Latest / Money In Motion with Klaas Financial / The Spirit vs. the Letter

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The Spirit vs. the Letter · Money In Motion with Klaas Financial

0:00
Speaker 1: Lines are open for you if you have questions for
0:02
Speaker 1: our retirement planning professionals from Class Financial. The number to
0:05
Speaker 1: get on the air six SOH eight three two one
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Speaker 1: thirteen ten. That's six SOH eight three two one thirteen
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Speaker 1: ten gets you right on the air with CJ. Closs
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Speaker 1: and Nate Briby. As mentioned, they are our financial planning
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Speaker 1: professionals from Class Financial. You can learn more about them.
0:19
Speaker 1: You can learn about Coss financially. You can learn about
0:21
Speaker 1: their separate divisions. You can also listen back to this
0:23
Speaker 1: in previous shows podcast as well. That all available to
0:26
Speaker 1: you at Cossfinancial dot com. That's Closs Klaas Financial dot com.
0:32
Speaker 1: And the telephone number for the office right here in
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Speaker 1: Madison six oh eight four four two five six three seven.
0:37
Speaker 1: No charge for that initial get to know you appointment
0:39
Speaker 1: at COSS Financial. It will be complimentary to you again
0:43
Speaker 1: their number six oh eight four four two five six
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Speaker 1: three seven as mentioned. Joining us this morning are CJ.
0:48
Speaker 1: Closs and Nate Briby. CJ, how you doing this week?
0:52
Speaker 2: I'm doing great, Sean, how are you?
0:54
Speaker 1: I'm doing really well. Great to chat with you. Nate,
0:56
Speaker 1: welcome back. Great to have you along. How are you
0:57
Speaker 1: doing this morning?
0:58
Speaker 3: Good morning Sean.
1:00
Speaker 4: One great excellent.
1:01
Speaker 1: We've got this is this is we always have fun
1:05
Speaker 1: on this show and learn a lot, and.
1:08
Speaker 4: This week we've got it.
1:09
Speaker 1: As soon as I saw a toitle, like, oh, this
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Speaker 1: is going to be really interesting this week's ShW we're
1:13
Speaker 1: gonna be talking about the spirit versus the letter, which
1:15
Speaker 1: is why doing what's right isn't always the same as
1:18
Speaker 1: doing what's required. And we're going to get into this
1:21
Speaker 1: with cgnnight. It's a fascinating topic ahead. You're definitely going
1:24
Speaker 1: to want to pay close attention to this week's conversation
1:27
Speaker 1: not only for the great information and great conversation, but
1:29
Speaker 1: also you'll have a chance to win a little bit
1:31
Speaker 1: later on in the program with the Class Quiz Question
1:33
Speaker 1: the Week. This week our friends from Class Financial that
1:35
Speaker 1: provided a twenty five dollars gift card to Best Buy.
1:39
Speaker 1: Little tip and I'll tell you a little bit more
1:40
Speaker 1: on how you can win that, but a little tip
1:42
Speaker 1: to the Class Quiz Question of the Week. Listen closely
1:45
Speaker 1: because just about every week the question and answer to
1:47
Speaker 1: the Class Quiz Question the Week comes up during the program,
1:50
Speaker 1: and before we get to this week's philosophical question on
1:54
Speaker 1: the program. Let's actually roll back to last week's show
1:56
Speaker 1: and get the question and answer there as well.
1:58
Speaker 4: CJ.
2:00
Speaker 2: Yeah, so thanks to everyone for listening, and congrats to
2:03
Speaker 2: our winner from last week. So last week's question was
2:06
Speaker 2: a true or false. The question was recency bias when investing,
2:12
Speaker 2: is the tendency to place too much weight on recent
2:15
Speaker 2: market performance and assume it will continue into the future.
2:19
Speaker 2: And the answer to that question was true. Again, congrats
2:21
Speaker 2: to our winner from last week. And if you don't
2:24
Speaker 2: know what recency bias is, then just go back and
2:27
Speaker 2: listen to that show from last week.
2:28
Speaker 1: It was a really great program and you can listen
2:30
Speaker 1: to it right at classfinancial dot com. That's Closs Klaas
2:34
Speaker 1: Financial dot com. Well minds are open if you've got
2:36
Speaker 1: questions for CJ and Nate. Don't forget anything retirement related,
2:40
Speaker 1: whether it's about the topic at hand or anything about
2:42
Speaker 1: retirement planning. They'd love to talk to a number to
2:44
Speaker 1: get on the air. Six so eight three two one
2:46
Speaker 1: thirteen ten. That's six soh eight three two one thirteen ten.
2:49
Speaker 1: So CJ, as mentioned, this topic sounds very you know,
2:53
Speaker 1: philosophical when you think about like financial planning and other things.
2:56
Speaker 1: But I got a feeling this applies directly to how
2:59
Speaker 1: financial professionals operate. What do you mean by the spirit
3:03
Speaker 1: versus the letter?
3:05
Speaker 2: Yeah, good question, Sean. I think that's a good place
3:08
Speaker 2: to begin, given that it's the title of our topic today.
3:11
Speaker 2: So it's actually very practical. The letter of the law
3:15
Speaker 2: refers to doing exactly what regulations require, checking the boxes,
3:20
Speaker 2: following rules, meeting disclosure standards. The spirit of the law
3:25
Speaker 2: goes deeper. It asks what was the rule trying to
3:28
Speaker 2: accomplish in the first place. In financial services, you can
3:32
Speaker 2: technically comply with regulations and still fall short of doing
3:36
Speaker 2: what's truly best for a client. So a class financial
3:40
Speaker 2: our internal standard isn't just are we compliant, it's are
3:45
Speaker 2: we aligned with the intent of serving the client first?
3:49
Speaker 2: And that distinctionizes directly to our core value of integrity
3:53
Speaker 2: and our internal value of reducing conflicts of interests with
3:57
Speaker 2: our clients. Listen, everybody, I think you've heard this probably
4:00
Speaker 2: throughout your life as you live life, where somebody goes, ah,
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Speaker 2: you're too focused on the letter of the law instead
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Speaker 2: of the spirit of the law, And often people go
4:09
Speaker 2: what does that mean? What does that mean the letter
4:11
Speaker 2: of the law versus the spirit of the law.
4:13
Speaker 3: Right.
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Speaker 2: It's kind of like the person who goes, oh, the
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Speaker 2: speed limit is thirty miles an hour and you were
4:19
Speaker 2: going thirty one, how often you get pulled over? Right,
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Speaker 2: It's like, well, the spirit of that law is to
4:25
Speaker 2: try to keep the public safe. Right, that's the spirit
4:28
Speaker 2: of the law in particular areas. So if you're going
4:31
Speaker 2: thirty one and it's thirty you're not going to get
4:34
Speaker 2: pulled over by a police officer, right, even though the
4:36
Speaker 2: letter of the law says you're breaking the law.
4:40
Speaker 3: Right.
4:41
Speaker 2: So again the idea is instead of looking at regulations
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Speaker 2: in our industry through the lens of what can I
4:47
Speaker 2: do to adhere to the law, but then like get
4:50
Speaker 2: by right, we asked the question of what was the
4:52
Speaker 2: intent of this regulation? What was the intent of this
4:55
Speaker 2: law and how can we live it out to the
4:57
Speaker 2: fullest extent to make sure that our clients are are
5:00
Speaker 2: better off for it.
5:01
Speaker 1: Great groundwork laid there by mister CJ. Closs, of course,
5:04
Speaker 1: joined by CJ. And Nate Briby, our retirement planning professionals
5:07
Speaker 1: from Class Financially. If you've got a question, we've got
5:09
Speaker 1: a line for you six h eight three two one
5:11
Speaker 1: thirteen ten. That's six h eight three two one thirteen ten.
5:14
Speaker 1: The website for Coss Financial, it's cossfinancial dot com. You
5:17
Speaker 1: can also schedule I mentioned some of the grade features
5:19
Speaker 1: the website I didn't mention. You can schedule a complementary
5:21
Speaker 1: conversation right at coassfinancial dot com or pick phone give
5:24
Speaker 1: a call six oh eight four four two five six
5:27
Speaker 1: three seven. So, Nate, let's kind of make the rubber
5:30
Speaker 1: hit the road. So to say, let's get a real
5:32
Speaker 1: world example of how this may show up.
5:35
Speaker 5: Sure, let's let's look at disclosure. So regulations require that
5:39
Speaker 5: advisors disclose conflicts of interest things like compensation relationships or incentives.
5:45
Speaker 5: And that's important. But here's the difference.
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Speaker 3: The letter of the.
5:48
Speaker 5: Law says disclose the conflict. The spirit of the law says,
5:52
Speaker 5: why does the conflict exist? And can remove it or
5:56
Speaker 5: at least reduce it. Obviously, these are not the same thing.
6:00
Speaker 5: You could write a perfectly compliant disclosure buried in a
6:02
Speaker 5: document and technically meet the requirement while still allowing that
6:06
Speaker 5: conflict to influence decisions. At COSS Financial, we try to
6:09
Speaker 5: go further. If a conflict can be reduced or removed,
6:12
Speaker 5: we believe it should be. That's a higher bar than
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Speaker 5: simply disclosing it.
6:18
Speaker 1: And so as we look at that stuff, I think
6:21
Speaker 1: for a lot of people they think, go, well, that's
6:23
Speaker 1: that's kind of the same.
6:24
Speaker 4: That's very interesting.
6:25
Speaker 1: And you know, and CJ, I think of most of
6:28
Speaker 1: us that probably assume disclosure kind of solves the problem exactly.
6:33
Speaker 2: And that's that's where a real important gap exists between
6:36
Speaker 2: perception and reality. So disclosure is about transparency and it's
6:41
Speaker 2: not the same thing as eliminating risk or protecting the
6:44
Speaker 2: client from the conflict itself. And this shows up very
6:47
Speaker 2: clearly in documents like a firm's Form ADV and Form CRS.
6:51
Speaker 2: These are regulatory filings where firms are required to outline
6:54
Speaker 2: potential conflicts of interest things like revenue sharing, referral fees,
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Speaker 2: or compensation tied to certain products, which can directly influence
7:02
Speaker 2: what ends up in a client's portfolios. And here's the challenge.
7:06
Speaker 2: Most clients never read these documents, and even if they do,
7:09
Speaker 2: they're often written in highly technical language that can be
7:12
Speaker 2: difficult to interpret by lawyers who you don't know. So
7:16
Speaker 2: what can happen is this, A firm can fully comply
7:20
Speaker 2: with the letter of the law by disclosing dozens of
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Speaker 2: potential conflicts in their adv including things like revenue sharing arrangements,
7:29
Speaker 2: referral fees, or compensation tied to the sale of certain products,
7:33
Speaker 2: but those conflicts may not be actively discussed, simplified, or
7:36
Speaker 2: proactively explained to clients in a meaningful way. We run
7:40
Speaker 2: into this all the time. As I've gotten deeper into
7:43
Speaker 2: the industry that I serve and I am part of
7:46
Speaker 2: a leader of I've learned to read these documents. So
7:50
Speaker 2: I'll often come into meetings with other leaders while I say, Hey,
7:53
Speaker 2: I read your form ADV. What is XYZ LLC? What
7:57
Speaker 2: is that LLC? And they're like, what do you meet?
8:00
Speaker 2: And I'm like, well, it's talked about in in your
8:03
Speaker 2: form ADV. What is that LLC? And They're like, gosh,
8:05
Speaker 2: nobody's asked me that before. That's that's this third layer,
8:08
Speaker 2: you know, real estate company that I own that we
8:11
Speaker 2: sell some products to clients. Occasionally you get the idea,
8:14
Speaker 2: right you go, whoa, whoa. So these documents can be
8:18
Speaker 2: buried with meeting the letter of the law. I'm telling
8:23
Speaker 2: you all the things that we do that are in
8:25
Speaker 2: conflict with you. The question is whether or not as discussed,
8:29
Speaker 2: And that's what Nate's going to talk about here in
8:31
Speaker 2: a little bit, and I will as well. It's like
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Speaker 2: it's one thing to bury it in a document, it's
8:35
Speaker 2: another thing to actually say you should know.
8:38
Speaker 3: You should know that.
8:39
Speaker 2: Actually, here's some potential conflicts, and here's ways that we
8:43
Speaker 2: as an organization try to reduce or mitigate and final
8:46
Speaker 2: thought on this. Often people will say, why do you
8:49
Speaker 2: say reduce? Why don't you just say eliminate conflicts of interest?
8:52
Speaker 2: And here's why I love that utopian phrase. I actually
8:57
Speaker 2: often speak in utopian phrases. But the problem is that
9:01
Speaker 2: in the real world there's always some conflicts, and those
9:05
Speaker 2: conflicts should be disclosed, but more importantly, they should be
9:08
Speaker 2: known and discussed. One of those conflicts would be we
9:12
Speaker 2: get paid for giving you services, so I want you
9:14
Speaker 2: as a client, And people go, that's not a conflict there, Yes,
9:17
Speaker 2: it is. I literally have to disclose that I want
9:19
Speaker 2: you as a client because you're gonna pay me fees.
9:21
Speaker 2: You get my point. You cannot eliminate all conflicts. The
9:25
Speaker 2: question is how severe are they? Does it influence my
9:28
Speaker 2: advice to you you know, so on and so forth.
9:30
Speaker 1: And as CJ you just mentioned there, we're going to
9:31
Speaker 1: ask Ned Tod get a little bit more into this
9:33
Speaker 1: with Nan and I know you've got some got some
9:35
Speaker 1: more insight into this as well. Always a great conversation
9:38
Speaker 1: with our retirement planning professionals from Class Financial.
9:41
Speaker 4: Don't forget.
9:41
Speaker 1: If you missed part of the show, you want to
9:43
Speaker 1: listen back or you want to share it, just head
9:44
Speaker 1: on over to Clossfinancial dot com. That's coss k l
9:47
Speaker 1: a as financial dot com. From there you can listen
9:50
Speaker 1: back to this in previous shows podcast. You can also subscribe.
9:53
Speaker 1: You can learn more about Coss Financial right at the
9:55
Speaker 1: website or schedule a complimentary chat right from class financial
9:59
Speaker 1: dot com. That's claw OUs k l aas financial dot com.
10:02
Speaker 1: There telephone number six o eight four four two five
10:05
Speaker 1: six three seven that first to get to know you.
10:07
Speaker 1: Appoyment that conversation. It's going to be complementary to you.
10:09
Speaker 1: It's not going to cost you a thing again their
10:11
Speaker 1: number six oh eight four four two five six three seven.
10:14
Speaker 1: We'll continue our conversation with CJ n Nate next as
10:17
Speaker 1: Money in Motion with Coss Financial continues right here on
10:19
Speaker 1: thirteen ten, wuib I talking with our retirement planning professionals CJ.
10:24
Speaker 4: Closs and Nate Bribey.
10:26
Speaker 1: Of course they come to us from Colass Financial online
10:29
Speaker 1: class Financial dot com. That's COSS klaas Financial dot com.
10:33
Speaker 1: Great website to learn all about COSS financially. You can
10:36
Speaker 1: also schedule a complementary conversation right from the website, or
10:39
Speaker 1: you can give them a call their telephone number six
10:41
Speaker 1: oh eight four four two five, six three seven. Talking
10:44
Speaker 1: this week with cjn Nate about the spirit versus the
10:48
Speaker 1: letter and what that means in practice. And Nate, as
10:52
Speaker 1: we've been talking this morning, we talk about, you know,
10:55
Speaker 1: in a way the conflict. It may be disclosed on paper,
10:58
Speaker 1: but it is actually in visible in practice.
11:01
Speaker 4: Let's kind of elaborate and get into that.
11:04
Speaker 5: Yeah, And I think this speaks to to truly asking
11:07
Speaker 5: clients to ask their advisors more questions, especially when they're interviewing,
11:11
Speaker 5: you know, advisors and maybe starting their financial planning journey.
11:14
Speaker 3: And I'm just pulling.
11:15
Speaker 5: From our actual you know CR form CRS and looking
11:19
Speaker 5: at you know, asking your advisor what you know, what
11:22
Speaker 5: services and advice and would I get if I pay
11:25
Speaker 5: you and how much will I pay you?
11:27
Speaker 3: You know, how are you compensated? How do you make money?
11:29
Speaker 5: And those are very direct questions, but just so relevant
11:32
Speaker 5: and important. So and once again, the letter of the
11:35
Speaker 5: law says, as long as the conflict is disclosed and
11:38
Speaker 5: the proper documents, the requirement has been met. But the
11:41
Speaker 5: spirit of the law asks a harder question, has the
11:44
Speaker 5: client client client truly understood the conflict? And have we
11:48
Speaker 5: done everything we reasonably can to reduce its impact? So
11:52
Speaker 5: those are two very different standards, obviously, and at costs,
11:55
Speaker 5: we try to operate with a different mindset. We don't
11:58
Speaker 5: just ask where do we disclosed conflicts? We ask where
12:02
Speaker 5: do they exist in the first place?
12:04
Speaker 3: And why? And if the exist, we ask.
12:07
Speaker 5: Can they be reduced? Can they be eliminated? Should we
12:10
Speaker 5: be structuring things differently in the first place? In our experience,
12:14
Speaker 5: this is one of the biggest blind spots in the
12:15
Speaker 5: industry and most clients don't even realize it. And once again,
12:20
Speaker 5: ask your advisor, ask your firm.
12:22
Speaker 3: You know some of these questions.
12:23
Speaker 5: It's never a bad time to have the conversation, if
12:26
Speaker 5: you think about it. Disclosure documents like the adv are
12:29
Speaker 5: often a dozen pages long and I always joke with
12:32
Speaker 5: clients too when they're when they're giving these documents to them.
12:35
Speaker 3: This is all to.
12:36
Speaker 5: Make you a more informed consumer. And I think we
12:38
Speaker 5: can look at, you know, other industries such as mortgages.
12:41
Speaker 5: If you've refinanced or purchased a home recently, you know
12:44
Speaker 5: what I'm talking about. These are thirty or forty pages
12:46
Speaker 5: of regulatory documents that once again no one reads.
12:49
Speaker 3: That they're designed to.
12:50
Speaker 5: Make you a more informed consumer. So it is frustrating.
12:52
Speaker 5: This is where you really need to have those direct,
12:54
Speaker 5: you know, conversations with your advisor to really understand what
12:58
Speaker 5: you're signing and why those words are in the in
13:00
Speaker 5: the first place. Right. So and so it's entirely possible
13:03
Speaker 5: and actually quite common for a client to work with
13:05
Speaker 5: an advisor for years and never have a direct conversation
13:08
Speaker 5: about what's in that document. And CJ and I laugh
13:10
Speaker 5: sometimes when we work with new clients that are working
13:13
Speaker 5: with other advisors and say, why don't pay any fees?
13:15
Speaker 3: I don't know, you know, Jim's a good guy and
13:17
Speaker 3: I like him.
13:18
Speaker 5: Well, it's like, well, Jim has an office and a
13:20
Speaker 5: staff for a reason, right, There are some compensation involved
13:23
Speaker 5: so I think that's a good conversation to have, right,
13:26
Speaker 5: And again there's a difference between well it was disclosed,
13:29
Speaker 5: but we want to make sure that you actually understood
13:32
Speaker 5: what's in there. So finally, at costs, we believe the
13:35
Speaker 5: second standard is the one that actually builds trust making
13:37
Speaker 5: sure our clients understand what's in those documents.
13:42
Speaker 4: And CG.
13:42
Speaker 1: I know you had a little more, a little more
13:45
Speaker 1: that you want to add to.
13:46
Speaker 2: This, yeah, yeah, so one more layer to this, you know,
13:49
Speaker 2: on top of what Nate is saying is if a
13:51
Speaker 2: conflict is significant enough that it needs to be disclosed
13:54
Speaker 2: in a regulatory document, then in our opinion, it's significant
13:57
Speaker 2: enough that it should be explained in plain English in
13:59
Speaker 2: a client conversation. Now you know, full disclosure here is
14:04
Speaker 2: it relates to the form ADV in form CRS. As
14:07
Speaker 2: a matter of fact, form CRS, which Customer Relationship Summary
14:12
Speaker 2: I believe is kind of what that acronym stands for.
14:15
Speaker 2: That document was designed to be a more plane English,
14:19
Speaker 2: single page document, so legitimately it used to be just
14:24
Speaker 2: go read the ADV that was, you know, fifteen twenty
14:26
Speaker 2: thirty pages long. The regulatory body, the Securities and Exchange Commission,
14:31
Speaker 2: recognized like it's just too complicated. Nobody's reading this thing,
14:34
Speaker 2: so how can we help? And that's where the form
14:37
Speaker 2: CRS came out. So the good news is the regulatory
14:40
Speaker 2: environment is iterating for the way that consumers are or
14:43
Speaker 2: are not actually reading these documents, but hear what I said.
14:48
Speaker 2: If it's significant enough to be in the documents, in
14:50
Speaker 2: our opinion, should be explained in plane English in a
14:53
Speaker 2: client conversation, so not in plane document, but in plane English.
14:58
Speaker 2: So this is part of our on boarding of prospecting
15:01
Speaker 2: with meeting meeting people for the first time. We say, hey,
15:03
Speaker 2: here's some things you should know about us, how long
15:05
Speaker 2: we've been in business, how we get paid, conflicts that
15:08
Speaker 2: might potentially exist between us and you. So the idea
15:11
Speaker 2: is that these things are not hidden in fine print,
15:14
Speaker 2: they're not buried in legal language, but clearly discussed with context,
15:18
Speaker 2: because at the end of the day, the goal isn't
15:20
Speaker 2: just compliance, it's alignment. And that's in our opinion, where
15:25
Speaker 2: the spirit of the law really really comes to life.
15:27
Speaker 1: And Nate, let's bring you in on that aspect as well.
15:31
Speaker 1: We talk about some of the external stuff and meeting
15:33
Speaker 1: with prospective clients. What about internally, How does this how
15:36
Speaker 1: does this show up inside Class Financial?
15:40
Speaker 5: Yeah, I'm going to still want to see Jay's favorite
15:42
Speaker 5: lines here. But incentives drive behavior and they just do so.
15:45
Speaker 5: I mean, if advisors are rewarded for gathering assets at
15:48
Speaker 5: all costs, behavior will follow. If advisors are rewarded for
15:52
Speaker 5: products sales, behavior will follow. So those structures can technically
15:57
Speaker 5: comply with regulations but still create pressure that works against
16:00
Speaker 5: the client's best interests. So again the letter says the
16:03
Speaker 5: structure has followed, the spirit asks whether the structure promotes
16:07
Speaker 5: the right outcomes, and so we're constantly evaluating that tension
16:10
Speaker 5: and making sure we're doing the right thing.
16:12
Speaker 3: Here at COSS.
16:13
Speaker 4: Talking this morning with CJ Closs and Nate Briby.
16:15
Speaker 1: They are retirement planning professionals from Class Financial Online, Cossfinancial
16:19
Speaker 1: dot com. That's COSS k l a a s Financial
16:22
Speaker 1: dot com talking about the spirit versus the letter when
16:24
Speaker 1: it comes to when it comes to the application of
16:29
Speaker 1: working with the financial advisor. We're going to continue our
16:31
Speaker 1: conversation with Nate and CJ. We'll talk a little bit
16:34
Speaker 1: more about about kind of how you as a as
16:37
Speaker 1: a perspective client and working with Class financial, how you
16:43
Speaker 1: evaluate that some of the questions. We'll get those details
16:45
Speaker 1: from CJ.
16:45
Speaker 5: N E.
16:45
Speaker 1: We will do that next as Money in Motion with
16:48
Speaker 1: Class Financial continues right here on.
16:49
Speaker 4: Thirteen ten doll will you y? I talking this week
16:52
Speaker 4: with CJ.
16:52
Speaker 1: Closs and Nate Bribe, our retirement planning professionals from Cross
16:56
Speaker 1: Financial the website coss Financial dot com. That's k L
16:59
Speaker 1: A A S Financial dot com and they're teleph number six.
17:01
Speaker 1: So eight four four, two, five, six three seven, talking
17:04
Speaker 1: about why doing the right thing isn't always the same
17:07
Speaker 1: as doing what's required and CJ. Obviously this is something
17:11
Speaker 1: that's really important and I think a lot of us
17:13
Speaker 1: care about, but it does seem hard to evaluate from
17:16
Speaker 1: the outside. How can someone tell, like, what should we
17:19
Speaker 1: be doing or how should we be approaching this?
17:22
Speaker 2: It's a great point, Sean. So again, I mentioned earlier
17:25
Speaker 2: that speaking in utopian terms sounds really nice, but it's
17:30
Speaker 2: it's hard in practice. So truth be told, you know,
17:33
Speaker 2: to find a firm that has no conflicts with you
17:36
Speaker 2: actually is probably darn near impossible. The question is what
17:40
Speaker 2: are those conflicts, How significant are they Are they going
17:43
Speaker 2: to impact my experience with this firm or create a
17:47
Speaker 2: conflict that I'm just not willing to have in place.
17:50
Speaker 2: So an example of this that we often see is
17:52
Speaker 2: again a separate entity inside of another firm that actually
17:56
Speaker 2: maybe sells real estate, or another entity inside of a
17:59
Speaker 2: firm that's ells commissionable products or annuities. You know, it's like, oh,
18:04
Speaker 2: I thought I was working with a fiduciary and they
18:05
Speaker 2: said they're a fiduciary, But it turns out all over
18:08
Speaker 2: inside of the adv or the form CRS it seems
18:10
Speaker 2: to indicate something else. And so this isn't necessarily about,
18:17
Speaker 2: you know, making things perfect. It's about understanding the severity
18:21
Speaker 2: of those potential conflicts. So in practice, though, Sean, you're correct,
18:27
Speaker 2: what does this look like? So this is where our
18:29
Speaker 2: core value of curiosity comes into play. So here's three
18:33
Speaker 2: simple questions every listener can ask and probably should ask
18:37
Speaker 2: their advisor. Number one, do you aim to minimize conflicts
18:42
Speaker 2: or just disclose them? By the way, as you can imagine,
18:46
Speaker 2: that's going to put somebody on their heels a little bit,
18:48
Speaker 2: But they're if they're interested in disclosing things. I let
18:53
Speaker 2: me give an example. If you ask me that question,
18:55
Speaker 2: I would get giddy. I'd be like, what a great question,
18:59
Speaker 2: Oh my gosh, and I would show them the form
19:02
Speaker 2: CRS and I would say, great, qu's here's some of
19:05
Speaker 2: those things that we talked about, and here's why, because
19:07
Speaker 2: I would think to myself, what a great question, What
19:10
Speaker 2: a great question. Number two, how does your firm's compensation
19:14
Speaker 2: structure influence recommendations?
19:17
Speaker 4: Oh my gosh, what.
19:18
Speaker 2: Another great question. Right, It's like, how do you compensate
19:21
Speaker 2: your advisors? Because my concern is if you compensate them
19:25
Speaker 2: on like growth of sales, then I might run into
19:27
Speaker 2: a situation where I'm working with the fuciary who's supposed
19:30
Speaker 2: to be giving me advice, but it feels like I'm
19:31
Speaker 2: working with a used car salesman.
19:33
Speaker 3: Right.
19:36
Speaker 1: As CJ, as we talked this morning as well with
19:39
Speaker 1: CJ Closs and Nate Briby, are retirement planning professionals from
19:42
Speaker 1: Class Financial, And as CJ laid that out Nate, it
19:46
Speaker 1: makes so much sense and kind as we take it
19:48
Speaker 1: down the home stretch this morning, what's kind of the
19:50
Speaker 1: big takeaway name?
19:52
Speaker 5: Yeah, I would echo what CJ said, you know, ask questions,
19:55
Speaker 5: and I'm with J. I love I love the questions
19:58
Speaker 5: directly from clients direct clients, how do you get you know?
20:00
Speaker 5: What are your fiduciary? Are you feel only what services
20:02
Speaker 5: are we getting?
20:03
Speaker 3: Like?
20:03
Speaker 5: Those are great questions because I feel great about you know,
20:06
Speaker 5: our services, our value proposition and cost financial is affirm
20:09
Speaker 5: But to wrap it all up, I would say, don't confuse.
20:12
Speaker 3: Compliance with alignment.
20:14
Speaker 5: Compliance is essentially the floor, but trust is built above
20:17
Speaker 5: that floor. So the best advisors don't just follow the rules.
20:21
Speaker 5: They embrace the purpose behind them. So doing it right
20:24
Speaker 5: for the client should never depend on what's required.
20:26
Speaker 3: It should define it.
20:28
Speaker 5: That's the difference between following the rules and honoring the responsibility.
20:32
Speaker 5: A fiduciary relationship is grounded in curiosity, integrity, and empathy.
20:36
Speaker 5: Doesn't stop at the letter of the law. It strives
20:39
Speaker 5: to live out the spirit of the law. If you'd
20:42
Speaker 5: like help evaluating current situation or simply want a second opinion,
20:45
Speaker 5: our team is always here to help.
20:46
Speaker 1: A great show and so much great information this morning.
20:49
Speaker 1: Really kind of a deep understanding as well about how
20:52
Speaker 1: things work at COSS Financial. It's a great way to
20:55
Speaker 1: start that conversation, a little get to know you if
20:57
Speaker 1: you head on over to cossfinancial dot com. That's cost
21:00
Speaker 1: klaas Financial dot com. You can start a complementary conversation
21:04
Speaker 1: right from the website. You can also learn all about
21:06
Speaker 1: COSS Financial, the team, their separate division, learn about learn
21:10
Speaker 1: a little bit about how they operate and how they work.
21:12
Speaker 1: Also great opportunity if you've got a question you could
21:14
Speaker 1: submit to the Money in Motion listener question corner. You
21:17
Speaker 1: can do that right from Cossfinancial dot com. That's Coss
21:20
Speaker 1: k l Aasfinancial dot com. And again don't free. You
21:23
Speaker 1: can set up that complementary conversation right from the website,
21:26
Speaker 1: or you can call the office right here in Madison
21:28
Speaker 1: at six oh eight four four two five six three seven.
21:31
Speaker 1: No charge for that initial get to know your appointment
21:33
Speaker 1: at Coss Financial. It will be complementary to you. Again
21:36
Speaker 1: their number six oh eight four four two five six
21:38
Speaker 1: three seven. Speaking of the telephon number for Class Financial
21:41
Speaker 1: office right here in Madison, I want to hold on
21:42
Speaker 1: to that because it's time now for the Coss Quiz
21:44
Speaker 1: Question of the Week. It works like this. In just
21:46
Speaker 1: a moment, I'll ask you the Class Quiz question of
21:48
Speaker 1: the week. You will then have thirty minutes from the
21:50
Speaker 1: ter today's program to call the Class Financial office right
21:52
Speaker 1: here in Madison at six oh eight four four two
21:55
Speaker 1: five six three seven, And if you are the first
21:57
Speaker 1: call up with correct answer, you will win this week's prize,
21:59
Speaker 1: which day twenty five dollars gift card to best Buy.
22:03
Speaker 1: This week's COLSS quiz question the week is this true
22:06
Speaker 1: or false? If a conflict of interest is disclosed, it
22:10
Speaker 1: has effectively been solved. Telephone number six soh eight four
22:14
Speaker 1: four two five six three seven, first callth correct answer
22:17
Speaker 1: when that twenty five dollars gift card to cost Financial
22:20
Speaker 1: And again that's Class Financials office right here in Madison.
22:22
Speaker 1: No charge for that initial gets to know the appoyment
22:24
Speaker 1: TCH COLSS Financial. It will be complimentary to you always,
22:27
Speaker 1: great stuff. CJ Nate, you guys, enjoy this beautiful Dan.
22:30
Speaker 1: We'll do it all again real soon.
22:32
Speaker 3: Thanks Sean, Thanks Sean.
22:34
Speaker 4: Take care, guys.
22:35
Speaker 1: News comes your way next right here on thirteen ten WIBI.
22:39
Speaker 1: This is Money in Motion with COSS Financial Asset Advisors, LLC,
22:43
Speaker 1: a registered investment advisor registered with the SEC.
22:47
Speaker 4: The contents of this show are.
22:48
Speaker 1: For informational purposes only and should not be considered individual
22:52
Speaker 1: investment advice. Class Financial does not offer tax or legal advice.
22:56
Speaker 1: Any opinion offered during the course of this show is
22:59
Speaker 1: the opinion of that particular investment advisor representative, and not
23:03
Speaker 1: necessarily the opinion of cost Financial