Unfortunately, credit union advisors exist who have been trained to be "GDC (gross dealer concessions) Junkies." Some programs even promote proprietary, high commission, or easy-to-sell products even though they may not be in the member's best interest. In addition, some credit unions are using "free financial plans" as a means to sell more mutual funds and annuities. While some are using "advisory" services to move people from paying 0.25% to paying 1.00% under the guise of "fee-based planning." The truth is in most cases the member is not getting additional value and has already paid a full commission for the same relationship. If your advisor is winning awards for his/her advisory production, take a close look at how they are getting there.

If the credit union industry wants to be seen as financial advocates in the communities that we serve, then we must look at extending fee-based and fee-only options to our members.

Will members actually pay for advice that has been promoted as "free" for years?

As is with most things in life, "you get what you pay for" rings true when seeking professional advice. Would you go to a free doctor, lawyer, or accountant for your important health, legal, and accounting needs? Marketing "free" sends the wrong message to members who are looking for help with their finances.

There are several reasons why 66% of the Fidelity respondents said they would prefer to pay an annual fee to an advisor to monitor their retirement income plan. In a separate 2007 Wall Street Journal survey, respondents stated the top reasons for using a financial advisor were:

-Belief a professional would do a better job,

-Making sure the money will last through retirement and

-Rolling over a retirement plan.

So, what can we learn from the Fidelity and Wall Street Journal surveys on providing financial advice for a fee? For those who have read the Jim Collins books Good to Great and Built to Last, the priorities we need to take as our members' financial advocates are clear:

People: Lead with the "right people." The financial advisors and those who manage them must have consistent values with the credit union leadership. Ironically, there is more resistance to charging fees for advice from the old school commission reps than there will be from the members.

Processes: Embrace the independent, fee-based, and fee-only planning models. This will require confronting the "brutal facts" surrounding the current program. Ask, "would I put my money with this advisor," and "would I refer this Advisor to my best friends and family." Do we receive strong compliance support and management from our current vendor?

Profits: If you lead with the right people and surround them with independent processes, the profits will follow. Fee-based planning, provides members with more options and also helps the credit unions' bottom line in many ways:

-Fee-based advisors typically go deeper into the relationship than investment reps. They will get to know the member and their family, leading to new members and cross-selling opportunities.

-New sources of revenue are developed through planning, such as consolidation loans, re-financings, trust services, and insurance services.

-The actual fees being charged should always be a value to the member. Research your area and see what other independent advisors are charging for financial planning services and charge less.

Rolling out fee-based planning will not work if you have the wrong people in the wrong seats. The recruitment and training of the financial advisors is critical.

Fee-based and fee-only planning should be a growing focus in your financial services program but it will never be the solution for everyone. The majority of the members will still choose the more traditional and transactional model until they reach a time in their life when they value professional advice.

Credit unions should offer traditional, fee-based, and fee-only models for their members. With social security, pensions, health care, and longevity weighing heavily on the minds of our members, it is our opportunity and obligation to be their independent financial advocates providing unbiased financial education and advice.