FPA Changes Compensation Disclosure to Remove ‘Salary’

Amid growing industry debate over compensation disclosure, the FPA has changed its compensation disclosure options.

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Comments (4)
Full, comprehensive and honest compensation disclosure is important; but is still "malleable" and subject to interpretaion in accordance with the underlying intentions and service model of the advisor and the literal definition of the governing organization. I would like to see in addition a "Stewardship Standard of Care," which FPA, NAPFA and CFP(r)licensees smight indvidualy and voluntarily endorse...a statement which makes the outright pledge that my practice will always place the clients' interests above my own.

If ever there is a client dispute, it would be adjudicated on both the letter and the spirit of the "law."
Posted by Eric B | Thursday, September 05 2013 at 1:50PM ET
It is still confusing. There should be a "fee OR commission" descriptor.

The "fee AND commission" choice sounds like the same CLIENT could be paying both a fee and a commission. While this may happen in some cases, it is also true that an advisor may charge EITHER a fee OR a commission, but not both.
Posted by Karen D | Thursday, September 05 2013 at 2:23PM ET
This debate is bafoonary. I am a salaried planner...one of the very very few. I am not in sales. My compensation is NOT tied to "products", "5% commissions", or "1% AUM fees" (which are really commissions spread out over a longer time period...oh did I say that out loud?). So I now need to select a box that says I receive a combination of fees and commissions???????????? Really?
Posted by William D | Thursday, September 05 2013 at 2:27PM ET
It seems that how the planner is paid is strictly a function of how the employer derives all of their income. Kudos to the CFPBOS for reaching out and taking control of the firms that employ the licensee.

If I were Schwab, Fidelity, TDAmeritrade, I would be quaking in my boots!

As someone said recently, it is rubbish when the self-proclaimed regulator crawls into bed with the marketing organizations such as NAPFA and the FPA. It would have been nice if the organizations had had this talk before the marriage.
Posted by Consumer A | Thursday, September 05 2013 at 3:50PM ET
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