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A few weeks ago, in my column Trust you? Why?, I suggested a number due-diligence check points before selecting a financial advisor.

But there’s another critical element that I urge all of my prospective clients to look into before entrusting their plans, hopes and dreams to another person:

What financial services company stands behind the financial advisor?

Why we chose Raymond James Financial

As an entrepreneurial, client-centric wealth management firm, our focus is on building long-term, close personal relationships based on integrity and earned trust.

That is Raymond James’ attitude as well.

As a diversified financial services company with $725 billion in client assets, Raymond James ranks among the nation’s premier providers of investment and wealth planning resources.

It provides its affiliated firms—GDS Wealth Management, I’m proud to say, among them—with industry-leading support, superior client service, and comprehensive financial planning and investment resources.

Yet, for its size and scope, the company remains true to its founder’s vision: When you work with a Raymond James financial advisor, your investment strategy and well-being will be at the forefront.

And they keep that promise by ensuring we have the independence to serve our clients’—not the company’s—best interests.

In other words, your success is their success.

Not all financial services companies are created equal

Unlike Raymond James Financial, some “wire houses”—a term that describes broker-dealer firms ranging in size from small regional brokerages to large institutions with global footprints—have policies that can restrict its affiliates’ independence.

For instance, a wire house may require affiliates to place a percentage of client assets in proprietary products, whether those products support an individual’s overall investment strategy or not.

In a sense, then, the advisor works for the company, not the client.

And if your investments are in the wrong place simply to fill a company-mandated quota, which could potentially cost you a lot of money over the long term.

Another policy some wire houses cram down on their affiliates could cost you a trusted relationship.

How?

During your due diligence, simply ask prospective advisors, “What would happen if you terminate your relationship with your financial services company? Can I go with you, or will I remain a client of the wire house?”

That’s right. Some wire houses force affiliates who leave to abandon their clients.

How does that sound?

Benefit from a culture of independence

Raymond James’ is committed to supporting its affiliates while at the same time allowing them the latitude to work closely with clients to create custom solutions to your short- and long-term financial challenges.

As far as I’m concerned, that’s the gold standard when it comes to financial services support for affiliates and investors.

And it’s a standard you should insist on when selecting your financial advisor.

Glen D. Smith
CFP®, CRPC® | Chief Executive Officer | Chief Investment Officer | Cofounder

GDS Wealth Management is not a registered broker/dealer and is independent of Raymond James Financial Services. Securities offered through Raymond James Financial Services, Inc., Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Any opinions are those of Glen D. Smith and not necessarily those of RJFS or Raymond James.

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