About Getting Financial Planning Software Approved for Use |
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financial planning software you can use will make or break you in this business!
First, here's a generic 2005 Finra response to the question of their roles in approving financial planning software: As you know, Reps may use only sales material that their firms (through internal compliance departments) allow them to use. We are all aware that there can be internal struggles between marketing and compliance over what is acceptable and what isn't. If there are products or services you want to provide, but feel like you're not allowed, you will need to handle it internally. I would think raising it with your Branch Manager would be the first step. Finra staff does not force a firm to begin using a certain product or to allow the use of a product that it has chosen Not to Allow - those are firm based decisions. I understand the issue you've described, but I generally do not intervene regarding these types of business decisions. Our staff works with compliance officers on a daily basis to review sales material. We receive financial planning software through the filing process and review it accordingly. Some of the programs are required to be filed, others are filed on a voluntary basis. Some firms submit compliant programs, others do not. Compliance officers may have several reasons why they do not approve certain software programs. If a software program is prepared by a third party, the Broker Dealer firm has little control over the content, ability to revise the existing version, or on-going revisions to the program. If a compliance officer determines that his or her firm should not use a particular program, that's their decision. If the compliance officer approves a problematic piece of sales material then they take a huge risk for themselves and the firm. Financial planning software, when used with the public, is generally defined as a communication with the public. The rules regarding Finra members' communications with the public can be found in Finra Conduct Rule 2210. All communications with the public require approval by a Finra member firm's compliance department prior to use, but not all communications require filing with Finra Advertising Regulation Department ("the Department"). Depending on the communication's content, some financial planning software is required to be filed with the Department. We direct your attention to Finra Conduct Rule 2210(c)(2) and IM-2210-6 for some of the Rule's filing requirements. Financial planning software must be looked at on a case-by-case basis to determine whether or not it must be filed with the Department. If you need assistance, you should talk to the compliance department of a Finra member firm, and if the compliance personnel have questions, they are welcome to contact us. Finra Conduct Rule 2210 and IM-2210-6 may be found online in the Finra Manual. All communications with the public used by registered Representatives are subject to Finra Conduct Rule 2210. They may be subject to the rules of the other regulators also, depending on the subject matter of the communication. This rule applies to communications about all products and services including financial planning software regardless of whether specific securities are identified. Under the rule, financial planning software is considered within the definition of Sales Literature. There is no separate sub-category for financial planning software. Finra requires that a registered principal at the Rep's firm approve internally all sales literature prior to use. It is the principal's responsibility to make sure the material is in compliance with the rule and to determine if the material must be filed with Finra. The rule requires, among other things, that sales literature is fair, contains risk disclosure, does not contain misleading information and does not omit material information. The rule generally prohibits the use of predictions or projections of performance.
Download their "new" piece: Rule 2214 on page 128 clearly states: "No member may imply that Finra endorses or approves of the usage of any investment analysis tool or any recommendation based on such a tool." Here's their old piece that states: "The filing requirement does not apply to hypothetical illustrations of mathematical principles that do not predict or project the performance of an investment or investment strategy, such as Web site calculators that compute future returns based upon assumed variables, since Rule 2210(d)(1)(D) does not prohibit (and IM-2210-6 thus does not cover) such illustrations." The bottom line is that our financial planning software falls under the Hypothetical Illustration Exception to Rule 2210, and thus does not need to be filed with Finra. What Does All that Mean? Before explaining all of that, here's some newer facts after talking with Finra in April '13: • It's "illegal" to say the words, "Finra approved." A Finra Supervisor said that enforcing this rule is like cops giving out speeding tickets - everyone speeds, and only a tiny fraction of people are actually caught doing it. But over time, those that are caught and "punished" will tell others, so over time, people will use these banned words less. • Finra does not "approve" or "disapprove" of anything. • There's no such thing as a "Finra approved list," but there is a list of investment software that didn't pass their review process. Finra calls this the, "Do Not Use" list. None of our money software is on this list. If a member firm (BD) asks them to review "material" (e.g., software), then they will. So if a financial planning software vendor like us has had a BD submit it to them for review (which many have over many years), and they did not come back with a list of things that needed to be "fixed," then it passed their review. They didn't say what words they actually use, so "pass" is incorrect too. They said, "We'd sent it back without a list of concerns that need to be addressed." What is not correct, is the word "approved," because Finra does not approve or disapprove of anything. If something does not pass review, then there's no word for that either, so they'll say things like, "Here's the list of concerns that need to be addressed. We'll review it again after they've been resolved and you resubmit it." It's only when material has so many problems that they think it's beyond hope, that the result of their review would be, "Do Not Use." Then there is no "list" of vendors for the two categories of "okay" and "fix and try again." There is a list of "Do Not Use," but they don't publish it or give it out. But if a member firm asks them to review something and it's on the "Do Not Use" list, and it's the same version, then they'll tell them it's on the bad list. So when a member firm requests a review of a software program, it's only going to fall into one of three categories. The first is, it's "okay" and then the buck is passed onto the member firm (BD) to "approve" of it or not. Then the second category is, "This is the same version as the one we labeled "Do Not Use," so until we get a new version that's different, then it stays in this category." The middle category is just one of being in "limbo." Which probably means they haven't got arountuit yet. Or they'll send it back with a list of things that need to be fixed. • When BD's say, "MoneyWhatever is Finra approved," this is not only technically incorrect, but is "illegal." All Finra has to say about that is that someone at Finra reviewed MoneyWhatever, and didn't find any egregious errors that could bring harm to the investing public. Then they'll tell the BD that they don't have a problem with MoneyWhatever, so the ball is back in their court. Then the BD "approves" of it, and then Reps can use it for their client financial plans. This complex, evolving, hit-and-miss, and confusing process is the source of what Finra calls, "The Great Misunderstanding." BDs have been saying to their Reps, "You can only use the financial software on our list, because that's the only program that's been Finra approved." This would read like this after passing through a "truth translator:" "We have a list of financial software that we like, for no better reason than the personal preference of a few people in BD management (that may have never even been a Rep in the Real World nor ever met with an actual client in person), and maybe some hidden kickback money to us from the software vendor. So it's all that we approve of you using for your clients. We're just lying and using illegal wording when we say Finra only approves of this list. This passes the buck of responsibility off of us and onto Finra, which we know you're too lame to investigate to determine what's really going on. So don't hate us, hate Finra for this! They're the ones that approve or disapprove of everything you can use or not. Then we just don't care because we make the most money, and do the least amount of work like this, and so far nobody has forced us to change our ways yet, so we're just going to do this forever because it works best for us. If you don't like it, and want to make a fuss, then you're terminated for not being a team player." • So a bottom line is that if anyone says any of the following things, then they should be "corrected" (and if they refuse to stand corrected, then they should be reported to Finra, so they can "straighten them out"). Examples of illegal words are: - ...is Finra approved. - ...is not Finra approved. - Finra has approved of... (this software). - Finra has not approved of... (this software). - My BD won't let me use this software because they say it's not Finra approved. - My BD says I can use this software because it's Finra approved. - This vendor says I can use their software because it's Finra approved. - This vendor says I can't use this other vendor's software because it's not Finra approved. - The word "blanket" in the same sentence as Finra is also frowned upon. Etc. and so forth, you probably get it by now. Back to trying to condense all of these generic concepts into plain English: The short version is that everything a Finra Registered Representative shows or gives to the public must first be approved by the Reps' Series 24 Principal in their Branch Office, and/or their Broker Dealer's Compliance Department. This includes even generic financial planning software that doesn't have anything to do with investments. So even running a simple college funding report is considered to be "advertising and/or sales literature." All types of this literature / material need to be "approved" by the BD prior to communicating it to the public in any way (verbal, written, seminar, slideshow, website, etc.). "The public" refers to anyone that is not a Registered Representative with Finra, nor a Member Firm (BD). These rules do not apply if you are an RIA (Registered Investment Advisor) and are not also a Finra Registered Representative. Although you're still under the jurisdiction of your state until you manage $100M in assets, then you're under the SEC's jurisdiction. Either way, RIAs don't have any of these rules regarding what you can or cannot use in the way of generic communications, or financial planning software. So as long as you're wearing a "White Hat" you can say, write, present, and use just about anything you want to (including on your website). The BD / Finra and RIA / SEC worlds are totally different when it comes to all of this. So if you are a Registered Representative with Finra, then this presents many serious Real World problems, if you want to make a living using great financial Tools For Money to advise clients about financial planning, forecasting their financial futures, and/or investing money. Now to confuse you: If a BD asks Finra to evaluate a software program, then Finra may issue a "review letter" to BDs if it passes, so BDs can put the software on their "approved list." As long as Finra doesn't find anything wrong with it, then they'll let BDs approve it. So this is a gray area that changes depending on whom you talk with at Finra. The thing to note is that the BD is allowed to have "approved" and "disapproved" lists. But Finra does not. Then nobody is allowed to say that Finra has anything to do with, nor has any opinion on, these BD generated lists. Then guess which feature makes it so Finra will not let financial planning software pass? The Monte Carlo function! That's right, according to Finra in 2014, if financial plan software has a Monte Carlo simulator built into it, then Finra will put it onto their "Do Not Use" list. Now the confusing part: MoneyGuidePro is not on their "Do Not Use" list! If you want to experience the ultimate in "government officials" waffling in hyperbole, then call Finra and try to get to the bottom of that mystery. They'll pass the buck, put you on hold, your call will be dropped, and everyone will act like they have no idea what you're talking about, and they will get rid of you like a hot potato! So if you run into a situation where our money software is not approved by anyone (because of the Monte Carlo function), but MoneyGuidePro / MoneyTree / NaviPlan is approved, then here's a deal for you: Contact the site, and tell your story. We need the names and contact information of everyone involved (especially Finra employees, BD management and compliance people), dates, and copies of all relevant communications. Then to thank you, you can have most any financial plan software on the site for free. The next time this happens, it will be escalated up the government food chain until this buck stops with someone at Finra, that someone high up in the government can pin down and call onto their carpet. Then there will be an investigation, the mechanics of how and why this happened will be tracked down all the way down to back-door kickback deals, and then this problem will be rectified via appropriate punishments that will make the news to the point where it will stop once and for all. Finra is an SRO (a Self Regulatory Organization). In other words, the government lets the commission-based securities industry regulate itself! Whowuddathunk! This results in many things like this being overlooked, because the people working there know better than to bite the hands that feed them. This is why fake financial software like MoneyGuidePro is allowed to run amok. If someone at Finra tried to ban BDs from using MoneyGuidePro, then the outcry from its members would result in their immediate termination, and then permanent unemployment, just for not being a "team player." BDs would wine to Finra, because Reps would whine to them, about having to do actual work for a change, instead of presenting quick and easy falsehoods to their clients, just to close their deals with minimal effort. I know because I worked with a high-level Finra Supervisor about banning it in 2013. After reading my arguments, he agreed it should be banned. But the fear in his voice, and then him never getting back to me, after he promised he would, was obvious. It wouldn't surprise me if the reason for his "negligence," is that he was terminated for even considering it. Critical Little-known Facts about Software Approvals It's not the money software that needs to be approved to use it, but the actual reports you make from it (AKA "material"). So after you buy, learn, and then make a report for a client or prospect, then you'd submit the paper reports you want to give or present, to a 24 and/or BD compliance. Then that's what they'll approve or not. So even if your BD "blanket approves" of a software vendor, that still may not mean you can bypass this process of getting an actual report approved. Even though software may be "blanket approved" does not mean that you won't still have to submit reports made from it. Sometimes you'll still have to submit them. The point is if you still have to submit printed reports you plan to show or give to clients, then our investing software is just as approved as any other. So what you'd do is submit a demo (or use a trial version and Make an actual report) for approval. Then more than likely, it will be approved just like anything else you want to show, give, or use. Next, realize there are four players in the process, that serve as the "Chain of Command," that you're best not to even think about circumventing in any way. It starts out with your Branch Office's Series 24 "Principal." This person may also be the Alpha Doggy of your office, which is your Branch Manager. Your Branch Manager is also "a 24," but may have delegated these duties to a lower-ranking 24. So getting things approved may not have to reach the Branch Manager, if there's a 24 below them doing this. If your request doesn't make it past them (they just passed the buck), then they will submit it to the BD's compliance department. These Principal 24's outrank even your Branch Manager in such matters. If your request doesn't make it past them, then they will submit it to Finra, which are the ultimate authorities. All bucks stop at Finra. You don't want your request to have to go to Finra, as it may cost money and take a long time. Note that even if Finra says it's fine, any of the three other players can refuse to approve it, just out of "personal preference," they just don't like it, they don't like you, they don't trust you, you may "know just enough to be dangerous," you're not a "team player," or whatever - it doesn't matter. It's their way or the highway. So even if the Finra alpha dog says it's fine, you'll still have to abide by the decisions of all of the lower-ranking dogs. Basically all four players have to approve it, or you can be "terminated" just for that (with a bad mark on your U-5, which will make it very hard to join another BD). This is why this page is here, so you can better understand all of this, so you can stay out of trouble, and maybe even avoid it all in the first place, which is definitely what I recommend doing after being around all of these blocks several times, in several different modes - even being employed as a low-ranking W-2 24 for years. So what do you need to do to use this financial plan software, or any other? Just ask them. Start with your Principal / Branch Manager that holds a Finra Series 24 license. They know all about it, as this is one of their primary functions. Print either a live report made from the actual financial software, use reports in the free sample financial plans, or demo's presentation pages, then associated downloads, text that explains the reports to clients, and even maybe the directions and user manuals. Then BDs all have standard legal request forms / cover letters ready to go just for this purpose (usually called the Advertising / Sales Literature Approval Request Form). Fill out the form and attach it to front of the report batch (so when someone gets it, they'll know exactly what it's about). This usually does not cost the Rep money. Write the date you submitted it on the front page of the reports too in case it gets "lost." Then make copies of everything, including the compliance submission form. Keep a copy and give a copy to your firm's Principal. Your Principal may want you to give two copies to them, and once they say it's okay to send to compliance, they'll send one of the copies off to them. Compliance likes it better when it comes from a 24, and not Reps. Then they will do their things and will respond. This takes about a week, unless your Principal / Branch Manager can approve it themselves, in which case it could take just a few minutes. All of the generic financial planner software on this site should make it through this process, even if it has to both go through BD compliance department and Finra. So if you just follow your BD's submission process, and the chain of command, then most will approve most anything that looks reasonable (because most all financial plan software is basically the same thing just wrapped up in a different wrapper and then presented a little differently). When things are approved, you'd then edit the footer (Page Layout, click the tiny arrow box at the bottom right, then Header and Footer) in both Word documents and Excel spreadsheets (you can do this even if they're protected with a password). Then paste the compliance approval number there (after deleting the copyright text). It's the compliance officer's job to use this procedure to get software approved for use by Reps. If they don't do it like this, then you could just have a bad compliance person. Good BDs will either do the due diligence themselves and say yes, the mediocre ones will say they need to send it to Finra for review, and the bad ones will just say no. Now we're getting into the red meat. Why You're Being Told: NO! Why do Broker Dealer compliance officers say no when asked about the usage of generic financial planning software? Most Broker Dealers will approve financial planning software, but only if the Rep formally submits it to them using their submission forms. But if you just ask them if "they approve of XYZ software," they'll usually say no. This is because very few financial plan software packages are "blanket approved" for use by all Reps, no questions asked. This is because once a BD goes through the arduous, time consuming, and expensive process of getting a particular financial plan software platform installed, approved, integrated into their other systems, then send Reps to expensive formal training classes; they're stuck with everything for decades. This is because they don't have the resources to go through that process again. Then, to protect this investment, they won't let their Reps use anything else. So you sometimes can't do what's best for your clients, mostly because your Broker Deal is "broke and broken." It's just as simple as that. There's sometimes nobody even there to do this work, because they were all terminated due to having no money to pay them. If you're thinking this is a broken system, then you are correct. We're just pointing out the mechanics of why. I call Broker Dealers, �Broken Dealers� because of all of this! Although most BDs will approve our financial plan software when properly submitted, we specialize in the no-conflict of interest, non-BD world of RIAs, where there's nobody "in power" over you saying, "No, you can't do that." So you're not paying "monopolistic prices" here for financial planning software. A quasi-monopoly is formed when a large BD only approves of a particular software vendor. When this happens, the vendor jacks up their prices simply because they can, because of this "captive market." Then they'll give that BD's Reps a fake "discount," to mask the shenanigans. All of the financial plan modules on this site have been approved by several BDs when submitted correctly. Sometimes, they say it has to be sent to Finra. What a good Principal and/or compliance person should do when they get the submission, is evaluate it themselves. Then if they think there is something investment-related that might need to be clarified before approval, they'll fax it to Finra. Compliance officers have an open line to Finra, so they can usually get the information to someone the same day, and get an answer back in a day or two. This is one of their primary functions that you are paying them for. Then Finra is going to say it's okay to use all of the generic financial planning software on this site as is. We know because we've been there and done that with many good BDs in the past (plus constant feedback from hundreds of customers). These days, many BDs are in survival mode, so they may just pooh-pooh everything just to get you out of their hair, and to avoid every little thing that has any remote chance of causing trouble, wasting time, or costing money. If so, then it's just a matter of time before their troubles get passed onto you. You're in trouble if your compliance person just says no, or doesn't want to submit it to Finra. Then compliance is not doing their jobs, and you'll need to work with BD management, to get to the bottom of the issue. So if compliance is not giving you answers to your satisfaction, then you should escalate the issue up the BD food chain to get to the bottom of it. This is a place you planned to "work at" for decades. So you want to know if your compliance person just needs to be replaced (top management also needs to know this, and may thank you for pointing it out), or if top BD management is the one behind your compliance department not performing their functions correctly. If it turns out that compliance wants to do their jobs right to help you succeed, but they're under orders by management to not approve this or that software, then that should be the last straw (because this is just the tip of the iceberg that will sooner or later sink your whole ship). So compliance will put their self-interests ahead of the Reps, the clients, the investing public, and play along in a New York minute (out of fear of termination for not being a team player). So if your BD says they only approve the big code-driven financial plan software platforms, then this is probably why. These vendors are also probably kicking back money (to BD management) in return for not approving any other financial plan software. This may work for them in the short run, but over time, they're going to lose the best Reps, because they'll leave and go to a good BD where they can run their practice the way they want to, and that puts the Reps' and investing public's interests first. That's how you make real money long-term. Or real talent will just bag this whole obsolete BD business model, and become their own RIA. Compliance officers also live in a world of fear. If they're negligent, they could be held personally responsible (which means they could end up paying money from their own personal bank account). So to protect themselves, some just "say no" to everything they can't get a black and white answer to, or things they are afraid of, or things they don't have time to research, just don't like, or don't understand. All of these things may pass Finra's review process, but may be banned just because of the narrow vision of a compliance person's, or BD management's personal opinion. So you really need to get to the bottom of this ASAP if you plan to stay in this business. The longer you stay with a bad BD, the more these types of problems compound, the more your efforts to succeed in this business will be thwarted, and the higher the odds are that you'll be back at your old day job next year. It's usually only the "good" big BDs, that will let Reps use what they want if it's properly submitted. In general, the smaller the BD, the more likely it is that they'll approve anything you want to use. The more "White Hat" the BD is, the more they'll approve ours, and similar financial software too. But the flip side is the more the BD is controlled by a life insurance company, and thus the more "Black Hat" they are, the less likely this will be. This is sometimes because of things like this (that our financial tools excel in): • Our financial plan software is geared toward showing clients the truth about what they need in the life insurance area. For example, we have an accurate life insurance needs calculator, which makes it unlikely to over-inflate actual capital needs. If you could wave a magic wand make it so all life insurance sales only covered actual needs, and no more, then life insurance companies would go under. They basically live or die by agents' abilities to oversell what's really needed. • Our life insurance calculator also accurately projects capital needs far into the future. This shows how and why needs dramatically decrease over time. Whereas life insurance companies need insureds to keep buying more regardless if they need it or not. This is not in their best interests. • We point out how most all life insurance company products are just "not good" in general. For example, we're the only ones that bunk myths that whole life insurance is good, with this buy term and invest the difference calculator. • Then there's the fixed annuity problem and the variable annuity problem. So the more life insurance oriented your BD is, the more you will hear NO when trying to get our financial plan software approved (and also similar vendors). Just about the only thing generic financial plan software has in it that can raise a compliance eyebrow are the assumed rates of returns. These are the same returns Reps input into code-driven financial software, so this is not a valid argument. So we specialize in the RIA market, where advisors can freely buy and use what will work best for their clients - not what makes the BDs (and/or their parent life insurance company) the most money short-term. If you don't think the financial world works like this, then just try to get to the bottom of why some BDs "blanket approve" of only a few financial planning software vendors. No matter whom you talk with, no matter how high up on the BD food chain you go, you will not get any actual answers. It's all a huge mysterious top-secret. So it's all about who gets invited to parties and to go golfing with whom and whom is scratching who's back and expecting to have the favor kicked back. This is how most everything on "Wall Street" works. There's no logic or wanting to do the best things for investors going on, it's just people abusing the power they have, to do the best they can for themselves and the good 'ol boys on their teams. You are the One that Has to Determine the Reality of the Situation at Your BD, if You Want to Succeed in this Business! Nobody else is going to tell you if something really can be used or not, unless you figure it out yourself. If you leave it to your Principal or compliance officers, then you may be stuck being told, "It's either our way or the highway." You may make a little more short-term money like that, but you won't make the big long-term money. Your long-term success in the business depends on consistently giving clients what they want and need - in White Hat mode. Compliance officers also want to say everything you ask them to approve has to be sent to Finra. This is just passing the buck, and/or they're hoping they will annoy you to point of just going away and forgetting about it. As you know, this costs you time and money. Never forget you are paying them to perform these functions. I worked as an employee, a 24, and Finra Rep, at three BDs that approved the Model Portfolios without submitting them to Finra by the competent compliance person just reading the rules and coming up with a list of things that needed to happen to get them approved. But when I did the exact same thing with Royal Alliance / AIG, compliance immediately said everything needed to be sent to Finra. They wouldn't even approve the Financial Plan Fact Finders, which contain nothing that can be out of compliance. They didn't even take one minute to think about it, nor look up any rules. After more research, they finally admitted to just being a "NaviPlan-only BD." So in my opinion, Royal Alliance / AIG is an example of a "very bad BD" that should be avoided. This was 2004, and my predictions of what happens in big bad BD world was proven right - they went under, and the taxpayers had to bail them out with $182 billion (or 92% ownership), just because they were "too big to fail." Also, there's only been one time where a customer went through the BD IPS approval process, and didn't get it approved. The BD said he couldn't use it because they were afraid the Rep wouldn't follow it! That's right, "We don't want you to do anything good for your clients, like use an IPS, because we think you're too stupid to actually manage their money according to its guidelines, then that's just going to get us into trouble!" Then this BD is also a MoneyGuidePro only shop - so they won't let their Reps use anything but that for their financial planning software. This BD is Morgan Stanley! You'd think they'd just do a search for "training programs for salespeople" and conduct basic financial planner Rep training. But no, it's easier and more profitable short-term to keep the Black Hat on and continue to conduct business as if was still the 20th century. I'll have the last laugh at this, because I'll still be here whining when they eventually go under for good, it's just a matter of time - just like the leader in the full-service stock brokerage space did - Merrill Lynch (they went under during the Great Meltdown, and were bought out at distressed prices by BofA, which now realizes the acquisition was a colossal blunder). All of this is the way of the past, so their days are numbered. It's only a matter of time before this old stalwart 20th century leader of Wall Street just gives it up and goes under for good. When this happens, expect the Morgan Stanley's of the world to shortly follow suit. Then the smaller stock brokers, then the bigger BDs, then most all of them. 100 years from now, there probably won't even be any Broker Dealers. None of this happens once you migrate up the financial planner food chain pyramid and graduate to the RIA world. Read more about the obsolete Broker Dealer business model - and how people keep trying to squeeze the last dollar out of something hopelessly broken and eventually going the way of the dinosaurs. The first clue that the whole commission-based biz model is slowly being replaced, was AIG (and its dozens of life insurance BDs), Merrill Lynch, et. al just completely going under and having to be bought or bailed out with your taxpayer funds just to survive the financial meltdown (which they helped cause). About the obsolete Broker Dealer business model - and how people keep trying to squeeze the last buck out of something hopelessly broken and eventually going the way of the dinosaurs. I have yet to run into even one RIA fee-only advisor (without a BD / Finra attachment), that uses MoneyGuidePro or Profiles. Maybe 5% use NaviPlan. Some RIA's with BD's use them, but once the BD is out of the picture, then so are these fake MoneyWhatever vendors. When you're free from BD tyranny to use the money tools that will do the best jobs for your clients, then "nobody buys BD software." The next question you need to ask yourself is, how would your life be affected if your BD went under? Here's a Word docx with articles showing just how often they go under. We can't think of anything good that would result from that. The chances of a BD, and/or its parent company, going under is directly proportional to how "good" or "bad" they are (have been, or are going to be). Spotting the bad ones before you join up is hard, so the best way of determining if a BD is bad, is just by going through the financial planning software investigation and approval process BEFORE you sign anything. The best way to find the spiders lurking in the shadows waiting to suck your blood while you sleep, is to shine the light of day squarely onto them. If they try to run and hide with, "We can't give you any opinions, nor approve any financial plan software until you become a Rep, even though I as the Branch Manager and Principal am a Rep and have the power to submit anything to compliance and get an opinion back in a day or so, free of charge." Keep in mind that the Branch Manager is / was usually the top "salesperson" in the office, and is a Rep. So if anyone can sell ice to Eskimos, it's them. So they'll always be selling you on all of the good things about "working" there, and omitting all of the bad things as much as possible. Not being able to use the basic financial tools needed to do your job, is a very bad thing that they're great at neglecting to tell you in advance. Then they will deny everything they've said in this regard, after you sign up. The Critical Bottom Lines So the lesson here is that you, the financial adviser and Finra Registered Representative, need to do this kind of research BEFORE you sign up with a Broker Dealer. Doing it any other way would be like being a carpenter, hired by a firm (that doesn't pay anything) to pound nails, and then when everything is all set up and you start to work, they'll say you can't use your normal claw hammer. You'll have to use their ball peen hammer; which they'll be happy to sell you of course, even at a discount! Then you'll say, "I can't pound nails with a ball peen hammer, what's up with that?" Then they'll say, "We know, we're sorry and feel your pain, but that's just how we do things here, and it's our way or the highway. You should have asked what kinds of tools you can use to do your job before you signed our contracts, huh?" To bad BDs, it's around a 90% chance that you're just going to be a less than one-year flash in the pan anyway, because that's their average. So all they care about is how much money they can suck out of you during this period. So take their sales pitch with a grain of salt and stay focused on what your life is going to be like living under their regime day in and day out. The best way to do this is to grill any long-term Reps about how they feel about the financial planning tools they're allowed to use. Interview at least the top Rep in the office and a barely surviving rookie. You want to find out what's making the top Rep successful, and why the rookie Rep is not surviving. If the Branch Manager won't let you interview them (usually because they're "too busy"), then do not join that BD, it's as simple as that. What they're doing is keeping all the bad parts of your daily life hidden from you, until you sign all of their contracts, and it's too late to back out. If there are no Reps that have been there more than five years, then that's red flag #1. See if you can talk with Reps that have recently left - then ask them for their gripe list. One way to do that is when shown your new office, ask who was the last occupant. All you need is a name and you can probably find them via Internet search engines. You can usually find them using Finra's website. If not, then look at the sales commission payout logs. Then track them down and take them out for dinner and drinks (and pay), and then you'll hear a never-ending rant about how and why you should not join that BD and/or that particular Branch Office ruled by that particular fearless leader (which may be the only problem - in which case, you may be able to find a better local Branch Office). If you don't do this, then not only will this be you soon, but you're not going to be told about any of these problems until AFTER you're on board - "Oh by the way, we're a NaviPlan only shop. You can't use anything else, so don't even bother submitting other financial tools to compliance for approval." We were actually told this after the Branch Manager bamboozled us into joining Royal Alliance / AIG in 2004 by saying, "Sure you can use your own financial tools, they look great!" Then he "didn't remember" that bold-faced lie when the disapprovals came back. So I bailed the next day, and haven't had anything to do with any BD or Finra since (and life has been much better). The best way to test your prospective Broker Dealer, to make sure you're not going to be caught in their trap once you've signed up, is to get a Principal or Branch Manager to submit financial plan software you want to use to compliance for approval BEFORE you sign up. In other words, while you're negotiating / interviewing, give hard copy print outs of all of the financial plan modules you want to use to the Principal or Branch Manager that's trying to get you to join. An even better way is to just have the BD submit the actual software program to Finra for review. We'll be happy to send actual working financial plan software to Finra or a BD compliance person for this purpose. Tell them in writing that being able to use the financial software you like, is a requirement of hooking up to their BD as a Rep. If there's no problem, then the Branch Manager will submit everything to compliance, they'll give an opinion, then you'll hear back. If the Branch Manager doesn't want to do this (regardless of any lame excuse they give), or if compliance says no, then just don't join them. This is a BD that's just going to do everything they can to ruin your life. If they say it has to be submitted by an actual Rep with the BD to Finra for approval, then tell the Principal or Branch Manager to do that (because they are a Rep). If it costs money, then tell the Branch Manager you'll split this cost with them. If they don't want to spend small amounts of money on recruiting you (~$100), then this is not a good BD to join. If you join without performing this CYA 101, then you'll probably spend the rest of your life paying for that one mistake. Everything may seem fine today, but just wait. There's hundreds of BDs out there that desperately need your fresh meat for their grinder, and you're hiring them more than they're hiring you; so shop around until you find the one that works for you. The bottom-line is that you should never join a BD until they first approve all of the financial planning software that you want to use. If they don't, then you'll be stuck using something what's not going to work for you. This is because clients won't like it, so you won't make any money like that, won't meet their minimum sales quotas, and then you'll get fired or will quit in less than a year. Then you'll be stuck in the time consuming and expensive trap of having to switch BDs and transfer your business to the new one. Then the wars start because the old BD will punish you as much as possible by keeping all of the money, clients, and work you put into building your practice. First it will take months to find a new BD that's right for you. Then it will take hundreds of dollars to join them. Then it will take hundreds of hours and dollars to fight the old BD to do the paperwork to block transfer your existing clients to the new BD. Then when these wars start, lawsuits will be filed, and this will suck thousands of hours and dollars out of you again. Then you are not legally allowed to make one dime, even from your old clients, until all of this is resolved! So you could easily be "out of work" and starving for over a year (until they feel they've punished you enough, then get around to doing your paperwork like they should have on day one). This is what's meant by being "stuck helplessly bleeding on their meat hook." They have all of the power, and you have none. Everything may seem great today, but just wait until one stupid little thing happens. Then the tables will turn on you, and then you'll experience this cold harsh reality for yourself via a life-ruining debacle of unimaginable proportion. Then you'll be in complete shock when you realize the true nature of the people that made such a nice friendly fuss to bring you onboard. I've seen this happen hundreds of times, it's happened to me several times, and it happens every day thousands of times. Please remember that you were warned well in advance via these types of pages on this site. Every month we're contacted by a terminated BD Rep saying how right all this is, and how they should have heeded this life-saving advice back when they had the chance. So one of the most critical decisions of your career is to find a good Broker Dealer the first time around. How to do that is to make them approve ALL of the financial tools you want to use BEFORE you sign anything. An ounce of prevention is worth a pound of cure. And in this biz, one bad move could literally ruin your life forever. So take the time to interview your BD about financial planning software, BEFORE you sign up. Below is an old and incomplete list of Broker Dealers. We were going to keep track of which BD approved which software, but ran into a wall of whining lawyers determined to keep all of this a secret from you (so you'll be totally defenseless and on their fresh meat hook after you sign their contracts). For example, I called some and talked with compliance, and they told us, "We'll either look at and approve, or send to Finra for review, any financial planning software our Reps want to use." Then I put the text, "They'll try to approve most anything Reps want to use" next to their listing. Then their lawyers made a huge fuss. One would think this free publicity of being "good BDs" would be welcomed. The one that made the biggest fuss was InterSecurities, where the Fact Finders, IPS, Seminar, Fee-Based agreement, Retirement Software, Model Portfolios, and Asset Allocation software were ALL approved a few years earlier while I was an actual W-2 24 Rep / portfolio manager with them - for many years without any problems. That's how unbelievably broken this is! As their W-2 portfolio manager salaried employee, it took months of tedious work going through the whole approval process with them, the SEC, and Finra. We finally worked all of the bugs out and all of this Money software was eventually approved. Then they all sailed through two other BD's compliance departments after that without needing to be sent to Finra (and dozens more by customers). So I got all of these financial tools approved by them while I actually worked there as a Series 7 / 65 / 24 portfolio manager. Then later I tried to give them good publicity by saying they have a fair compliance approval process. Then their lawyer whined profusely about it! If this seems unbelievable to you, then welcome to the tip of the iceberg that is the failed Broker Dealer world. So all of that information was deleted. Sorry I can't help you figure out which BD approves which financial plan software. I tried, but the good 'ol boy collusion said no. So you're going to have to do all of this due diligence yourself BEFORE you sign up. The best advice I can give, is that if anyone at a Broker Dealer tells you they only approve the big code-driven software platforms, then you're not going to have the financial tools needed to do the jobs clients want to you to for them, and you're probably going to end up failing and ruining your life for years, if not forever. The only correct answer to this is, "We'll either look at and approve, or send to Finra for review, any financial planning software our Reps want to use." Then get this in writing, or get whomever is trying to hire you to get an actual compliance approval and/or Finra review, BEFORE you sign anything. The best thing to do these days, is just to go independent and fee-only, and not have anything to do with any Broker Dealer or Finra at all. If you're any good at what you do, then you'll learn this the hard way, and will do it yourself in a year or so anyway, as it's the natural evolution in this business. The free financial planning eBook explains pretty much all there is about this. Below is an incomplete list made around 2005. It still has a little value, so it wasn't deleted because of the lawyer problems mentioned above. It's just not going to be updated (other than BDs being removed when they go under). |
Financial Planning Software Modules For Sale (are listed below) Financial Planning Software that's Fully-Integrated Goals-Only "Financial Planning Software" Retirement Planning Software Menu: Something for Everyone Comprehensive Asset Allocation Software Model Portfolio Allocations with Historical Returns Monthly-updated ETF and Mutual Fund Picks DIY Investment Portfolio Benchmarking Program Financial Planning Fact Finders for Financial Planners Gathering Data from Clients Investment Policy Statement Software (IPS) Life Insurance Calculator (AKA Capital Needs Analysis Software) Bond Calculators for Duration, Convexity, YTM, Accretion, and Amortization Investment Software for Comparing the 27 Most Popular Methods of Investing Rental Real Estate Investing Software Net Worth Calculator (Balance Sheet Maker) and 75-year Net Worth Projector Financial Seminar Covering Retirement Planning and Investment Management Sales Tools for Financial Adviser Marketing Personal Budget Software and 75-year Cash Flow Projector TVM Financial Tools and Financial Calculators Our Unique Financial Services Buy or Sell a Financial Planning Practice Miscellaneous Pages of Interest Primer Tutorial to Learn the Basics of Financial Planning Software About the Department of Labor's New Fiduciary Rules Using Asset Allocation to Manage Money Download Brokerage Data into Spreadsheets How to Integrate Financial Planning Software Modules to Share Data CRM and Portfolio Management Software About Efficient Frontier Portfolio Optimizers Calculating Your Investment Risk Tolerance |
| BD Name | Location | Website URL | Phone |
| AIG Advisors (Royal Alliance Associates, SunAmerica, American General Securities, Sentra Securities, Spelman and Co.) | LA, CA | sunamerica.com | (800) 445-7862 |
| American Portfolios Financial Services | Holbrook, NY | americanportfolios.com | (800) 889-3914 |
| Ameritas Investment Corp. | Lincoln, NE | aicinvest.com | (800) 445-7862 |
| Associated Securities | LA, CA | associatedsecurities.com | (310) 670-0800 |
| AXA Advisors (MONY life insurance) | NYNY | axaonline.com | (212) 554-1234 |
| Berthel Fisher and Company Financial Services | Cedar Rapids, IA | berthel.com | (800) 354-5234 |
| Brecek and Young Advisors | Folsom, CA | brecek.com | (888) 777-1992 |
| Broker Dealer Financial Services (Bankers Financial Services Corporation, BFS) | Des Moines, IA | bdfs.com | (800) 352-5634 |
| Cadaret, Grant and Co. | Syracuse, NY | cadaretgrant.com | (800) 288-8601 |
| Capital Analysts | Radnor, PA | (610) 995-1500 | |
| Centaurus Financial | Orange, CA | centaurusfinancial.com | (800) 880-4234 |
| Century Securities Associates | St. Louis, MO | centurysecurities.com | (800) 488-7994 |
| Choice Investments | Boston, MA | choiceami.com | (800) 735-3756 |
| Commonwealth Financial Network | Waltham, MA | commonwealth.com | (800) 251-0080 |
| Crown Capital Securities | Orange, CA | crowncapitalsecurities.com | (800) 803-8886 |
| Ensemble Financial Services | Pittsford, NY | ensemblefs.com | (585) 419-1010 |
| Equitas America | Farmington Hills, MI | equitasusa.com | (800) 719-9160 |
| Equity Services | Montpelier, VT | equity-services.com | (800) 344-7437 |
| Financial Network Investment Corp. | El Segundo, CA | financialnetwork.com | (800) 879-8100 |
| First Allied Securities | San Diego, CA | firstallied.com | (619) 702-9600 |
| First Command Financial Planning | Fort Worth, TX | firstcommand.com | (800) 443-2104 |
| First Midwest Securities | Bloomington, IL | firstmidwestsecurities.com | (800) 662-8452 |
| Fortune Financial Service | Ohio | www.ffsreps.com | (330) 666-6360 |
| Great American Advisors | Cincinnati, OH | (800) 216-3354 | |
| Harbour Investments | Madison, WI | harbourinv.com | (608) 274-7744 |
| HD Vest Financial Services (Wells Fargo and Co) | Irving, TX | hdvest.commain.html | (972) 870-6000 |
| Independent Financial Group | San Diego, CA | ifgsd.com | (800) 269-1903 |
| ING Financial Partners | Des Moines, IA | ingfinancialpartners.com | (800) 356-2906 |
| InterSecurities | St. Pete, FL | intersecuritites.com | (727) 299-1800 |
| Investacorp | Miami Lakes, FL | investacorp.com | (800) 804-0000 |
| Intervest International Equities | Colorado Springs, CO | intervestintl.com | (719) 592-9299 |
| Invest Financial Corp. | Tampa, FL | investfinancial.com | (800) 245-4732 |
| Investment Centers of America | Bismarck, ND | investmentcenters.com | (701) 250-3300 |
| Investors Capital Corp. | Lynnfield, MA | investorscapital.com | (800) 949-1422 |
| Kovack Securities | Fort Lauderdale, FL | kovacksecurities.com | (866) 564-6574 |
| LaSalle Street Securities | Elmhurst, IL | lasalle-st.com | (630) 600-0500 |
| Lincoln Financial Advisors | Fort Wayne, IN | lfa-sagemark.com | (800) 237-3813 |
| Lincoln Investment Planning | Wyncote, PN | lincolninvestment.com | (800) 242-1421 |
| Linsco/Private Ledger (LPL Holdings) | San Diego | joinlpl.com | (858) 450-9606 |
| M Holdings Securities (M Financial Group) | Portland, OR | mfin.com | (503) 232-6960 |
| Medallion Investment Services | Severna Park, MD | medalliongroup.net/ | 410-544-8400 |
| MML Investor Services (Mass Mutual Life Insurance) | Springfield, MA | massmutual.comMMLISI/Index.html | (800) 542-6767 |
| Multi-Financial Securities Corp. | Denver, CO | multifinancial.com | (800) 929-3485 |
| Mutual Service Corp. | West Palm Beach, FL | mutualservice.com | (561) 835-4100 |
| National Planning Corp. | Santa Monica, CA | natplan.com | (800) 881-7174 |
| Next Financial Group | Houston, TX | nextfinancial.com | (713) 789-7122 |
| NFP Securities | Austin, TX? | nfp.com | (212) 301-4000 |
| National Planning Corp. | Santa Monica, CA | natplan.com | (888) 711-6720 |
| Northwestern Mutual Investment Services (Life Insurance) | Milwaukee, WI | nmfn.com | (414) 271-1444 |
| NY Life Securities | New York, NY | newyorklife.com | (212) 576-7000 |
| ONESCO (The O.N. Equity Sales Co. or Ohio National Equity Sales Company) | Cincinnati, OH | onesco1.com | (513) 794-6794 |
| Pacific West Securities | Renton, WA | pwfinancial.com | (425) 271-3550 |
| Park Avenue Securities | New York, NY | pasdirectplus.com | (888) 600-4666 |
| Pension Planners Securities | Sacramento, CA | askpensionplanners.com | (800) 722-2999 |
| Princor Financial Services | Des Moines, IA | princor.com | (888) 774-6267 |
| ProEquities | Birmingham, AL | proequities.com | (800) 288-3035 |
| Questar Capital | Ann Arbor, MI | questarcapital.com | (734) 213-6000 |
| Raymond James Financial Services | St. Pete, FL | advisorchoice.com | (800) 998-7537 |
| Royal Alliance Associates (AIG) | NYNY | royalalliance.com | (800) 821-5100 |
| Sammons Securities | Ann Arbor, MI | sammonssecurities.com | (866) 520-6869 |
| Securia Financial Services | St. Paul, MN | securianfinancial.com | (888) 237-1838 |
| Securities America | Omaha, NE | securitiesamerica.com | (800) 989-8441 |
| Securities Service Network | Knoxville, TN | ssnetwork.com | (865) 777-4677 |
| SII Investments | Appleton, WI | siionline.com | (800) 426-5975 |
| Summit Brokerage Services | Boca Raton, FL | summitbrokerage.com | (561) 338-8200 |
| The Investment Center | Bridgewater, NJ | investmentctr.com | (800) 345-8041 |
| Transamerica Financial Advisors | LA, CA | tfa.transamerica.com | (800) 245-8250 |
| Triad Advisors | Atlanta, GA | triad-advisors.com | (800) 720-4003 |
| United Planners Financial Services | Scottsdale, AZ | unitedplanners.com | (480) 991-0225 |
| USAllianz Securities | Minneapolis, MN | usallianzsecurities.com | (888) 446-5872 |
| Wachovia Securities Financial Network | Richmond, VA | wachovia.com | (877) 289-3614 |
| Walnut Street Securities | St. Louis, MO | walnutstreet.com | (877) 925-6881 |
| Waterstone Financial Group | Itasca, IL | waterstonefinancialgroup.com | (630) 250-7000 |
| WRP Investments | Liberty Township, OH | wrpinvestments.com | (800) 589-2023 |
| Woodbury Financial Services | Woodbury, MN | woodburyfinancialservices.com | (800) 800-2000 |
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