June is an exciting month. The Jazz Festival comes alive. Bard on the Beach resonates with our hearts. And, summer officially kicks off.
More exciting still are the new disclosure regulations being launched by the Canadian Securities Administrators (CSA). Alright, perhaps “exciting” is a stretch (though this is to me).
Beginning June 13th, clients will receive a 2-page summary when a new investment fund has been added to their account – instead of an unwieldy 50+-page prospectus.
As a result, returns – as well as costs – will be laid out clearly and openly for you.
New year. New reasons to celebrate.
Better yet, starting next year, advisor compensation and management fees will be listed on statements.
At present, statements display net returns after fees paid.
Typically, advisors are paid an ongoing 1% service fee; investment companies gets 1.5% for a total fee of about 2.5%. Given how standard the fees are, it may not seem like a relevant change. Yet, the real difference between advisors is not in their prices. It’s in the value they provide through their breadth (or lack of) services.
We provide full financial planning, annual reviews and a host of other services. We also go the extra mile to answer questions on an ongoing basis. So, as someone who’s part of a team of true service providers, I’m delighted with this transparency. It allows clients to comparison-shop and make informed choices about who to trust with so critical a responsibility.
On the subject of full disclosure, I’ll admit that I’ve voiced my displeasure about all advisors being painted with the same brush (when I rant, my voice never raises but my hands fly everywhere!).
Now, thanks to the new regulations, clients will finally be able to see for themselves.
When New Year’s comes around, guess who’ll be celebrating?