Podcast Summary: "Pam Krueger: How to Find a Financial Advisor" on The Long View

Introduction

In the February 11, 2025 episode of The Long View, host Christine Benz engages in an insightful conversation with Pam Krueger, the founder and CEO of WealthRamp. Pam shares her expertise on navigating the complex landscape of financial advising, offering listeners valuable strategies for finding the right financial advisor to meet their unique needs.

The Challenge of Finding a Financial Advisor

Christine Benz opens the discussion by addressing a common dilemma: the difficulty individuals face in locating a suitable financial advisor. Pam elucidates the problem, highlighting the sheer number of self-identified financial advisors in the U.S.—between 400,000 and 500,000—and the lack of an organized system to help consumers find the right fit.

"There's almost half a million individuals in the United States who self-identify as a financial advisor. When you're an individual investor and you're looking for help, there's no organized way to find the advisor who's going to be the right fit for you."
— Pam Krueger (02:00)

Introducing WealthRamp: A Solution to the Chaos

Pam discusses the inception of WealthRamp, a platform designed to streamline the process of matching consumers with vetted financial advisors. Initially hesitant to tackle such a massive issue, Pam was motivated by the feedback from her viewers on the PBS series MoneyTrack, who sought transparency and guidance in selecting advisors.

"WealthRamp matches individuals to maybe as many as three recommended advisors that really fit their particular preferences and their profiles. It’s done in a very private way, protecting the consumer from unsolicited outreach."
— Pam Krueger (05:30)

The Importance of Fee-Only and Fiduciary Standards

A significant portion of the conversation centers on the distinction between fee-only advisors and those operating under commission-based models. Pam emphasizes that fee-only advisors derive their income solely from clients, eliminating conflicts of interest inherent in commission-based structures.

"Fee-only means the advisor's fee is only from the client. They work only and directly for clients, not for a brokerage firm or an insurance company. This aligns their interests with the client's best financial interest."
— Pam Krueger (09:47)

She further clarifies the fiduciary standard, explaining that registered investment advisors (RIAs) are legally obligated to act in their clients' best interests, a commitment that sets them apart from brokers who are held to a suitability standard.

"Registered investment advisors are legally bound to act in the individual investor's best interest in a fiduciary capacity. This is a much higher standard than the suitability model that brokers adhere to."
— Pam Krueger (11:45)

Navigating Credentials and Designations

Christine and Pam delve into the various certifications and designations that financial advisors may hold, such as Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), and Certified Public Accountant (CPA). Pam advises consumers to look beyond the "alphabet soup" of credentials to understand an advisor's actual capabilities and experience.

"CFP is a baseline. Every advisor on WealthRamp is either a CFP or has accomplished a body of work that goes way beyond CFP, such as being a CPA or CFA with extensive experience."
— Pam Krueger (28:07)

Exploring Fee Models: Beyond Assets Under Management (AUM)

The discussion shifts to the various fee structures within the fee-only paradigm. While AUM is common, Pam expresses a preference for diverse fee models like hourly rates and retainer fees to accommodate clients with different financial situations.

"Two-thirds of the people who come to WealthRamp don't want to pay on an asset under management basis. They seek alternatives like retainer fees or hourly rates to suit their specific needs."
— Pam Krueger (38:53)

She outlines scenarios where different fee models are appropriate, emphasizing that fees should correlate with the time and complexity of the services provided rather than being a fixed percentage of assets.

"Whether it's hourly, retainer, or AUM-based, all fees are established based on time and complexity, often landing around the equivalent of 1% of the assets advised on."
— Pam Krueger (32:56)

Due Diligence and Regulatory Oversight

Pam provides guidance on conducting due diligence when selecting a financial advisor, recommending tools like BrokerCheck by FINRA and the SEC's website to verify an advisor's regulatory history and credentials.

"The very first stop is BrokerCheck.com by FINRA to see if there are any disclosures or complaints. If the advisor is a registered investment advisor, you'll then check the SEC's website for their records."
— Pam Krueger (44:00)

She cautions against hybrid advisors who straddle both fiduciary and suitability models, advocating for clarity and transparency in an advisor's compensation and regulatory status.

"Fee-only and fiduciary standards must be upheld rigorously to protect consumers from advisors who might have conflicting interests."
— Pam Krueger (43:45)

Key Questions to Ask Potential Advisors

Pam outlines essential questions consumers should pose when interviewing potential financial advisors to assess their suitability and alignment with the client's goals.

"Ask the advisor to describe their most difficult clients and the problems they help solve. Then inquire about their fee structure—whether it's based on AUM, retainer, or hourly rates."
— Pam Krueger (30:55)

The Future of Financial Advice

Looking ahead, Pam envisions a financial advisory landscape that leverages technology to enhance client-advisor relationships, making advice more accessible and less transactional. She anticipates that advancements in software and planning tools will empower both advisors and clients, fostering deeper, more meaningful collaborations.

"Technology has transformed financial advice from transactional to relational, enabling better conversations and more robust advisor-client relationships."
— Pam Krueger (46:47)

Conclusion

Christine Benz wraps up the episode by acknowledging the complexity of finding a trustworthy financial advisor and commending Pam's efforts in simplifying the process through WealthRamp. Pam reiterates her commitment to education and personalized matchmaking, ensuring that consumers can make informed decisions without being overwhelmed by the cluttered advisory marketplace.

"When you decide that you want to work with an advisor, WealthRamp is here to help you find the best possible fit, eliminating the noise and focusing on meaningful conversations."
— Pam Krueger (50:08)

Notable Quotes

• "Financial advice is an industry, not a profession. This means there's a broad spectrum of qualifications and standards among advisors."
  — Pam Krueger (04:41)

• "Registered investment advisors are the only advisors legally bound to the fiduciary standard, ensuring they act in your best financial interest."
  — Pam Krueger (11:45)

• "At WealthRamp, we prioritize privacy and only recommend advisors after thorough vetting, protecting consumers from unsolicited contacts."
  — Pam Krueger (05:30)

Final Thoughts

This episode of The Long View serves as an invaluable resource for anyone seeking clarity in the daunting task of selecting a financial advisor. Pam Krueger's insights into the financial advisory ecosystem, combined with practical advice on vetting and engagement, empower listeners to make informed and confident decisions regarding their financial futures.