Referrals to Financial Advisors

1. Referrals to Financial Advisors • Welcome to the webinar that describes why CPAs, attorneys, and other Centers of Influence refer clients and others to financial professionals who are profiled in the Paladin Registry • Webinar Duration • Number of slides: 17 • Viewing Time: Approximately 7 minutes • Jack Waymire, Narrator • 31 years of financial industry experience • Author of the best selling book “Who’s Watching Your Money?” • Co-founder, PaladinRegistry.com

2. About Paladin • Paladin is an independent information services company; not a financial services company • The Registry is a unique source of objective information about financial advisors, planners, and firms • No advisor or firm has an equity interest in Paladin • No advisor or planner is employed by, licensed by, or affiliated with the Paladin Registry • Paladin is not licensed to sell any investment products

3. Paladin Research • Paladin has surveyed more than 4,000 consumers to obtain factual information about their range of experiences with advisors and planners • Paladin received input from more than 550 financial professionals about their range of experiences with consumers • Paladin combined the input from both sources to develop the content of this webinar

4. Client Needs & Assumptions • Based on extensive Paladin Research, there are four reasons why your clients and other people ask you to refer them to financial advisors and planners: #1. It’s an easy way for them to find financial professionals #2. They don’t know where else to go to find advisors #3. They don’t have to do any work evaluating advisors #4. They assume you know the best advisors because you or your other clients already use their services

5. Expectations = Pressure • Research also shows clients have expectations when you refer them to financial professionals. They expect your referrals to: • Have high degrees of competence and ethics • Put their financial interests ahead of their own • Have investor-friendly business practices • Produce above average results • Client expectations can create pressure: • First, there is the pressure to help your clients find quality advisors • Then, there is the pressure to help your clients avoid the risks and consequences of bad financial advice • Then, there is the pressure that your clients may be negatively impacted by the advisors that you referred them to

6. Advisor Expertise • Unfortunately, there is no easy way to determine advisor competence. For example: • 90% of advisors are sales representatives (reps) who are paid commissions to sell products; they are not paid to help your clients achieve their goals • Advisors don’t have audited track records • There is a broad range in the quality of advisors • All sales reps claim to be ethical experts even when its not true • Sales reps use titles, for example planner or advisor, to help them maximize their sales of investment and insurance products • Reps do not provide any written documentation for their claims of financial expertise

7. Advisor Ethics • Advisor ethics are even more difficult to measure • All advisors claim to be trustworthy. Like expertise, this claim helps them sell their products and services • Investors should go to www.nasd.org to view the advisors’ compliance records. However, the records don’t show: • Conflicts of interest • Advisors selling products that make them the most money • Advisors using titles, they have no right to use, to sell more products • Advisors hiding information from consumers that would interfere with their sales processes

8. Advisor Results • Money managers have track records because they provide the same service to multiple clients • Advisors do not have track records because their services vary by client • Advisors try to create track records by: • Selling hot products that they selected after the performance occurred • Providing references that describe the results that the advisor produced for them • Showing consumers sample performance reports • Advisor s’ past results cannot be documented

9. Just Say No • Refusing to provide your clients with advisor referrals is an easy solution; it’s just not the best solution • There are several reasons why you should help your clients find and evaluate financial advisors and planners • Without help, your clients will be prone to selecting bad advisors because they don’t know how to determine advisor quality • You want to help your clients avoid the risks and consequences of bad financial advice • You want to help your clients achieve their financial goals • You don’t want your clients going to your competitors for help • You may also have common clients with the advisors in the future

10. The Registry Solution • You can help your clients find and select quality advisors by referring them to a local, five star member of the Registry • Paladin screened the advisor for you • They can view the professional profile of this advisor • They can use the Registry’s educational content to learn more about advisors • And they can print copies of the advisor’s profile and other documents so they have a permanent record

11. Paladin Registry Facts • The website URL is www.paladinregistry.com • More than 700,000 consumers have used Registry services since April, 2005 • The Registry received Kiplinger’s highest quality rating for its service category • CBS Marketwatch called Registry services the perfect solution for consumers who didn’t know where to find advisors and how to determine their quality

12. Registry Services • Information Center - Consumer education for selecting quality advisors and avoiding bad advice • Search Service – Matches consumers to pre-screened, five star planners and advisors • Documentation Service – Comprehensive information for advisor credentials, ethics, business practices, and services • Rate Your Advisor – A questionnaire and evaluation system for rating non-Registry advisors

13. The 90/10 Rule • A financial professional introduced you to the free public services in the Registry • The professional is a member of the Registry and an advocate for competent, ethical financial advice • Less than 10% of advisors who contact us have credentials, ethics, business practices, and services that meet the Registry’s high minimum standards for admittance • More than 90% are rejected because they don’t meet Registry standards for competence and ethics

14. Registry Professionals • Advisors who are profiled in the Registry have these characteristics in common: • They provide competent financial advice • They have ethical business practices • Their clients interests always come first • They are acknowledged fiduciaries • They are compensated with fees • They provide sophisticated financial services • They provide voluntary documentation and disclosures • The achievement of client goals is their number one priority

15. The Need for Documentation • Non-Registry advisors use sales skills and personalities to convince clients to trust them with their assets • Their verbal information is easy to misrepresent • It’s also easy to omit verbal information • Clients have no written record of what was said to them • Verbal information is easy to deny later • On the other hand, Registry profiled advisors provide comprehensive, written documentation for their credentials, ethics, business practices, and services

16. What’s the Cost or Catch? • There is no cost • All Registry services are free to the public • We have nothing to sell consumers • There is no catch • Your clients don’t have to register to use three of the four Registry services for consumers: Information Center, View Documents, and Rate Your Advisor • Registration is required for the search service so we can send them their results

17. Summary • Now you know there’s an alternative that helps you satisfy your clients’ needs for competent, ethical financial advice • You can refer them to the education, search, and documentation services on the Registry website • You will be providing a value-added service that also helps you avoid the risk of bad advisor referrals • Thank you!