How RIAs describe exactly what they do in a few choice words

A selection of responses we received from folks in the RIA business

Tuesday 10.4.11 by Readers of RIABiz

Brooke’s Note: Surveys have shown that most investors really don’t know the difference between a stockbroker and an RIA. This is alarming but perhaps not surprising. After all, who has really spent any time cogently explaining the difference to consumers? I’m not talking about sales-literature mumbo jumbo – I’m talking about an explanation that hits the mark intellectually without eliciting the dreaded MEGO response: “My eyes glaze over.” In other words, it needs to improve upon and condense the job description I offered in yesterday’s article: See: What exactly is an RIA?. The truth is that it’s an exceedingly difficult task – kind of like coming up with a new advertising slogan for a fire alarm company. Maybe harder, because advertising agencies use the collaborative approach to come up with polished and illustrative phrases. I believe that this can be a helpful approach for coming up with RIA elevator speeches. Here are seven attempts, including the first one by Jeff McClure that is delivered to us with the wisdom and humor befitting this challenging undertaking. Try one out the next time you’re distinguishing yourself from your biggest competitors – brokers at Wall Street wirehouses.

From the personal wealth coach:

When I have a few seconds to describe what I do, I simply say, “We are a fiduciary organization. That means that we do not sell investment products in order to get paid by a company. Instead we work only for our clients and only in their best interests.”

If I have a little longer, I go on to say, “We are not financial advisors. That is what financial salespeople call themselves to get around the issue of taking full responsibility for what they recommend. Instead we bear full responsibility. We will never tell you to read the prospectus carefully before you invest, that is our job. We take responsibility for what we recommend.”

Often, I’ll get the [response], “I think that is what I have.” I then suggest that they ask whoever they are working with to put in writing that the person will serve as a fiduciary and act solely in your best interests. I tell them to then note whether or not the representative dodges the question.

My wife has said the term “fee based.” is the one that seems to ring true with her friends. When she says that I am “fee based” then they get it. I recognize that is not a completely pure answer, but it does seem to work. So, my other approach, which I use when time is really short is, “I am a fee-based portfolio manager for individuals, families, small businesses, and trusts.”

Oddly enough, she has commented that “fee only “ seems to frighten people. Since she is a hospital chaplain I trust her insights on what people feel far more than my estimations.

Jeff McClure
The Personal Wealth Coach
Salado, Texas

From one who answers to a higher boss

[An] RIA is an advisor whose only boss, only concern is to benefit the investor.

Roger Willroth
Marrs Wealth Management
Ames, Iowa

Getting your point across by the 28th floor means no wasted words.
Getting your point across by the
28th floor means no wasted words.

From the navigator

The following is my elevator talk: “As an RIA I ask three questions: Where have you been? Where are you now? Where do you want to be in the future? My firm then provides you with a road map of how to get where you want to be.”

Rob Price
Price Financial Group, Inc.
Waldorf, Md.

From the wealth tracker:

A good RIA should provide counsel and education on a client’s financial assets. Like a CPA, but with an investment twist (not the Fed’s twist). We provide a way for the client to stay disciplined and on track giving them time to concentrate on how they really make money… by doing their job.

Michael R. Vogel
Managing Director
Quantum Capital Management
Corte Madera, Calif.

From the strategic consultant:

My elevator speech for what an RIA is: “A small business focused on providing objective, independent advice to investors for a fee.”

Timothy Welsh
Nexus Strategy
Larkspur, Calif.

From the trusted CFO:

I tell folks that RIAs are specialists trained to work side-by-side with them to assist in making sure that the money they have is invested so as to work the best way possible in order for them to achieve their dreams and goals. An RIA is a trusted partner who should always be there to lend her/his education to the investor who already knows where they want to end up. The investor is the CEO; the RIA is the trusted CFO.

Philip M. Cioppa
Arbol Financial Strategies, LLC
Managing Principal and Chief Investment Officer
Norwalk, Conn.

From the well-aligned:

Registered investment advisors serve clients in a fiduciary capacity, much like an attorney or an accountant serves their clients. We’re held to a higher standard of prudence than traditional brokers or insurance agents and we’re required to always place our client’s best interests ahead of our own. There’s a novel idea! So, when you’re working with an RIA, whether you’re discussing insurance, retirement, estate planning or ideas about shelter taxes, you know that the recommendations being made are in the client’s best interest, and not those that’ll send the broker on a trip to Hawaii!

Charles F. Fellows
Sequoia Wealth Counsel
Cincinnati, Ohio

Jeff McClure | Roger Willroth | Rob Price | Michael Vogel | Charles Fellows | Philip Cioppa

RIAs | Marrs Wealth Management | Price Financial Group | Sequoia Wealth Counsel | Quantum Capital Management | Arbol Financial Strategies