Stay Wealthy San Diego Podcast, “Building a Business and Creating Wealth that Lasts” with Dale Yahnke

By on August 16, 2017
Categories: D&Y UPDATES

Dale Yahnke sat down with Taylor Schulte (from Stay Wealthy San Diego) to discuss Dowling & Yahnke’s pioneering fiduciary business model, its founding, how it has benefited clients, and exploring the firm’s growth and success over the past 26 years.  You can listen to the full podcast, as well as read an excerpt, below.


TS: What were some of the major conflicts that you noticed in working for that law firm and representing these wire houses, these big brokerage firms?

DY: Well, I think people like to criticize brokers.  I probably was the same way.  I think a lot of the people in the industry would hire people that are really good at sales, and I think I resented the fact that this is a technical industry and you have a huge responsibility to take people’s life savings.  What the firms [wire houses] really did, in a really simple way, was create products.  And it made a lot of sense.  They just hired really good sales people to sell those products.  They weren’t necessarily looking for the best credentialed people. They were looking for the best sales people.

So, what I got out of it is that I shouldn’t really blame the brokers for doing what they were incented to do.  You had to blame the wire houses for creating incentives that weren’t necessarily in the client’s best interest.  When you saw that kind of obvious conflict of interest, the broker could say, “Well, it didn’t affect me.”  But, if you had different compensation systems where one product might generate an 8% commission at the time, or one that might generate a 1% commission, you can always rationalize why the 8% one was better for the client.  It was just a huge conflict [of interest].  People couldn’t act in an objective way to give advice under those circumstances.

People give me credit for being an entrepreneur, but it was pretty obvious, in my mind, that there was a just better, more ethical, honorable model than what was out there.  It was an opportunity that was big enough to drive a truck through.  So, I don’t think I was any special entrepreneur.  It was just pretty obvious there was a better model compared to where people are kind of being forced to be fiduciaries now with this Department of Labor [ruling].  I thought it was a competitive advantage 26 years ago to set a firm up as a fiduciary.  If I couldn’t explain that to clients and why that was better, I wasn’t very smart.


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