In the latest in SIFMA’s podcast series, SIFMA president and CEO Kenneth E. Bentsen, Jr. is joined by Jason Plank, a financial planning professional on the independent platform with Ameriprise Financial in Edina, MN. During their conversation, Jason explains his work on behalf of his clients and community as an independent financial advisor, and why his independent contractor status is important to that work.

Nationwide, approximately 150,000 registered brokers and investment advisors operate their own financial advisory firms utilizing the independent contractor model. A bill currently under consideration in Congress known as the ‘PRO Act’ would change how independent contractor status is determined, adversely impacting these hundreds of thousands of independent financial advisors, including Jason.

As explained in the podcast, SIFMA is encouraging lawmakers to exempt independent financial advisors from this legislation. Narrower, more focused legislation would avoid the unintended consequence of capturing traditional business models.

Transcript

Edited for clarity

Ken Bentsen:  I’m Ken Bentsen, President and CEO of SIFMA. Welcome to the SIFMA Podcast. Thank you for joining us for this episode in the SIFMA Podcast series. I’m joined today by Jason Plank, who is a financial planning professional on the independent platform with Ameriprise Financial in Edina, Minnesota. Jason holds an MBA and a Certified Financial Planner certification and is a private wealth advisor on the independent platform.

With 19 years of experience in financial planning, he’s been named as one of Forbes Best in the State Wealth Advisors in 2021 and Forbes America’s Top Next Generation Wealth Advisors in 2018.  His focus is working with physicians, corporate executives, and entrepreneurs through comprehensive financial planning. In addition, Jason currently serves on the Board of Directors of the Financial Planning Association, the principal membership organization for the CFP professionals and those who support the financial planning process.

With a passion for helping others, Jason volunteers his time to assist Minnesota students to learn financial literacy and career skills. So with that, let’s get started. Jason, thank you so much for joining me today. In a minute, we’ll dive into a discussion about a piece of legislation before Congress that could have an impact on your business. But before we do, could you tell me a little bit more about yourself, your career arc as a financial advisor? And again, I’d really like to hear about your work with your clients in the community.

Jason Plank: Absolutely. Well, first of all, thank you for that kind introduction. As far as my background, I started my career as a financial advisor in 2002, initially actually joining the Ameriprise employee channel, and then throughout that time, learning, training, getting prepared as an advisor, helping work with clients. I moved into a formal leadership role on the employee platform with Ameriprise as a District Manager from mid-2004 through late 2007.

And then I got out of the formal leadership role and, in 2008, I actually transitioned over to the Ameriprise independent platform with my business partner to provide more flexibility and control on how we serve clients. Our team here in our office, we have seven people to help serve all the clients that we take care of, to plan for their goals, whether it be funding their kids’ education, planning for a comfortable and confident retirement, making sure that they’re being prudent and smart with their investments and making sure they align with their goals and their risk profile.

So we have two private wealth advisors, one associate advisor that’s preparing to take their CFP exam. We also have a licensed Paraplanner that has not only their CFP certification but also their CFA or Chartered Financial Analyst designation. Then we have three unlicensed support staff, which is really important to help support all the work that we do because I couldn’t do it all by myself. We need to have great people, great talented individuals to help serve the clients and their unique goals that they want to accomplish in their life.

As far as in the community, as you mentioned, I serve on the National FPA or Financial Planning Association Board of Directors. I’ve been on the Board here for a little over two years. I served as local president here in Minnesota of one of the chapters for FPA, and then I’m currently serving as treasurer for the FPA here nationally.

Locally here in Minnesota, I’m on the Best Prep Board of Directors. It’s a local Minnesota nonprofit. And really, that nonprofit helps students prepare for career and success in life through business skills, financial literacy skills, career skills, college readiness, all those things, both in the classroom and then now obviously virtually as well, given everything here in the past year.

Ken Bentsen: That’s great. You bring an incredible perspective, both as a — or not both, but in terms of having come up through the employee channel, now building your own business, which is quite some business in talking about the partners and employees that you have, and then your work in the community. And we learn this every day, and you see it every day, obviously, the importance of financial literacy and the impact that can have on individuals in the community at large.

In your comments, you talked about, as I said, coming up the employee channel and then choosing to go on to the independent route. So that really gives to a very clear perspective of the differences. And not to say one model’s necessarily better than the other. Many people choose both. But maybe dig in a little more detail of how you decided that you wanted to have your own business and what that meant for your clients.

Jason Plank: I think to start with that, it’s important to have a choice. And I’m very glad that Ameriprise provides that flexibility for the advisor to choose whether it’s going to be best to be on an employee platform or on an independent platform. And for me and my team, being on the independent platform just allows more flexibility in how we can serve our clients. This includes what level of staffing support that’s going to be best to provide a high-quality client experience, what we want our technology set up to be, and even what we want our real estate footprint to look like.

For example, we wanted to have our own independent office environment just for our team that will help support all the work that we do to help clients achieve their goals. And then this way, our clients get to know all of our team members, and it’s a smaller office environment versus a larger branch setting with many different advisors. And for us, that helps foster more of that family or personalized experience that a client may experience in working with us.

As you mentioned, it’s not saying one approach is good or bad, more so just describing what works best for us and really why it’s imperative for us to have that flexibility to make that choice, to help our clients serve them really well, look out for their best interests, help them plan for their financial goals and their future is really having that choice.

Ken Bentsen: Well, that’s an important point that you bring up because one of the things that we’re concerned about is legislation before Congress that is designed to change the labor laws as it relates to who is defined as an independent contractor, and therefore, it would affect the independent contractor status. And it’s a very broadly written piece of legislation, which we are concerned, as written, could negatively impact the status that you and approximately 150,000 other registered brokers and investment advisors who operate in their own financial advisory businesses nationwide would be impacted by.

The bill known as the PRO Act, which has passed the House and now will be considered by the Senate, as I said, would change that status under the National Labor Relations Act and really could adversely impact 150,000 independent advisors. And were this to become law, depending on how regulators would interpret the legislation, the bill could reclassify you and the others as an employee of the firm whose platform you’ve actually chosen to use as an independent contractor.

As you think about that, both your own business, your competitors who are also utilizing independent contractor status, how would that affect you? How would that affect your business if you could no longer operate as an independent contractor?

Jason Plank: As I mentioned before, it’s important to continue to have the choice in the matter and have that independence to provide the flexibility of how we serve our clients best because, as an employee, that might limit the ability of how much staff I might choose to hire within my own business so we can serve our clients the right way and with the right level of support.

And each different advisory practice is going to look at this differently depending on their geography, the type of clients they serve, their preferences, client expectations and needs depending on their complexity. I don’t think it’s a one size fits all. And so like when I look at the 150,000 independent advisors, as you mentioned, Ken, within the industry, and even of the 10,000 advisors that are in Ameriprise, over 75 percent of them have chosen to be on the independent channel.

It’s very clear that many and I would say most financial planners and financial advisors would prefer the independent channel as an option to help clients serve them well and help them plan for their future. And ultimately, the reason I think there should be an exemption specific to our profession is it allows each advisor to tailor their service and support structures to best meet the needs of their clients.

As I mentioned, each geography, client circumstances will dictate kind of what needs are in in terms of supporting clients. And ultimately, that’s why I’m in this business, and that’s why we do what we do is to help clients. And adding additional restrictions to how we go about doing that as far as operating in an independent and flexible way, I think, would be a negative overall when it comes to this PRO Act.

Ken Bentsen: Well, Jason, thank you, first of all, for speaking with me today. And more importantly, thank you for explaining how financial advisors use the independent contractor status and, in particular, the really unfortunate and I believe probably unintended but really unfortunate impact that the PRO Act would have on this important sector of financial advice if the bill moves forward without a clear exemption for financial advisors.

I really appreciate your taking the time to be with us today. As we talked at the front end of all you do, both in running your business and your volunteer work, you’re a busy individual. So we appreciate your giving us a little bit of your time. And to learn more about SIFMA and our work to promote effective and resilient capital markets, please visit us at www.sifma.org. And thank you very much.

—

Kenneth E. Bentsen, Jr. is president and CEO of SIFMA, the voice of the nation’s securities industry. He is also chief executive officer of the Global Financial Markets Association (GFMA).

Jason Plank is a private wealth advisor and Certified Financial Planner^TM practitioner for Ameriprise Financial Services, Inc.