Real Fiduciary, Real Credentials, and Education

Video Chapters & Transcript:

Howdy folks. Welcome back to Smarter Money Matters. And uh it really does. And today we’re going to have another winning with Camarda segment and kind of talking about the differences between Camarda and most other advisors, you know, and this is primarily for our clients, especially those that have been here for a while. you newer folks know why you came to us and and the all the differences that we bring to the table, but folks, you know, that have been with us for a while may tend to forget and kind of just get used to it and not realize we think how much better you’re off with the way we do it. So that’s where we’re going to begin. Of course, I’m Dr. Jeff Camarda, your wealth doctor, joined with Super CFPs Anna and Lou. So the first difference that Kamada brings to the table which is really really important um is we are what we call real or true fiduciaries. What does that mean? A fiduciary has a legal obligation to put your interest first. Not trying to make money by selling product maybe like a car salesperson or dealer uh but to put you first as a fiduciary. Right? Most people understand that concept. Most people don’t understand that there are many advisors out there that have both fiduciary licenses and they have commission licenses. And why is that a problem? Uh Lou, but we can speak from the northwards first. Yeah, absolutely. I mean, so to us, you know, we call that two-head fiduciary, two-head advisor because, you know, they can appear to be a fiduciary when they’re signing you up as a client, but then later on when they’re, you know, investing potentially investing your portfolio into into they can switch hats. They can switch hats and notice you won’t notice. Most likely it’s it’s in somewhere in deep, you know, embedded deep in in the fine print of their, you know, the stack of legal leads. and you’ll never understand that that you know they actually are making potentially commission or or other ways of getting compensated outside of just that fee that they’re showing you up front as a fiduciary that could be additional costs that that you may not be aware of. And you have anything to to add to that, Anna? I mean, yeah, we we see this a lot with some of our um you know, clients, newer clients that we we bring um you know, get from that have assets at other firms when we look at um the statements and the way they were invested and explain to them, hey, your previous advisor, you know, had a broker’s license, a commission license in addition to their investment advisory license. We can often see that in how the accounts are structured. There’s a lot of expensive stuff in there, right? They didn’t know that was completely under the radar. So that’s really the danger is, you know, it’s uh um you know, if I’m a two hat advisor, it’s like g whiz, I’m are you a fiduciary? Yes. Do you uh do you charge uh um the um uh fees? Very low fee. Yeah. So I may give you a low ball fee knowing that later, you know, once I have your trust and you’re not scrutinizing me anymore. I may switch hats and sell you some pretty expensive products. Well, Jeeoff, you tell a story about, you know, your experience back in back in your early days when you were uh working with a client and she had an advisor that that was a, you know, two had fiduciary and uh and you kind of pointed it out to her and she didn’t know it actually. It was probably maybe 15 years ago. I was not as young as you’d like they like to think I was. You But I’ll call Yes, I certainly guess I was. um the uh and I’ll call her Nancy and uh she came to one of our uh um one of our seminars and then met with me after I said Nancy one of the differences we’re real fiduciary she goes oh well my guys a real fiduciary too I said that’s interesting where are they at and she mentioned a prominent broker’s name and I said that’s interesting that’s mostly a brokerage house they make most of their money in commissions a product goes no not my guy’s a fiduciary go okay well maybe let me look at your statements as I look in the statements I see there’s a million dollars in this annuity annuity with this big life insurance company, right? And she put a million dollars in and the surrender value, that’s the amount that she would get if she cashed out was $900,000. And that’s a big commission, right? This guy probably made $80,000 over lunch and she had no idea this was happening. So Nancy says, Nancy point this out. Looks like a big commission. Something’s got to be wrong. Would you call my advisor and straighten it out? I go, all right. Uh his name, I’ll call him John. And we’re on the phone with John. And I go, “John, I’m here with Nancy.” And she, you know, she thinks you’re a producer. “Oh, yeah. I’ve got a series 65, an investment adviser.” I But you’re at XYZ firm. I mean, you’re mostly a brokerage. Don’t you have commission clients? Yeah, but not for her. Always have to do what’s best for her. You don’t make any commissions on her? No. I go, John, what about this annuity? And he goes, “Oh, except for that.” He actually said that Nancy was a ghast, but this stuff, this kind of happens all the time. Anyway, not to belabor the point, but there’s a difference. If you come to a fiduciary like a an attorney or CPA or a physician, you’re expecting to get the best of their advice without them trying to hustle something on the side that makes them more money. And we are the same way with us. What you see is what you get. We’re always laser focused on you without having any other compensation dog in the hunt. By the way, that’s, you know, that’s the base of my academic expertise. My dissertation uh for my PhD was on advisor ethics and training and misconduct malpractice. Um and I did a lot of you know research and published a lot of papers after that. And there’s a very very high correlation between complaints and fines and suspensions um and settlements with with advisors that are two hat fiduciaries have advisor have the investment advisor’s license and a commission license. And one final caveat, it’s not just you find a broker check, which we ought to talk about in a future episode. You also big conflict is that people have life insurance licenses. Oh, I’m a fiduciary, but you look on our website, we sell annuities, we sell life insurance, and these are some of the highest commission products out there. So, you really got to be careful. Anyway, with us, we don’t play that game. You know exactly what you pay. We’re very transparent and what you get. We don’t we’re not looking to make any money off the recommendation. So the next and difference and why don’t we start with you this time Anna is the training you know and the credentials and the constant you know teaching that we do here tell how does that you know separate us from your experience as an adviser elsewhere. Sure. So so you know to get a investment advisor’s license right um really for a lot of people it takes them maybe month or two of studying to get that license. Um there’s no academic degree requirement, no higher education requirement, no experience requirement. So you could have somebody with, you know, that’s only studied a textbook providing investment advice and and I’m, you know, unfortunately at prior for firms that I worked with, I did have, you know, co-workers where where that was the case. Um here, right? So Lou and I are certified financial planners, right? which is you know a robust industry designation with many experience education and it’s a serious credential. It really is a ser it’s an important zero credential. Yeah. And and and then you know in addition members of our team have other certifications CFA chartered financial analyst. Um obviously Jeff is you know has has much experience and designation but you know we like to think and we know what we are talking about. We didn’t just, you know, study for a couple weeks, take an exam, and then are advising clients. From my perspective, I think it’s very important for clients to look for those designations because, you know, if you’re depending on someone to give you advice, it should be important that that someone has credentials to prove that they know what they’re talking about. Yeah. And just let me kind of round it out. You know, one of the credentials that I have is a chart of financial analyst CFA, which is the CFP, which is where I started, you know, the beginning of my education journey, which so important, right? as to grounding in you know retirement planning and estate planning and taxation and risk management and putting it all together in financial planning. If I’m not mistaken, those are the six modules, right? You know, which is a really important foundation and and investments also, you know, and then beyond that though, the CFA is a focused study of portfolio management, you know, respected around the world, probably the most respected credential and really, really difficult to get. I’d say it was probably harder than getting my doctorate. It was really hard. Only 2% of advisors have the CFA. But g whiz if you’re paying for investment advice on a commission base you don’t know about or you know fees don’t you want somebody that studied you know and can demonstrate that you know they’ve got the knowledge and most don’t only 2% have that remember the actual investment advisor’s license that Ann’s talking about you can get that quick I got mine in a week in a week back when I started as a full service broker you know and I I I didn’t know what I was doing but I’m I’m I’m giving people advice and I put that you know in quotes you know I’m making major and I thought that’s all I needed to know and that really is the state of the industry. So you have to be careful. Um you know beyond that I’ve got a couple of other designations not going to trumpet them but what’s important I think besides the CFA is also the fact that I went and got a master’s degree at Georgetown Law School in tax because tax really is in my view the master wealth skill. It’s what hangs everything together. Doesn’t matter how much money you make. if you’re losing a big chunk of it to tax every year, you’re not going to get ahead nearly as quickly as you can. So anyway, that’s um that’s point number two. We have a lot of this to share with you, but we don’t want to overwhelm you. So next time I’m going to talk about our total wealth care concept and how everything hangs together and all that you get from Kamar beside just in besides just CFA level investment advice, but there’s so much more to put everything together. Any final parting comments? from the Great North Woods. No, I think we covered it pretty well. Uh, you know, for those two points and more to come in future episodes. How about you from the Oxent? [laughter] Um, no, I I think great conversation and I think it’s important for clients to to see this and kind of remember what sets us apart. Good. Well, that’s great. And also guys, so we’re going to continue with this in the winning with Kamarda segments. And also as a reminder, we have a new um the um the wealth education uh mode called Minute Wealth, which you can see on you follow the the Komardo Financial Facebook page or Instagram or Tik Tok or Twitter and all kinds. Sorry, Anna. She really isn’t feeling that well. Um I tease her, but she left me. [laughter] Thank goodness. the um on these other social media platforms. 302 or so very compressed bits of high uh quality financial education. We call it Minowealth. Please do yourself a favor, take a look at it, follow it. We’re doing one a day now. We have since January of this year, be going to two a day pretty soon. Uh so I think you’ll find it very useful and you might want to even share with your friends and family. A lot of valuable stuff there. Anyway, for now, this is Dr. Jeff Camarda, your wealth doctor, edggining out with our super CPFs, just Lou and just Anna. See you next time. Thanks for watching.