Jonathan Dash Jack Waymire

5 Steps for Selecting the Best Financial Advisor: Jonathan Dash and Jack Waymire

Jonathan Dash Jack Waymire

Your financial future requires more than just good luck. It takes the specialized expertise of a competent, ethical advisor who can help you achieve your financial goals and your first step on this road to retirement is selecting the right financial advisor. Jack Waymire and Jonathan Dash of Dash Investments are here to help, as the coauthors of 5 Steps for Selecting the Best Financial Advisor.

Now, this may sound like an easy task, but it’s actually fraught with risk. That’s because there are great advisors you should select and bad advisors you need to avoid. You have to know the difference in order to make the right selection. That difference could mean retiring comfortably or potentially being broke.

After decades in the financial service industry. Jack and Jonathan have seen countless investors make the wrong advisor choices that were based on slick sales pitches instead of characteristics that actually matter. That’s what this episode is about. It’s how to level the playing field between Wall Street and main street.

Jack Waymire: It basically started in the late 1990s when everybody was making a ton of money in the stock market, as long as they were invested in technology and communications stocks.

I happen to be the president of a money management firm in northern California, and then you have the stock market crash that basically ran from 2000 to 2002. Lots of friends lost 50 to 65% of their assets starting this crash, because the financial advisors that they were utilizing gave them really bad advice. They were way over weighted in technology stocks rather than a more diversified portfolio.

“It absolutely wrecked any thoughts they had of retiring in the next few years.”

Based on that experience, I decided to write a book titled Who’s Watching Your Money. This book happened to come out in 2003.

At that point, I was the president of Sun Guard Company, a subsidiary of Sun Guard ,and I decided to leave to really promote the book. We created a website that really was based on the principles and this book titled Who’s Watching Your Money.

Almost immediately, because we got a lot of promotion tied to the book, we started getting a lot of traffic on the website. A lot of the investors that were hitting the website were saying, “FD you know any vetted advisors in my community?”

So we basically built a registry of about 360 vetted advisors that we rolled out about six months after the initial launch of the first website. And so we ended up kind of a website that educated investors about advisors and then we helped investors select advisors based on credentials, ethics and business practices.

Jack Waymire: Then, over the last few years, what we began to see was a huge impact, the internet, everybody’s read the stories about how Amazon has impacted bookstores. What we started to see was a lot of the internet was having a big impact.

What the internet was doing was giving investors access to public data about financial advisors that they never had access to before. And actually, some of that data was already out there but the investor did not know that. Because the investors did not have access to public data going back several years, that allowed Wall Street to come in and dominate the process so that a lot of investors ended up hiring the best salesman versus the best advisor.

“We think that the internet is a game changer.”

If the investor knows where to go to look, they have the ability now to go out and research advisors, identify the advisors they want to talk to and they can maintain their anonymity while they do that. So they only talk to the people they want to talk to.

The genesis of the second book is basically teaching investors how to use the internet to protect their own financial interests. And these would be the investors who are going to turn their assets, their decision making over to a financial advisor.

Because every advisor in America either influences or controls the financial decisions of their clients. You want to make very sure you’ve hired the right advisor, and the internet is now the investor’s door to a lot of public data that will help them select the right advisor, help them avoid bad advisors.

But the bottom line is, they have to know where to look, they have to know what to look for and they have to know how that information impacts them. That’s the reason we wrote the second book.

How to Choose an Advisor

Charlie Hoehn: Before I kind of give the floor to you Jonathan, to tell your story, Jack, I’m curious, what do you say to the person who is thinking, “All I need to do is find somebody with a bunch of three letter acronyms after their name, right?”

Jack Waymire: You might wish it was that simple, but it’s not. Let me give you an example about the three letters. Paladin has gone out and validated 260 credentials that are used by financial advisors, and roughly 35% of them are fake.

Either the company that produced the credential has gone out of business or the advisor paid money to acquire the credential without doing any real study, without taking any meaningful test.

First thing the investor has to understand is that there are 650,000 salesmen out there trying to get in control of their assets, because that’s how they make their living. I can have access to the internet, that’s not the issue.

“Where do I go on the internet to find information?”

Something might be as basic as go visit the advisor’s website and see what you think. I mean, do they practice transparency or are you getting the information you need?

You might Google search the advisor’s name to see what pops up, or you might go a little deeper. There are regulatory agencies that you can access electronically. Look at the advisor’s compliance record. I would do that as almost a mandatory step to make sure you’re selecting an ethical financial advisor.

And then if you want to take it a step deeper, you can go in to the SEC’s records and look up the advisor’s firm and learn more about them that way.

So it just depends on how much time the investor’s willing to commit. At the same time, when you think about it, when they’re accumulating assets for retirement, the advisor they select is going to impact when they retire, how they live during retirement, and their financial security late in life.

I would submit that those are all three pretty important considerations. For that investor to spend 30 minutes researching an advisor before they interview them and they’re using that information during the interview to make sure you’re selecting an advisor that’s high quality and the way you would measure an advisor would be based on credentials.

For example, experience, education, certifications but only legitimate certifications. You look at their ethics, do they have a history of complaints, do they have suspensions on their record, do they have any actions by companies they used to work for.

“The bottom line is the business practice.”

How are they compensated, how do they communicate, what kind of services do they deliver? I think most investors are a little bit like the preverbal deer on the headlights because they’ve all read this headlines in their newspaper about the biggest firms on Wall Street paying billion dollar fines for ripping off their clients. Then the investor goes out and says, “I need a financial advisor.”

It’s a pretty scary proposition.

Because, am I hiring the guy with the best sales skills or am I hiring the guy with the best qualifications? I mean, that’s what it’s all going to boil down to for the investor.

Charlie Hoehn: Now, Jonathan, tell me quickly how you got involved in this book as well?

Jonathan Dash: Yeah, great. I saw a need out there, my firm handles assets for hundreds of families and we meet with new families every month. Time after time, people that we meet with, it could be in their mid-50s to early 60s and we’ll look at the way their assets had been managed the previous 10 or 15 years, and we just see the quality of management that they’ve had, the quality of advisor they had could have been so much better.

“It could have impacted their retirement in such a huge way.”

When you meet with someone to say hey, if this guy had a better advisor over the last 10 or 15 years, he might not have to sell his house when he turns 75, which they love so much and would rather not do or they could travel as much as they wanted to and always had planned to when they were younger.

It was just the advisor that they chose has such a big impact on how the retirement is going to turn out that it just dawned on me how important this decision is.

The Biggest Risk to Your Investment

Charlie Hoehn: Do you think there is another Madoff out there right now?

Jack Waymire: You know, the reason we started with a first chapter about Madoff is, I mean, Madoff is a historical criminal. I mean, it’s like Jesse James in modern times, to the extent that he damaged people somewhere between 50 and 65 billion dollars. People have committed suicide because of his theft that he perpetrated on their assets.

Let’s just say he’s kind of a historical figure, there may not be another Madoff based on magnitude but almost every single month, you see new Ponzi schemes being uncovered by the regulatory agencies.

The scams are still out there. I mean, it’s kind of like, the old adage about why do you rob banks? Because that’s where the money is.

Nowadays, you know, a modern thief might want to rob a retiree because he has the most assets. That risk is extremely real.

It may not be the magnitude, the whole idea of starting with Madoff was to get people’s attention. Then the bottom line is, there’s not another Madoff based on magnitude, but there are a lot of small Madoffs.

The five million, 10 million, $20 million Ponzi schemes that if you happen to get snared by one, you could still lose all of your money even though it wasn’t a Madoff type.

The bigger issue is not so much the thieves, which is what a Madoff was. I mean, a hundred years in prison kind of tells you a little bit about the magnitude of his crimes.

“You don’t have necessarily as many thieves as you just do bad advisors.”

Because one of your risks is you hire a Bernie Madoff type and he steals your money. What about the non-Madoff type that just gives you really bad advice and sells you really expensive products? And the lower the quality of the product, the more commission they pay.

It’s like Jonathan said, you could have retired with a lot more money. Unfortunately, you got really bad advice.

The impact is the advisor makes a lot of big commission dollars, your assets are performing lower than they should be. Therefore, you retire with less money, that’s the real message of chapter one.

It’s not that there is, you have to worry so much about a Madoff as you should be worrying about, “Do I have the right advisor, am I getting competitive advice, am I going to be able to achieve by goals for a secure comfortable retirement?”

The real risk is in bad advice, I would say that’s the biggest risk. The second biggest risk is you actually do have somebody who is unethical and is doing unethical things. You might have a few thousand unethical advisors out there, ripping off their clients. You may have two or 300,000 advisors who are giving their clients bad advice because it’s a way for them to maximize their own income.

That’s where the bigger risk is, it’s with bad advice.

The Role of Regulators

Charlie Hoehn: I have a question about that which is don’t regulators, don’t they want to protect investors from these bad advisors?

Jack Waymire: Let me answer it this way. There’s three core regulatory agencies. FINRA which regulates the brokerage, stock brokerage industry, the SEC which regulates the financial services industry and then you’ve got the state securities and insurance commissioners.

FINRA which is the brokerage industry, FINRA is basically owned and controlled by Wall Street, all of the money that is – goes into running FINRA comes pretty much from Wall Street so FINRA is called an SRO. Self-regulatory agency.

Wall Street is regulating Wall Street. If you go over to the SEC. The SEC is controlled by politicians and I don’t know what the exact number would be, I’ve heard numbers all over the map, but Wall Street spends tens of millions of dollars on lobbyists to influence the rules that apply to financial advisors and their stock brokers.

Most recently, you saw how they diluted and virtually killed the whole fiduciary rule with the department of labor. That was all Wall Street money lining the pockets of enough politicians that they could get that rule killed.

Because if Wall Street can’t kill a rule, then the next step is diluted so it has no teeth and delay it as long as possible. They’ve been doing that, going back to 2010.

From a regulatory perspective, the states are all kind of 20 years behind the time, they don’t even have online databases in a lot of cases.

“To say there’s no effective regulatory agencies, I think is a fair statement.”

The other thing to say is that, frequently, like the SEC, they would view themselves more as enforcement. When you think about, they caught Bernie Madoff…no, Bernie Madoff turned himself in.

Therefore, he had active securities licenses. So FINRA says this guy is okay. He had active advisor licenses, the SEC said this guy was okay. The only thing that fell apart for Madoff was the fact that he had a lot of redemptions that couldn’t fund. He turned himself in.

The bottom line is, these agencies view themselves more as enforcement as a supposed to preventative. If you were the investor, your best prevention would be, don’t hire the bad guy in the first place.

If I had a way to avoid bad guys, it’s my responsibility to avoid the bad guy.

Now, if that bad guy rips me off, and I report it to FINRA the SEC, they come in as the enforcement agency, but you’ll notice in story after story, by the time they get involved, the money’s already gone.

The real way to protect the investor is to make good decisions upfront, select high quality advisors, and you don’t have the problem. If you hire a low quality advisor and there’s a rip off, you know, you got a regulatory agency, it will eventually get involved in it.

But at that point, the money may be gone, so no way to recover.

Finding a Financial Advisor

Charlie Hoehn: Can you walk us through sort of the high level of how we go about finding and researching and hiring these financial advisors you’re talking about?

Jack Waymire: Yeah, I think we covered a bit of it to the extent that I can go to Google and put in a few keywords, financial advisor, Chicago, Illinois, and I’m going to have 300 choices sitting on my computer. The problem I have is, I don’t know if they’re good choices or bad choices.

Once I identify an advisor or a firm, I might go to FINRA to see their compliance record, I’m going to visit their website, I’m going to Google search their name. I’m going to look at as much public data as I’m willing to commit time to in order to determine the quality advisor.

Then I kind of narrow it down to four or five advisors.

I then initiate contact with the advisor. I already found them. I found them by using Google, I researched them by visiting their website, Google searching their name, et cetera and now it’s time to initiate context, so I send them an email saying I’m interested in their services or I pick up the phone and I call them.

“In this environment, the investor initiates contact with the advisors that they’ve already researched.”

At that point, the investor knows more about the advisor than the advisor knows about the investor.

See, if you go back before the internet was as popular as it is, the only way the investor could learn more about the advisor was to contact the advisor and as soon as you contact the advisor, it becomes a sales process.

That advisor wants to convince you to buy whatever that advisor is selling. You don’t necessarily know if this is a good advisor a bad advisor or because you had no way to research the advisor. Now you do. It’s simple, it’s free and you can maintain your anonymity while you do it.

You only contact the advisors that you’re comfortable with. They’ve got the right credentials, they’ve got the right experience, they’ve got the right compliance record.

One really cool way to think about this is where years ago, Wall Street controlled the process, nowadays the investor can control the process because they can use the internet to access public data, it gives them a lot more control than they’ve ever had in the past.

In the past, they might have hired the best salesman, in the future, they hire the advisor with the best qualifications. That would be the impact of the internet.

A Shift in the Industry

Charlie Hoehn: So how long do you think it will be before we see the societal shift in the financial advisor realm?

Jonathan Dash: Sure, yeah. I think there is a shift already happening as we speak. It’s not as big as we would like it to be, but we see now that people are paying a little bit more attention to some of the things they may want to look for when trying to find a financial advisor.

So we are getting questions like, “Are you a fiduciary?” And we never got those questions before.

Fiduciary means that we’re under a standard, the advisor is under the standard to do what’s in the best interest of the client before our own best interest.

And there’s advisors who are fiduciaries and then there’s advisors who are not fiduciaries. And the ones who are not, they are under the suitability standard which means they could do what is in their own best interest before their client’s best interest.

If you could believe that there’s a standard out there like that, it’s pretty surprising.

Charlie Hoehn: It’s shocking, yeah. I remember the first time I spoke with you guys that was the number one thing that stuck with me.

Jonathan Dash: Yeah, so we are getting questions like that and I think that’s great. We started getting people asking that type of question, maybe starting 12 to 18 months ago and we are getting more and more people asked, “Are you fee only? Do you guys get paid commissions or are you just on the same side of the table as us?”

So it is great that we are seeing a lot of those types of questions, but there will always be salesman.

One thing that is starting to happen now is they say, “Oh we are speaking to this other advisor as well,” and we said, “Are they a fiduciary?” And he said, “Oh yeah, they told us they were fiduciary,” and we’ll look up the advisor ourselves on that SEC’s website, go through their ADV and we’ll find out that they are not a fiduciary. And they do sell commission based products.

So now people are asking the question, now those guys under the suitability standards are just saying, “Oh yeah, we’re a fiduciary,” because it’s verbal and verbal in this country doesn’t mean anything.

“You can’t sue anyone based on something that he said verbally.”

So that’s why in the book, we make a big point that don’t just listen to everything they tell you verbally, you want to get it on paper. So we tell a lot of people we speak to, we give them a website to go to.

We say, “The other two advisors that you might be meeting or to make your decision, go to this website, type in their firm name or the advisor’s name and you’ll get a document that that advisor needs to file with the SEC for their state and in that document, it will tell you what they really are. On that document they cannot fudge the truth in anyway.”

So we say always check their ADV document, go through it, it is not very long maybe seven to eight pages. It will tell you exactly what they charge whether they get commissions or not, whether they are a true fiduciary or not. I think that’s the best route to go.

And last week, we had someone say, “Oh I am meeting this other person,” and we typed in that person’s name in that same website and it also showed us that the guy had 28 law suits against him.

But, “Oh but he’s on the radio every day. He’s on the radio doing advertisements every day,” you know? It’s shocking to me that he’s doing advertisements on the radio, there’s 28 law suits that he’s had against him in the last six years. But people don’t know to go to that website and check a background, check whether there had been any complaints against them or not.

“Once we told her that and she saw it for herself, she closed the door on that very quickly.”

Now what this book is trying to do is saying, here’s some quick places for you to just do a quick check on someone to know whether you should even meet with them initially or not and not waste your time.

So we do think it is moving towards the right direction, and the internet is helping do that with all the transparency that you can get right now.

Jack Waymire: The one thing I would add to that is that at the end of the day, the investor has to accept more responsibility for their own decisions. There’s an old adage in the financial planning industry. The old adage is people spend more time planning their next vacation than they do planning their financial future.

There’s actually some logic to that. They like and enjoy vacations. They don’t really understand financial planning.

Consequently, what they do is, “I don’t need an expert to help me plan my next vacation but I do need an expert to help me plan and invest for my financial future,” and the bottom line there is that I’d better hire the right person.

Because if I am going to give that person the ability to influence or control my financial decisions, it is absolutely critical that I select the right person. So I’m going to have to maybe spend a little time on the internet researching that person before I turn my money over to that person.

“All of this information is readily available.”

The investor or consumer just has to spend a few minutes. What the book does is it just streamlines it. You know exactly where to go, you know exactly what you are looking for, you know exactly how it impacts you and now, you can make informed decisions.

If the advisor came in and said, “Sure I can average 25% a year on your money and sure, I am going to manage your risk and oh sure, we’re only going to put you into the best products.”

I mean, I create all these expectations in a sales pitch and it is a 100% verbal.

Watch what happens if there is a complaint and they end up in arbitration and they’re saying, “Yeah but the advisor said,” and the advisor is over on the other side of the table denying it, the investor will lose every time.

So documentation and doing your homework is really what we are talking about here.

Who Should Read 5 Steps for Selecting the Best Financial Advisor?

Charlie Hoehn: Are you catering to a certain caliber of investor with this book? Is it for everyone?

Jack Waymire: Anybody who is going to rely on a financial advisor for advice services, performance, risk management, etcetera, if you are going to rely on a financial advisor, this book is written for you.

If you are a millennial just getting starting out and you really can’t afford an advisor right now, and even then you might want to be educating yourself for when you do have enough money.

But I would say it’s for everybody, even if you are 75 years old. You still need to know do you have the right advisor. So my answer would be everybody.

Charlie Hoehn: And how much does it cost to work with one of the good guys?

Jonathan Dash: Yeah that’s a great question. So usually like you say, “One of the good guys,” are not any more expensive than the guys who are not giving the greatest advice, and it’s actually the opposite. Usually the good guys are charging a percentage of assets.

So you know roughly I would say around 1% of the size of your portfolio every year is around the average rate. There’s advisors out there that the ones that may not be giving the best advice and usually what we see because we see so many cases, hundreds of cases a year, usually those advisors are even charging more.

Because a lot of the times they are either getting commissions or they are getting a type of kickback from the mutual fund company.

And a lot of those charges though are not very transparent to the investor. So you could be with an advisor and the advisor is telling you he charges 1%, and he could be putting you in a portfolio or eight or 10 mutual funds.

Now what most people don’t know is that those mutual funds are also charging another layer of fees on your assets that you don’t see anywhere. You don’t see it in your monthly statements. I would say over 95% of them do not tell you that those funds are charging an extra layer of fees on your account and what the amount of those fees are.

If you add on that extra layer of fees, you have your advisor charging 1% and then the investment products he is putting you in could be charging another one to two percent on top of that. So you could be paying around two to three percent in that structure.

It’s not very transparent how you’re getting charged. I mean if you go to Walmart and you want to buy a box of Tide bleach, you see the price, it’s $3.49. If you go to another grocery store down the street, it might be $4.20, and it is very easy to compare.

Okay, it’s the same exact product. Walmart is cheaper than maybe the other retailer and you make a decision.

“But in this business, there’s not that much transparency.”

So you really got to look under the hood, read that advisor’s ADV report that I spoke about earlier because they have to disclose all the other types of charges that could be on your account when it is being managed by that firm.

The average price is around 1%, and it depends on the size of your assets. Sometimes when the size of your assets get larger over time or that is already larger, that charge could go down slightly based on the size of your assets.

Success from the Book

Charlie Hoehn: I want to start to wrap us up with your guys’ favorite success story of someone whom you’ve positively impacted with the lessons in your book.

Jack Waymire: Oh yeah, I’ve got one. This is actually a friend. This friend is fully retired and has approximately seven million dollars of assets invested with an advisor and this friend wanted the company that I work for, we do a lot of due diligence for advisors or for investors rather. They can basically come in and look at the databases that has already been vetted or they can have skits of that advisors for them, and in this case, this friend that asked us to review the advisor that he had.

And the only reason he did that was because the advisor was in the process of selling his practice to another firm.

So basically what the friend was really doing was saying, “I want you to go investigate the firm that my advisor is selling his practice to, to make sure that they’re good guys.”

Well as part of that research, we also researched his current advisor and this current advisor, he’d been using him for approximately 10 or 12 years.

“He had no clue.”

He thought he had a real advisor, he had a salesman that had basically loaded him into very expensive and mediocre mutual funds, the ones that paid the big commissions.

He owned a lot of annuity contracts that had paid really big commissions. He thought he had a real advisor and he wasn’t even really that aware of how that advisor was being compensated.

All he had to do is basically, I mean with this book, the front end of the book was all about advisors. Red flags, who to avoid, etcetera.

Then we take people through that five step process. If he read the book, he could have done his own due diligence. He would have found out that A, not only was his current advisor – how do I want to call it? I’d say I’d call it what it is: ripping him off. He was paying high commissions for very mediocre service and the new firm had lots of compliance issues. In fact, law suits and other things.

So he should have been uncomfortable with his current advisor. But if you ask him, “Well why would you keep this guy?”

The answer was, “Hey listen, he invited me to his birthday party. We go out to dinner. We go to some basketball games together.”

What that advisor had done was created a social situation because the advisor was generating somewhere between 50 and 75,000 a year off of this guy’s assets, and that’s before anything over on the insurance side.

“So he probably represented a 150,000 a year of income to this advisor.”

No wonder he took him to a free round of golf or a free basketball game. He had no clue that any of this was going on because he trusted the wrong person.

And even when he found out about it, he started making excuses for the advisor because advisors are very aware that if I can turn a business relationship into a personal relationship, the bottom line is people are a lot more reluctant to fire friends than they are people that they don’t consider to be friends.

So if I am an advisor and I am generating a lot of income off of your assets, I absolutely want to be your friend.

So one of the things we write about in the book is watch out for the advisor that’s a little too friendly, too many free lunches because that advisor you don’t ignore what he does with your money.

In fact it might even be a red flag that I want to dig into a little bit deeper. So that’s what really resonates with me.

Working with this Process

Jonathan Dash: You know we have a number of families who this process of choosing an advisor and managing their nest egg and all the money that they saved up was just such a difficult process for them, a process where it is the last thing on their mind.

They kept wanting to put it off all the time because it was such a hard decision and of course it’s a hard decision because you don’t know what to look for. You don’t know what to ask.

You don’t know much about how your assets should be invested and whether that’s a good strategy or way for your situation.

You know, all you do is listen and you hear people giving you all these ideas and you don’t know which one’s right or wrong, and you read things on the internet and you watch things on the news, and people are always trying to sway your mind here or there. The market is going to go up, the market is going to go down.

“It’s like an emotional rollercoaster for a lot of people.”

So one thing that I’ve enjoyed, a lot and a lot of the people at the firm have enjoyed, are watching a lot of our clients feel like hundreds of pounds of weight have come off their shoulders. That they could lean on us and say when they read something on the internet or they read an article or they hear something or some guy on the radio, they send it to us and they say, “Hey can you tell me what does this actually mean and what are they doing and whether this could be good for me?”

And they have someone who could vet things out for them that they could trust, you know? Our clients know that the investments that their money is invested in are the same investments that the principles of our firm have.

All of my money is in the same investments that our clients have. So are the people that work with the firm, we eat our own cooking right? And we are very transparent about the way we charge fees.

“We are very transparent about why we’re investing the way we are.”

So they truly understand where their money is, why it’s there, we give them a good vertical look into everything that has to do with their finances and that helps them sleep well at night. So they don’t have so much to question and all of that.

So I think that is a big thing that we’ve seen that has made us very happy and one other small thing to that is when we speak to people, people ask us, “Well what questions should we be asking advisors?”

And we’ve given them a few. We say, “Hey why don’t you ask an advisor what his track record is, what has he done for his clients over the last 15 years? What type of returns has he gotten?”

Charlie Hoehn: Well what’s the point in asking if he can just tell you whatever he wants?

Jonathan Dash: Yeah, he could tell you whatever he wants, but you could get it on paper.

There’s two performance auditing firms out there who do all the performance audits for big money managers that the big institutions use, the big university, the Yale, the Harvard endowments, you know when they meet with someone to say, “Should we give some of our endowment money or our foundations assets to you?” The first thing they say is,

“Send us your audited track record. It better be 15 years or longer and then we’ll look at the numbers and we’ll know whether it is even worth speaking on the phone with you or not.”

And when we meet with prospects we never get that question and the advisor, obviously most of them are never going to bring up the topic because they don’t have records that are tracked and audited. Because their records are probably not very good.

So like that, we are spreading that word out there and holding people’s feet to the fire.

A Challenge for Readers

Charlie Hoehn: So let’s wrap up with a challenge for the listener. What is one thing they can do this week from your book that can make a positive impact on their life?

Jack Waymire: If they already have a financial advisor, the one thing that they should do is go to FINRA Broker Check and enter the advisor’s name and learn more about the advisor and to see whether or not that advisor has any form, any history of complaints or regulatory actions, etcetera. I want to make sure I have an ethical advisor.

And then if I want to find out later if I’ve got a competent advisor, then it gets more into some of the issues that Jonathan brought up.

Because the definition of a competent advisor could be an advisor who delivers competitive performance for reasonable rates of risk and expense. And if that’s my definition of competence, they are delivering competitive results, then I need an easy way to go out and determine if I am getting competitive results.

But I would start with the ethics because, like Jonathan said, a lot of advisors do not necessarily have published track records, but they do provide performance reports to their clients. It creates a little bit of an anomaly because they deliver performance reports to their clients but they don’t have track records that they can provide to perspective clients.

It takes a fair amount of work to consolidate the records of a lot of clients into an overall track record.

So the bottom line is they can’t really prove what they’ve done in the past, and that is basically Wall Street. Wall Street really wants this whole decision process by the investor to turn into a sales process and then they basically hire advisors with good personalities, good selling skills and so what the investors are up against is they are trying to learn more from a very skilled sales person, and it’s worked for Wall Street for years.

What we are hoping for with the book is that the internet will be enough of a game changer that enough investors will realize, “Hey, I’ve got access to all these data now. I am not limited by what the advisor tells me and I could go out there and review this information and I could be anonymous while I do it. It’s free. It doesn’t cost me any money and I could do the whole thing in 15 or 20 minutes.”

That ought to appeal to a lot of people, we are hoping.

Connect with Jonathan Dash and Jack Waymire

Charlie Hoehn: So what is the best way for listeners to follow you guys and potentially get in touch with you?

Jack Waymire: Well for me, it’s It’s about a 15 year old website. It is loaded with investor education content of only about advisors. We don’t get into any financial topics.

So it is a very specialized website that deals with advisor related issues. It also has a registry where if you are looking for a financial advisor, it’s a free service to investors but we’ll match them to the right advisors in their community or you see is a lot of virtual advisors too.

Where it’s not a matter of the advisor who jumps in the car and drives to the investor or the investor jumps to the car to drive to the advisor. Now it’s a lot more using technology to communicate with each other. So Paladin Registry can match them to high quality advisors in their community. It’s a free service and it’s just

Jonathan Dash: Yeah and they could reach us at There’s a lot of educational information on how to choose an advisor, what information is important, what’s not, as well as what’s in the book.