Regardless of the CRM2 extension, the onus is undeniably on embedded-commission advisors to prove their worth, caution their fee-based counterparts.
“I do believe that firms will have to offer more and really start to earn their compensation and maybe that takes them expanding services,” said Rona Birenbaum, a wealth advisor with Caring for Clients and a member of the WP Top 50. “We have to develop to accommodate what we’re seeing in the marketplace.
“Some advisors have to take more of a comprehensive approach to how they help people manage their money.”
The comments echo those of other fee-only advisors, coming the same day the industry saw the deadline for implementation of the second phase of CRM2 extended till the end of the year. The third and final phase, of course, goes ahead as planned on July 15, 2016.
But meeting those disclosure requirements is only part of the challenge for those firms and advisors relying on embedded commissions, say fee-based players, who suggest an overhaul of the traditional model may also be necessary in the CRM2 world of 2017.
With technology strong and a plethora of options out there in the market, advisors will inevitably have to prove their worth more than ever as consumers, clients and investors consider a do-it-yourself approach.
Those challenges come on top of the many associated with CRM2.
The changes announced by the CSA provide more time in 2015, which is much appreciated, says advisors, but the overall time for full-implementation remains the same.