Welcome to O'Brien Financial Planning
What is the Difference Between a Registered Representative and an Investment Adviser Representative?
In today's increasingly complex world of financial services, fewer people are seeking the types of services performed by the traditional Registered Representative (RR). People are no longer simply looking for someone to process their trades and orders. Rather, they seek true insight, sound advice, and valuable financial guidance. That's why many people are enlisting the services of Investment Adviser Representatives (IARs), which, in simplest terms, means that they:
This is a fundamental shift in the client-rep relationship that people appreciate because it closely ties their representative's compensation with the success of their investment strategy, rather than on the number of transactions made. While it is possible to be both an RR and an IAR, there are important differences in the two roles.
For starters, an IAR is an individual who performs services, such as providing advice, on behalf of an Investment Adviser Firm that is licensed/registered with the state or the SEC (depending mostly on asset thresholds). IARs must be registered or licensed pursuant to the laws of their resident state. This normally requires the appropriate NASD registrations, such as Series 7 and 65, etc. and/or an advanced industry designation such as a CFP®. What's more, an IAR must hold the client's interests above his or her own in all matters, and conflicts of interest must be avoided at all costs. However, there are some conflicts that will inevitably occur, such as a person being a Registered Representative of a broker/dealer as well as an IAR. In these instances, the IAR must make extra efforts to clearly and accurately describe those conflicts and how the IAR will maintain impartiality in his recommendations to clients. In addition, the SEC has made it clear that an IAR has a duty to:
Finally, the most important duty of an IAR is the disclosure of all information relating to the relationship between the IAR and the client. This information is part of the disclosure documentation provided to every client of O'Brien Financial Planning, which clearly delineates the details of the advisory relationship and other business interests of the IAR, and is provided to the client prior to, or at the time that the client enters into the contract/product, and absolutely no later. Top
What is an Accredited Investment Fiduciary?
The Accredited Investment Fiduciary® (AIF) designation represents a thorough knowledge of and ability to apply the Global Fiduciary Standard of Excellence.
The Standard of Excellence is based on the fiduciary Practices developed by the Foundation for Fiduciary Studies. AIF designees have received comprehensive instruction on the Practices and the legal and best practice framework they are built upon. AIF designees have a reputation in the industry as being the best positioned to implement a prudent process into their own investment practices as well as being able to assist others in implementing proper policies and procedures.
Expertise in this area is critical in today's fiduciary landscape. All investment industry scandals have one common thread: A fiduciary parlayed their position of trust for personal profits. "Breach of fiduciary responsibility" is the leading cause for arbitration against brokers, and the leading cause for civil and regulatory suits against RIAs. ERISA litigation has increased at a rate of 25% per year over the past four years. Pre-Enron, the burden of proof was on the plaintiff to show that you were a fiduciary. Today, the presupposition is that you are a fiduciary until you demonstrate otherwise.
Investment fiduciaries are constantly exposed to legal and practical scrutiny - it comes from multiple directions and for various reasons. It is likely that complaints and/or lawsuits alleging investment mismanagement will continue to increase. Although some of these allegations may be entirely justified, most can be avoided by being aware of who constitutes a fiduciary and what is required of one.
The AIF training and designation help mitigate this liability by instructing in practices that cover pertinent legislation and best practices. For this reason the AIF was named one of the "Ten Most Wanted" designations in the investment industry by Financial Planning magazine.
Once accredited, AIF designees have the following obligations:
These requirements are intended to provide a reminder of the integrity of the designation and ensure designees are continually improving their knowledge and quality of service. Top
Accredited Investment Fiduciary® Code of Ethics
I recognize that this Code of Ethics, and its principles and obligations, are in addition to those set forth by any other Code that governs my professional and ethical conduct.
To my clients, I will:
To my community (whether defined by work, family, and/or friends), I will:
What are Separately Managed Accounts?
A separately managed account is a personally targeted approach to investing in which the investor owns individual stock positions-unlike a mutual fund that pools each investor's assets into one shared fund. Separate Accounts also offer you many advantages such as:
Consistency: Through a consistent philosophy and mandate, the stocks stay within a rigid discipline so that your portfolio stays on target.
Enhanced fee structure: All costs are transparent as trading costs are usually included in the annual fee. You will also receive breakpoints for larger accounts.
Institutional Management: You will receive access to expertise and stocks recommended by institutional investment firms that normally require millions to invest.
Transparency: You are able to view your holdings daily with 24 hour access to account information and values.
Enhanced After-Tax Performance: The portfolio structure provides for more flexibility than mutual funds to manage potential tax consequences and conduct tax loss harvesting. The cost basis starts on the securities purchase date, so there are no embedded capital gains of expenses from other shareholders.
What does this mean to an investor?
What is a CFP®?
CFP®, CERTIFIED FINANCIAL PLANNER™ and are certification marks owned by Certified Financial Planner Board of Standards Inc. (CFP Board), which can help you identify financial planners who are committed to competent and ethical behavior when providing financial planning. Individuals certified by CFP Board have taken the extra step to demonstrate their professionalism by voluntarily submitting to the rigorous CFP® certification process that includes demanding education, examination, experience and ethical requirements. These standards are called “the four Es,” and they are four important reasons why the financial planning practitioner you select should display the CFP® certification marks.
Excerpt from the CFP® Code of Ethics
These Code of Ethics’ Principles express the profession’s recognition of its responsibilities to the public, to
clients, to colleagues and to employers. They apply to all CFP Board designees and provide guidance to
them in the performance of their professional services.
Principle 1 – Integrity
A CFP Board designee shall offer and provide professional services with integrity.
As discussed in “Composition and Scope,” CFP Board designees may be placed by clients in
positions of trust and confidence. The ultimate source of such public trust is the CFP Board
designee’s personal integrity. In deciding what is right and just, a CFP Board designee should
rely on his or her integrity as the appropriate touchstone. Integrity demands honesty and
candor which must not be subordinated to personal gain and advantage. Within the characteristic
of integrity, allowance can be made for innocent error and legitimate difference of
opinion; but integrity cannot co-exist with deceit or subordination of one’s principles.
Integrity requires a CFP Board designee to observe not only the letter but also the spirit of
this Code of Ethics.
Principle 2 – Objectivity
A CFP Board designee shall be objective in providing professional services to clients.
Objectivity requires intellectual honesty and impartiality. It is an essential quality for any professional.
Regardless of the particular service rendered or the capacity in which a CFP Board
designee functions, a CFP Board designee should protect the integrity of his or her work,
maintain objectivity, and avoid subordination of his or her judgment that would be in
violation of this Code of Ethics.
Principle 3 – Competence
A CFP Board designee shall provide services to clients competently and maintain the
necessary knowledge and skill to continue to do so in those areas in which the CFP Board
designee is engaged.
One is competent only when he or she has attained and maintained an adequate level of
knowledge and skill, and applies that knowledge effectively in providing services to clients.
Competence also includes the wisdom to recognize the limitations of that knowledge and
when consultation or client referral is appropriate. A CFP Board designee, by virtue of having
earned the CFP® certification, is deemed to be qualified to practice financial planning.
However, in addition to assimilating the common body of knowledge required and acquiring
the necessary experience for certification, a CFP Board designee shall make a continuing
commitment to learning and professional improvement.
Principle 4 – Fairness
A CFP Board designee shall perform professional services in a manner that is fair and reasonable
to clients, principals, partners and employers, and shall disclose conflict(s) of interest in
providing such services.
Fairness requires impartiality, intellectual honesty and disclosure of conflict(s) of interest. It
involves a subordination of one’s own feelings, prejudices and desires so as to achieve a
proper balance of conflicting interests. Fairness is treating others in the same fashion that
you would want to be treated and is an essential trait of any professional.
Principle 5 – Confidentiality
A CFP Board designee shall not disclose any confidential client information without the specific
consent of the client unless in response to proper legal process, to defend against
charges of wrongdoing by the CFP Board designee or in connection with a civil dispute
between the CFP Board designee and client.
A client, by seeking the services of a CFP Board designee, may be interested in creating a
relationship of personal trust and confidence with the CFP Board designee. This type of relationship
can only be built upon the understanding that information supplied to the CFP
Board designee will be confidential. In order to provide the contemplated services eff ectively
and to protect the client’s privacy, the CFP Board designee shall safeguard the confidentiality
of such information.
Principle 6 – Professionalism
A CFP Board designee’s conduct in all matters shall reflect credit upon the profession.
Because of the importance of the professional services rendered by CFP Board designees,
there are attendant responsibilities to behave with dignity and courtesy to all those who use
those services, fellow professionals, and those in related professions. A CFP Board designee
also has an obligation to cooperate with fellow CFP Board designees to enhance and maintain
the profession’s public image and to work jointly with other CFP Board designees to
improve the quality of services. It is only through the combined efforts of all CFP Board
designees, in cooperation with other professionals, that this vision can be realized.
Principle 7 – Diligence
A CFP Board designee shall act diligently in providing professional services.
Diligence is the provision of services in a reasonably prompt and thorough manner. Diligence
also includes proper planning for, and supervision of, the rendering of professional services. Top
The aforementioned material is a product or service listing and is not intended to be an offer for the sale of securities products. Securities are subject to investment risk and values will fluctuate.
Neither Tower Square Securities, Inc. nor it's representatives offer tax planning or legal advice. Please consult with your attorney or accountant before finalizing or implementing any tax planning or legal strategy. Securities and Investment Advisory Services offered through registered representatives and financial advisors, respectively, of Tower Square Securities, Inc., a securities broker/dealer (member FINRA/ SIPC) and a Registered Investment Adviser.
O'Brien Financial Planning is a separate entity from Tower Square Securities, Inc., and is not a securities broker/dealer or Registered Investment Adviser. David O'Brien is licensed in the states of New York, New Hampshire and Virginia for the sale and solicitation of securities and insurance products.
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