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Category Archives: Business Tips

Retirement Planning is Key for Security

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Retirement planning should be an important consideration for all workers, even those who think they’ll never retire, or who intend to work as long as possible. In reality, nobody can predict the future, so no one can say how long ‘possible’ will be. Unexpected events such as layoffs, disability, or the need to care for an ill or dependent family member can bring an end to people’s working years long before they thought it would happen.

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Securities Industry Essentials Exam (SIE EXAM) 2016

exams concept

You may have heard that FINRA is going to be changing several exams to reduce redundancy and streamline the Securities Industry Essentials Exam (SIE EXAM) 2016 process.  They are proposing to offer a core exam covering:

  • the structure and function of the securities industry
  • the regulatory agencies and their responsibilities
  • basic economics
  • product knowledge, including stocks, bonds, and mutual funds
  • practices that are regulated and prohibited
  • professional conduct

This exam will have 100 questions, and individuals need not be sponsored by a company to take it.  Candidates will not be required to complete a U-4 or to be fingerprinted for this test.   Because of the minimal requirements, companies may encourage their employees to take the exam to increase their level of professionalism.   In addition, individuals who are still in school may take the exam, and persons thinking of making a job change or unemployed may take the exam to assist their job search.  If these candidates pass the exam, they will have four years in which to find employment with a sponsor before the passing grade expires.  If candidates fail the exam, they must wait 30 days to re-test.  A second failure requires a 30 day wait, and a third failure requires a 180 day wait.

Once the individual is hired by a sponsor company, he or she will be required to complete a “top off” exam containing specific material for Series 6, 7, or several of the more specialized FINRA exams.  Using Series 7 as an example, the specialized exam is likely to consist of 150 questions.  With the core exam of 100 questions, the total of 250 questions will be exactly the same number as contained in the Series 7 exam today.

At the November National Society of Compliance Professionals Annual Conference, it was suggested that the core exam would be released in late 2016, and the “top off” exams would be added in early 2017.  No outlines have been released for any of the exams, so we will be watching developments very carefully during the year to bring you the latest information.

NASAA has just announced that they will implement changes to the Series 63, 65, 66,  exams as of July 1, 2016.  Please see our articles on these separate exams so you are prepared!

How Simplification Can Help Advisors Increase Sales

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One of the most common questions that financial advisors have is what percentage of prospects should be closed after sitting down together. Although the exact answer may slightly vary based on who is asked for an answer, the general consensus across the industry is that the close rate for this scenario should be around 30%.


Advisors with a close rate significantly above this percentage should give themselves a pat on the back for already having their sales process nailed down. For advisors who are closing far less than 30% of the prospects they sit down with, this benchmark shouldn’t be viewed as a source of defeat. Instead, it should be thought of as an opportunity for significant improvement.


The good news for advisors who are currently below this close rate is there’s generally a clear reason why. That reason is the sales proposals an advisor is using for their investment proposal is too complex. As the financial planning industry has become more complex, many advisors have assumed that their proposals need to as well. This thinking has resulted in advisors presenting clients with proposals that are 30 or more pages in length.


What trained financial advisors forget is their proposal presents the last step before a client is closed. That means even if prospect has been properly qualified and all communication has been positive up to that point, an overly long proposal can overwhelm a prospect and cause them to get cold feet.


Here’s exactly what certified financial planners with proposals that are preventing at least 30% of prospects from being closed need to do to reach this benchmark:




This classic acronym stands for Keep It Simple, Stupid. Although it’s not the most elegant phrase, it’s a good reminder to not overthink and instead simplify. Advisors should keep in mind that making a proposal simple can actually take quite a bit of hard work.


2. Aim for Under 10 Pages


One of the reasons that proposals are so challenging to simplify is there’s a lot they do need to cover. So while it’s not realistic to attempt to make a proposal fit on 1 or 2 pages, keeping it under 10 pages is definitely something that can be done.


3. Use An Outline to Guide the Structure


A big part of striving for a simplified and shorter proposal is so potential clients can actually evaluate everything in it. Another way to help them do that is by using a clear outline as the structure for the full proposal. Putting the proposal in this format will ensure they don’t miss any important information.


4. It’s All in the Presentation


By getting a proposal down to an optimal size, it can be used as part of a strong sales presentation. At this point, the final step for an advisor is to practice and perfect their actual pitch.


By putting the above steps into action, financial advisors can transform their proposals from a roadblock into an asset that helps them increase sales.

What’s the Best Way for Advisors to Handle Client Disputes?

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There are a lot of rewarding aspects of being in the financial planning industry. But that doesn’t mean everything is rosy for financial advisors. As with any profession, there are challenges that trained financial advisors have to face. And in some cases, advisors have to deal with very unpleasant circumstances and handle client disputes.


One example of a very unpleasant circumstance most certified financial planners have to deal with at some point in their career is a client who thinks their advisor harmed them. While advisors already act with a fiduciary standard, there’s no guarantee that every client will think that’s enough. The reality is if something goes very wrong for a client, chances are they’re going to blame their advisor.


When this occurs, it can create a significant headache for an advisor. It’s important to understand that the fallout from this type of situation can happen regardless of whether it’s the client or advisor who’s in the right. The worst case scenario is if a client escalates the matter to the point where it has to go to court. Dealing with an arbitration panel can also be a very stressful experience.


Financial Advisors Need to Be Proactive


Many financial advisors assume that if they treat clients well, communicate clearly and adhere to ethical standards like not misrepresenting any aspect of an investment, they won’t have to worry about any significant client disputes. Although that approach and desired outcome will hold true for the majority of clients, there are always going to be problematic clients looking for a financial advisor.


The best case scenario of working with a problematic client is they only waste an advisor’s time. The worst case scenario is this type of client drags an advisor into arbitration or an other legal venue. Since trouble clients present a lose-lose proposition, the best thing an advisor can do is learn how to avoid them.


Manipulative behavior, constant victimization, major delusions, radical moods or goals that are disconnected from reality are all signs of a truly problematic client. If any of these behaviors are exhibited during an initial consultation, the best action an advisor can take is politely declining to take on the individual as a client.


Despite their best efforts, it’s not always possible for an advisor to avoid taking on a dysfunctional client. There are plenty of examples of clients who don’t start showing the major warning signs of trouble until they’re already in a relationship with the advisor.


If major issues start to arise with a client, advisors need to go the extra mile to ensure they document everything. By having comprehensive documentation, advisors can protect themselves in the event that things get escalated to arbitration.


In addition to carefully documenting everything related to a problematic client, advisors shouldn’t hesitate to look for the right opportunity to amicably end their relationship. By being proactive with these kinds of actions, financial advisors can minimize their negative interactions and focus their energy on all of the things that make this profession so great.