A Cheat Sheet for Interviewing Financial Advisers by Julie Jason
If you are seeking a registered investment adviser to handle your retirement funds, where should you begin?
Start with the U.S. Securities and Exchange Commission’s Form CRS (Customer Relationship Summary). The CRS, a two-to-four-page document, can help you compare and contrast firms and their advisers.
In the CRS you'll see a list of questions the SEC would like you to ask ("conversation starters"). To me, one of the most revealing questions is about conflicts of interest and how the firm handles them.
What are some possible conflicts of interest? Advisers might receive higher compensation for recommending one investment over another. An adviser who changes firms could receive incentive compensation that he can lose if he doesn't meet production requirements.
Another question is whether the firm or adviser has "legal or disciplinary history." If the answer is "yes," the CRS will point you to the SEC's public disclosure site (tinyurl.com/44vfe8hc) for additional information. The details will give you a sense of a firm's culture.
Make sure you compare a few firms’ Forms CRS to get an understanding of them (including their fees). Then, interview the adviser who works for the firm whose culture you identify with.
I talk more on this subject in my lecture, "Form CRS: Practical Considerations for Attorneys" with the National Academy of Continuing Legal Education now on-demand. You can purchase it here.
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To read Julie Jason's books, go to: https://juliejason.com/author/julies-books.