Choosing A Financial Services Thats Appropriate For You


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Choosing A Financial Services Thats Appropriate For You

  1. 1. Strategically speaking … Choosing a financial services relationship that is right for you. Generally, brokers will not make investment decisions Understanding brokerage services, for you but may offer recommendations about which securities to buy, hold or sell. The recommendations investment advisory services and are often made on a transactional basis. Brokers must financial planning. know key facts about your financial situation and then make suitable recommendations based on those facts. As you consider your immediate and long-term “Suitable” means that the broker has asked you about financial needs, you may ask “What type of your basic financial and tax status, including current financial services relationship is right for me?” investments, income and net worth; your tolerance for There are different types of services: brokerage risk; investment experience and the expected amount services, investment advisory services and of time you plan on holding the investments. Using this financial planning. They are different not only information, they can recommend a specific product in terms of the services provided, but also the or service. different obligations of the firm that provides those services. Ameriprise Financial can help Brokers can also provide investment guidance you understand these types of services so you beyond the scope of buy/sell/hold recommendations feel comfortable with your approach as you seek on individual securities, such as providing investor to reach your financial goals. education, investment research, basic financial analyses and advice on an asset allocation* strategy based on Whatever approach you choose, we believe that the suitability information described above. Typically, you your needs can best be served by someone are not charged a separate fee or commission for this who understands your goals and supports guidance because it is part of, and incidental to, your dreams. This may include helping you the brokerage services. Brokers must also: plan to achieve your goals and recommending appropriate investments for your situation. > Treat you in a fair manner characterized by high Financial recommendations should take into standards of honesty and integrity. consideration your risk tolerance, time horizon, overall financial objectives, tax situation and > Conduct due diligence on any security so they have any financial constraints. a reasonable belief that any recommendation made is “suitable.” > Seek to execute all orders in the best available Brokerage services market by taking into account all relevant facts and Brokerage services include a range of services related circumstances such as order price, order size and to investing in specific securities — such as stocks, trading characteristics of the security involved. bonds and mutual funds — which are held in a brokerage When working with brokers, you should also know that account. These services are provided by a broker-dealer their obligation to tell you about their business, conflicts through a registered representative who, acting as your of interest and other matters is more limited than if they agent, can buy and sell securities on your behalf, and were to have a fiduciary relationship with you, like an provide periodic reports regarding your transactions and investment adviser. the value of your holdings. *Asset allocation is the process of dividing investments among different kinds of assets such as stocks, bonds, real estate and cash to optimize the risk/reward trade-off, based on your specific situation. Asset allocation does not assure a profit or protect against loss in declining markets.
  2. 2. Investment advisory services When you engage the services of an investment adviser, you will enter into a written agreement and receive a Investment advisers provide analysis and advice by brochure that contains important information about the making investment recommendations or providing adviser and their business. The agreement acknowledges research and/or opinions to their clients on securities and governs the advisory relationship and outlines the or markets. Investment advisers may also provide investment adviser’s obligations to you. The brochure you with asset allocation strategies based on your includes information about the adviser’s business financial and tax status. These services are provided model, the scope of services provided, fees you will pay through investment adviser representatives who are and possible conflicts of interests that may affect the responsible for providing investment advice and suitable advisory relationship. recommendations to clients on an ongoing basis throughout the term of the adviser-client relationship. Ameriprise® financial planning The Investment Advisers Act of 1940 and applicable For many consumers, reaching long-term financial state laws impose a different, higher set of regulatory goals through an investment advisory service is a solid standards on investment advisers than broker-dealers. approach to take. Financial planning typically differs from Sometimes, you will hear them referred to as having other types of investment advisory services because of a “fiduciary” relationship with you — this means an the breadth and scope of the advisory services provided.* investment adviser has the responsibility to act in your When you engage in a financial planning relationship, best interests. In addition to having the same obligations you benefit from a comprehensive, ongoing process that as brokers, investment advisers must also: helps you achieve your goals. > Act in your best interests when providing you Financial planning is the process of meeting your with investment advisory services. financial goals through the disciplined management of your finances. Financial goals can include buying a home, > Place your interests above their own. saving for education costs or planning for retirement. > Avoid or disclose any material conflicts of interest, including disclosure of compensation paid to or received from affiliates as a result of the advisory relationship or any recommendations made in connection with the advisory services. * Securities and Exchange Commission 17 CFR Part 275 Defining your dreams The Ameriprise Financial Dream > Plan > Track >® Our one-to-one, Identify/prioritize approach to financial planning. face-to-face objectives We’ll discuss financial planning your dreams, Our unique and collaborative Dream > Plan > Track > approach process goals and needs to financial planning takes a holistic look at your financial to develop a clear vision, starting with a comprehensive understanding of your vision of your financial future. needs, goals and dreams. Ameriprise Financial cannot guarantee future financial results.
  3. 3. The financial planning process consists of six steps Taking action on the proposed strategies and that help you take a “big picture” look at where you recommendations is part of the process and can help you are financially. It is an ongoing process, defined by the reach your financial goals. Once your Ameriprise financial Certified Financial Planner Board of Standards, Inc., advisor has analyzed your situation and proposed designed to help you meet your immediate and long-term strategies and recommendations that are aligned with financial goals. Using these six steps, you can identify your goals, needs and priorities, you can decide how to your objectives, define your current situation, evaluate take action on your plan. how much you need to reach your goals and determine what you need to do to help reach them. Typically, you have a choice of financial services providers with whom to implement the recommendations via At Ameriprise Financial, we believe financial planning is a transaction-based brokerage account, a fee-based a long-term, collaborative relationship, delivered through investment advisory account or a combination of both. a one-to-one financial planning process. We’ll work The protection you receive from a financial planning together to define your dreams, develop a plan to help relationship does not extend to any existing brokerage you get there, then track your progress along the way, accounts or the implementation of a financial plan, unless recommending changes when needed. you decide to continue the relationship after you receive your initial recommendations from the same provider. Financial planning provides direction and meaning to your financial decisions. It helps you understand how It is also important to revisit your financial and life goals each financial decision can affect your other goals. For regularly, monitor your progress toward them and make example, using a specific investment strategy might adjustments to help you stay on track. At Ameriprise help you buy something in the future, but it may have a Financial, we encourage clients to have an ongoing negative impact on your current lifestyle, protection needs planning relationship because research shows they or other future goals. By viewing each financial decision are more confident and optimistic that they will achieve as part of a whole, you can consider the impact on your their dreams and financial goals than people who don’t. entire financial situation. Reference the summary box on the back page for a complete comparison of service options. To learn more about which type of financial services relationship is right for you, talk with your financial advisor. If you don’t have a financial advisor, call us at 1-800-AmerIprIse or visit to learn more. Developing your plan Tracking your progress Gather Analyze propose Take action information information recommendations Once we propose We’ll review We’ll work We’ll provide specific financial important together to written financial solutions to help Track ongoing progress documents such understand the planning you reach your Because your goals and as brokerage and big picture of recommendations goals, you can needs evolve over time, bank statements, your financial that align with your take action on it is important to track tax returns, situation, and goals and needs. your plan. your progress as part of insurance policies how the different an ongoing process. and retirement elements may plans. impact each other.
  4. 4. As you evaluate which type of financial services relationship is best for you, ask yourself these important questions: > What services are you using today? > What do you want to focus on? > How do you plan to reach your dreams and goals? > Do you want assistance with a few targeted areas or are you seeking a more holistic approach? > How involved do you want to be in investment decision-making? summary comparison of services Brokerage services Investment advisory services Ameriprise® financial planning services > Act as your agent > Offer advice, not just > One form of investment advisory services that to buy and sell brokerage provides in-depth analysis of your financial securities goals and needs in a holistic and integrated way > Provide investment advice > Provide and analysis on securities > Provides advice on strategies and recommendations investment advice by making buy/hold/sell designed to help you plan to achieve your desired incidental to recommendations (may financial objectives and goals brokerage services also include providing research and/or opinions) Financial > Specific > Investment strategies and Gain an understanding of your current situation by topics investments recommendations for reviewing your: assets under management > Financial position > Protection needs > Basic estate needs Some or all of the following depending on your priority goal(s): Goals to track over time Funding education Funding future goals Funding retirement Transitioning to retirement Retirement income Additional financial planning areas: Investment planning (all assets) Income tax planning Employee benefits planning Estate, legacy or multi-generational planning Small business owner planning Fees you pay* > Sales loads and > Generally, an asset-based > Fixed or flat fee for the duration of the agreement and commissions** fee the financial planning services provided > Fee amount varies based on the complexity of your situation, your needs and the advisor’s experience relevant laws > Securities and > Investment Advisers Act > Investment Advisers Act of 1940 Exchange Act of 1934 of 1940 Obligations > Provide suitable > Provide suitable > Provide suitable recommendations and act in your to you recommendations recommendations and act best interests in your best interests At Ameriprise Financial, we offer all of these services and can help you decide which ones are right for you. * If you engage in multiple services, you may pay a separate fee or combine fees for each service or transaction. ** Although some firms have offered fee-based brokerage accounts, recent court decisions have called into question the legal status of such programs. Financial planning services and investments offered through Ameriprise Financial Services, Inc. Member FINRA and SIPC. © 2006–2008 Ameriprise Financial, Inc. All rights reserved. 290217 E (5/08)