Some hidden fees are still hidden: New investment rules fail to reveal all

In this follow-up to the recent CBC "On the Money" interviews with Susan Silma, Blue ID/CRM2 Navigator, and Tom Bradley, Steadyhand Investments, CBC News outlines what fees are spelled out in the new CRM2 reports, what charges remain hidden, and why clients aren't getting the full picture. 

Susan Silma looks at whether CRM2 reporting went far enough and provides advice for investors in this CBC interview.

CBC checked in with Susan Silma, a champion for more transparent disclosure and better investor communication, for her opinion on whether the CRM2 rules had gone far enough. Susan discusses the impact and what's next on the regulatory horizon. She also recommends how investors can use the new information to talk to their advisors and learn more about the fees they're paying for advice.

Video: Why communication is crucial in the advisor-client relationship.

Over 1/3 of investors globally would switch firms simply due to a lack of communication. Does your firm's approach to communication undermine your client relationships and put your business at risk? Susan Silma and Brent Klassen discuss client expectations about timely and relevant communication. They also explore ways that advisors can use communication more effectively to satisfy client needs, strengthen relationships and reinforce the value they provide.

Video: Why goals matter when discussing client returns.

It turns out that, without guidance, clients have different expectations around returns than their advisors: clients usually expect much higher returns.  How can advisors prevent clients from being disappointed by their actual returns?

In this video, Susan Silma and Brent Klassen discuss the importance of helping clients make their goals more concrete, and explore the opportunity of using returns to help clients track progress toward their goals.

Video: Where is the money in motion and what's at risk?

Many clients have received their CRM2 Reports by now. Even if advisors haven't had a lot of negative feedback from clients, does that mean there's no cause for concern or is it too soon to tell? Susan Silma and Brent Klassen discuss the impact of CRM2 reporting, client expectations, and potential pitfalls. They provide tips for how advisors can reinforce the value they provide and minimize the risk of money in motion.

Did your firm's CRM2 Reports make the grade?

Did your firm's CRM2 Reports make the grade?

See how your firm compares to industry peers with a CRM2 Report Card. Now that many of the CRM2 reports have been sent out, there’s a great deal of industry interest in the look and content of other dealer firms' reports ... and their impact on the client experience. At CRM2 Navigator, we’ve analyzed a wide range of CRM2 Reports and can assess the strengths and weaknesses of your firm's approach to CRM2 reporting with a customized CRM2 Report Card. 

Have your clients received their new-look statements yet?

“It’s imperative that advisors be proactive and don’t shy away from having conversations with their clients,” Silma says. “They should take the lead in these conversations and steer them through the fee reports, not just wait for the client to ask questions.”  Susan Silma, Partner at CRM2 Navigator

With the majority of investors having now received their new-look statements, many advisors will have clients who are struggling to understand what they see ... there’s little doubt that many investors will be looking for answers from their advisor.

IFIC calls for a consistent approach to KYC and suitability

IFIC filed a submission emphasizing the importance of a robust suitability process in response to IIROC’s proposed guidance on order-execution only (OEO) services and activities. In a recent article, Wealth Professional highlights IFIC's comments.

“There is currently no advice gap in the context of mutual funds because funds can be purchased through a bundled fee model at a cost that is affordable to investors regardless of account size. A mutual fund account can be started today for as little as $25 per month. Many small investors would lose the ability to obtain advice for a nominal amount if bundled fees were prohibited.”  IFIC president and CEO Paul Bourque

CRM2: Don’t wait for your clients to ask about fees and performance.

Many financial firms across the country have started mailing out the new CRM2 Fee and Performance Reports. When clients review their reports, some advisors may face tough questions ... especially from clients with sticker shock over their fees. Or, worse yet, what about the clients that advisors don’t hear from? That doesn’t necessarily mean they don’t have any questions. Whether you talk to your clients now or over the next few months, here are some suggestions to help you have comfortable, confident conversations about fees, performance and the value you provide.

New fee-reporting rules will lead to investing industry shakeout

Susan Silma of CRM2 Navigator shares her insights into the impact of CRM2 on investors and advisors in this recent article in The Globe and Mail. It is fair to say that in Canada, January is the cruelest month. The days are cold and dark, holiday bills start coming due and tax season begins. This year is sure to bring more grim tidings to most Canadian investors – and the advisers who serve them. For most investment firms, this month is when they must start presenting clients with detailed reports on the fees that they have charged their clients.

It's crunch time for CRM2: here's what advisors can do to prepare clients.

The financial industry has been talking about CRM2 for months … and now it’s crunch time. Any day now, crisp new CRM2 fee and performance reports will be landing in the laps of investors revealing previously invisible information. These transparent reports will give investors new insights into the cost and performance of their investments. Are you prepared for the potential reactions of your clients? Do you know the best way to talk to them about their new CRM2 reports? Here are three things advisors can do right now to prepare their clients.

What will (and will not) be included in your new CRM2 annual investment reports

Globe and Mail video: Drawing Conclusions What will (and will not) be included in your new annual CRM2 report

Globe and Mail video: Drawing Conclusions

What will (and will not) be included in your new annual CRM2 report

Investors will start receiving CRM2 annual reports in January 2017 that show what they're paying for their investments in dollar terms. In this video, find out what costs will (and will not) be included in these reports.

>Watch the video

Webinar series: How advisors can capture money in motion for 2017

Want to know how to capture money in motion and turn the new CRM2 fee and performance information into an opportunity with your clients? Susan Silma, co-founder of CRM2 Navigator, outlines how advisors can leverage CRM2 and be on the winning side of money in motion in this 10-module webinar series developed by the Investment Industry Association of Canada (IIAC).