withdrawals are tax-free if they are used for qualified healthcare expenses. Notably, funds in an HSA that are withdrawn for any reason other than for qualified medical expenses before age 65 are subject to a 20% early withdrawal penalty. After age 65, though, there is no penalty, and funds can be used for any reason (but are treated as taxable ordinary income if not used for qualified medical expenses).

In return for these significant benefits, the IRS imposes certain requirements for who can contribute to an HSA: The individual must be covered by a High Deductible Health Plan (HDHP) (and have no other health coverage or be enrolled in Medicare) and they may not be claimed as a dependent on someone else’s tax return. Notably, the account owner does not have to be covered under their own healthcare plan, so a young adult who is covered under their parents’ HDHP plan (and who cannot be considered a dependent on their parents’ tax return) would potentially be eligible to contribute to their own HSA. Further, while spouses can only make combined contributions up to the family maximum contribution limit ($7,300 in 2022), non-spouses covered under the same health plan can make contributions to their own HSA up to the family limit as well!

Because HSA owners must be covered under an HDHP in order to contribute, it is important to first consider whether choosing an HDHP is the best choice given a family’s medical expenses and financial situation. This presents an opportunity for advisors to assess whether the tax benefits of HSAs outweigh the costs of opting for HDHP coverage (which typically has lower premiums but higher deductibles relative to traditional health insurance plans).

Ultimately, the key point is that because children are now allowed to remain on their parents’ health insurance plan until age 26, non-dependent children covered under a family HDHP may be eligible to contribute to their own HSAs. And as HSAs offer significant tax advantages, advisors can help clients ensure that opting for family HDHP makes sense financially for the family as a whole!

#FA Success Ep 306: Restructuring Partner Compensation And Roles To Align For The Next Stage Of Growth, With Cean Kenefick-Rogers

November 8, 2022 07:09 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 306th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Cean Kenefick-Rogers. Cean is the CEO and co-founder of Ironwood Wealth Management, an independent RIA based in Chandler, Arizona that oversees just under $550 million of assets under management, for nearly 500 households.

What's unique about Cean, though, is how the path that he and his partners took to break away from the insurance and brokerage worlds to run their own independent RIA inadvertently created a three-way struggle to find the proper compensation and accountability structure across their differing books of business, and ultimately forced them to seek third-party intervention from an industry consultant that eventually allowed them to restructure their partnership roles and compensation… which then unlocked their next stage of growth and scaling up the business.

In this episode, we talk in-depth about the journey that Cean and his partners took, from originally starting their careers at an insurance company, then moving on to a brokerage firm, until they ultimately decided to transition to an independent RIA and on the advice of their attorney drop their FINRA licenses altogether to reduce the risks to their RIA and simplify their ADV, how after struggling with infighting over proper compensation and accountability amongst the partners and almost reaching a point of dissolution, Cean and his partners sought help from an industry consultant to help restructure the firm roles and create compensation structures that all partners agreed were fair and would help the firm refocus on growth, and why shortly after taking on the role of CEO after that restructuring, Cean decided to implement a minimum quarterly fee and expand into an assets under advisement model that manages clients’ held-away 401(k) plans through Pontera… increasing both the profitability of the firm, and the happiness of their clients who now receive a more holistic service.

We also talk about how Cean leveraged the firm’s custodial relationship with Schwab to access one of their internal marketing consultants, which then led to Ironwood hiring an external marketing firm that revamped their website and Google searchability, increasing their visibility and digital leads to the point the revenue they received from onboarding new clients more than paid for the consulting, how, even though Cean proclaims to be a competitive person and does well under pressure, he was nervous about doing the right thing when taking on the role of CEO and turned to his friends who inspired him to form a firm advisory board to gain more confidence that he was making the right decisions for the firm, and how, despite understanding it would be difficult to launch and run an advisory firm, Cean was still surprised by how much work it actually takes… and even more surprised by the fact that he truly enjoys it.

And be certain to listen to the end, where Cean shares how, even though all the partners, including Cean, agreed he should take on the role of CEO in their new firm structure, it was challenging to adjust to viewing the firm not just as an advisor but its leader, and navigate the new pressures that come with having sole accountability and decision-making responsibility for the firm, why Cean wishes he and his partners dropped their insurance and FINRA licenses much sooner, as it would have given them more of an opportunity earlier to apply a laser-like focus on how they wanted to provide value to clients, and how Cean measures success beyond just his own contributions to the firm, but instead by building the right internal structure to support his employees so that they can continue to thrive, grow, and find their own successes.

So, whether you’re interested in learning about how designating Cean to the role of CEO helped realign the firm and created clear hierarchal structures, why Cean and his firm pre-schedule all of their client meetings for the year in advance, or how Cean and his firm implement service teams instead of departments, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Cean Kenefick-Rogers.

The Latest In Financial #AdvisorTech (November 2022)

November 7, 2022 07:03 am 1 Comment CATEGORY: Technology & Advisor FinTech

Welcome to the November 2022 issue of the Latest News in Financial #AdvisorTech – where we look at the big news, announcements, and underlying trends and developments that are emerging in the world of technology solutions for financial advisors!

This month's edition kicks off with the news that a new RIA custodian – Entrustody – has launched, as independent RIAs continue to clamor for more alternatives than what has now become the ‘Big 2’ of Schwabitrade and Fidelity. As with Altruist, the ‘other’ new startup RIA custodian to launch in recent years, Entrustody is pledging to have a more modern interface with a better user experience, more and deeper integrations, and a more transparent price structure than ‘traditional’ custody services.

Notably, though, the reality is that changing RIA custodians still requires the repapering of clients and retraining of staff (and the latter cost is still incurred even if firms ‘just’ add Entrustody as a second custodial platform without moving existing clients), which raises the question of whether Entrustody has enough efficiency improvements to actually convince advisors to switch. While at the same time, competition has already heated up for new advisors (who can pick a new custodian without repapering or retraining because they’re just getting started) with SSG, Altruist, and even Schwabitrade itself pledging no minimums, and a number of ‘new’ RIA custodial competitors like LPL and SEI are increasingly competing for breakaways as well. Which raises the question of whether and where Entrustody may even be able to make a beachhead in a surprisingly crowded marketplace for the few advisors who are in a potential custodial transition?

From there, the latest highlights also feature a number of other interesting advisor technology announcements, including:

Orion’s Redtail launches “Redtail Campaigns” in partnership with Snappy Kraken to facilitate CRM-based drip marketing emails
Hearsay Systems rolls out a new small-to-mid-sized RIA platform for social media compliance and website design
Riskalyze signals an intent to rebrand itself away from ‘just’ risk tolerance assessments to a broader focus on helping advisors grow clients and assets

Read the analysis about these announcements in this month's column, and a discussion of more trends in advisor technology, including:

Merrill Lynch launches a new ‘Merrill Match’ system that downplays an advisor’s geography and focuses more on advisor ‘fit’ with respect to expertise, meeting preferences, and communication style
Ezra Group launches a new “WealthTech Integration Score” for major AdvisorTech vendors to help advisors better assess which software has the most meaningful deep integrations

In the meantime, we’re excited to announce several new updates to our new Kitces AdvisorTech Directory, including Advisor Satisfaction scores from our Kitces AdvisorTech Research, and the inclusion of WealthTech Integration scores from the Ezra Group!

And be certain to read to the end, where we have provided an update to our popular “Financial AdvisorTech Solutions Map” as well!

*And for #AdvisorTech companies who want to submit their tech announcements for consideration in future issues, please submit to [email protected]!

Weekend Reading For Financial Planners (Nov 5-6)

November 4, 2022 01:58 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that as part of the ongoing integration between the merged companies, Charles Schwab plans to transition advisors currently on the TD Ameritrade custodial platform to Schwab’s platform over Labor Day weekend 2023. And while Schwab executives have asked advisors for patience amid the transition, some advisors currently on TD’s platform could choose from a range of alternative custodial options rather than be subsumed into the Schwab ecosystem.

Also in industry news this week:

How an SEC review of a FINRA proposal to facilitate remote work could signal its thinking on the supervision of remote work for financial advisors more broadly
Morningstar has joined an increasingly competitive market of direct indexing platforms for advisors and their clients

From there, we have several articles on investment planning:

While I Bonds have received significant attention during the past year, TIPS could be an attractive alternative for many client situations
A recent study shows that while many consumers have expressed an interest in ESG investing, such funds within retirement plans have received limited allocations from investors
A survey showing how millionaires allocate their assets and the importance they place on the recommendations of their financial advisors

We also have a number of articles on taxes and end-of-year planning:

The importance for advisors of understanding current RMD rules to ensure their clients take the proper distributions (and avoid a 50% penalty in the process!)
In addition to an announced decline in Medicare Part B premiums for 2023, advisors have a range of other ways to save clients money on medical costs in the coming year
Pundits continue to expect “SECURE 2.0” to pass by the end of the year, while passage of other proposed tax measures appears to be less likely

We wrap up with three final articles, all about RIA deal activity:

What the continued influx of capital from private equity firms means for the RIA industry as a whole
Why the torrid pace of RIA mergers and acquisitions activity seen in recent years could slow down in the current market and interest rate environment
While private valuations have soared in recent years, public markets continue to be less kind to RIAs

Enjoy the ‘light’ reading!

Kitces & Carl Ep 98: Fee Schedule Complexity And Managing The Fear Of Leaving Opportunities On The Table

November 3, 2022 07:08 am 1 Comment CATEGORY: Kitces & Carl Podcast

For many financial advisors, prospecting efforts have traditionally been based on a perspective of scarcity, where the aim was to focus on connecting with and closing as many prospects as possible, regardless of their actual needs. However, in order to accommodate a wide range of clients with wildly diverse needs, firms often need to provide a myriad of services to address those needs. And this can mean developing a fee schedule with so many layers of complexity – to price out the range of all the services offered – that many prospects often end out too confused to understand what the advisor can actually do for them.

In our 98th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss how a scarcity perspective can result in a firm’s loss of focus by trying to accommodate any and all clients regardless of their needs. Instead, by conveying a clear and simple message to clients about how the advisor’s value can provide for a very specific type of client and their unique needs, advisors can enhance their business growth by attracting the right type of client while investing less time and fewer resources actively seeking out new prospects.

As a starting point, it’s important to understand that as the financial services industry has evolved into the digital age, it has become increasingly common for financial advisors to rely on web-based business development strategies where the typical number of ‘prospects’ who visit the advisor’s website are often astronomically large. Which means that nearly all advisors who have a website no longer have a shortage of prospects (as they can often rely on organic web traffic alone to bring thousands of visitors to their site); instead, the challenge has become one of attracting the right kind of prospect. And offering a message that will compel even just a small fraction of site visitors to engage in a relationship can lead to a substantial increase in business.

As individuals increasingly rely on the internet to find the right services to meet their needs, more clients are also seeking and engaging with advisors digitally. Which means that understanding the nature of how those visitors use and relate to their website (through website data analytics tools) can give advisors the tools to assess the efficacy of their marketing efforts. Some useful metrics to help advisors understand their visitors include the number of users and visitors, where they look for information, and session length. And monitoring these metrics over time can help the advisor ensure that their messaging is truly offering a clear, meaningful, and relevant value proposition to prospects.

Ultimately, the key point is that trying to cater to all clients out of fear of leaving opportunities on the table – and developing complex fee schedules to meet all of those clients’ needs – will generally only serve to dilute an advisor’s value proposition. But by recognizing that firms already have access to a wealth of prospects through their website, advisors can home in on attracting the right kind of prospects to grow the business without losing the focus of the firm!

Upfront And Ongoing RIA Compliance Obligations Of State Vs SEC-Registered Investment Advisers

November 2, 2022 07:03 am 0 Comments CATEGORY: Regulation & Compliance

In the United States, Registered Investment Advisers (RIAs) are required to register in one of 2 ways: with the Federal government (namely the SEC) or with one (or more) state securities regulatory agencies. While SEC-registered RIAs are governed by the Investment Advisers Act of 1940 (and its associated regulations), state-registered RIAs are subject to the individual rules of the states (which have their own securities laws and regulations) where they are registered. So RIAs not only face a different set of regulations depending on whether they are Federally or state-registered, but state-registered RIAs, in particular, can also face a widely varying set of rules depending on which state they are registered in.

In this guest post, Chris Stanley, investment management attorney and Founding Principal of Beach Street Legal, breaks down some of the key differences between the Federal and state registration application requirements, approval processes, and post-registration requirements for RIAs.

While there is some overlap between the specific documents to be submitted for those registering with the SEC as opposed to the states, the universe of documents is far from identical. To start, Form ADV is the foundational registration document that must be submitted by any advisor seeking to become registered with the SEC or the states, but submission requirements for its various sub-parts vary depending on the registration type. For instance, while firms applying for either SEC or state registration are required to submit Form ADV Part 2A (the brochure and wrap fee program brochure), Form ADV Part 2B (the brochure supplement) is required to be submitted only by state-registration applicants (though SEC applicants are still required to create, maintain and deliver a brochure supplement to clients). Notably, along with certain standardized forms (e.g., Form ADV and Form U4), state-registration applicants are almost always required to submit additional ancillary documents to the state(s) in which they are seeking registration as part of their application.

In addition to differing registration form requirements, firms applying for SEC or state registration typically will have different experiences in the approval process. For example, while the SEC is required to respond to an adviser’s application within 45 days of the initial filing date, state applicants can expect more variable and longer lead times during the registration process. Further, while the SEC’s review process usually tends to be straightforward and permissive, some states will respond with additional questions, follow-up requests, and required revisions to the contents of the documents submitted.

Once an adviser’s registration application has been approved, they can begin advice-rendering activities, but their regulatory obligations do not end there. Along with renewing their registration annually (for both SEC- and state-registered firms), firms face a variety of requirements related to their internal finances, fees, marketing activities, and advisor agreements depending on whether they are SEC- or state-registered.

Ultimately, the key point is that while both the SEC and individual states share the goal of protecting the public from financial predators, advisers typically face differing registration, approval, and ongoing supervision experiences, depending on how they are registered. But by being aware of the varying requirements and filing documents in an accurate and timely manner, new firms can navigate their way through the registration process and (finally) begin offering planning services to clients!