A Form CRS may run no more than two pages on paper (four for a combined broker and adviser summary), and it must print the question "If I give you $10,000 to invest, how much will go to fees and costs, and how much will be invested for me?" (SEC, Form CRS Instructions, checked October 14, 2026).
What the two documents are
Two short documents tell you more about an advisor than any sales meeting. Both are free, both are filed with regulators, and most people never read them.
- Form CRS (client relationship summary): brokers and registered investment advisers must give it to retail investors (Investor.gov/CRS, checked October 14, 2026). It is short by rule: no more than two pages on paper, or four for a firm offering both brokerage and advisory services in one summary (SEC, Form CRS Instructions, checked October 14, 2026). You should receive it when the relationship starts or when your account changes, such as an IRA rollover (Investor.gov, Form CRS, checked October 14, 2026).
- Form ADV Part 2: the adviser's brochure (Part 2A) and brochure supplement on the individual (Part 2B). The brochure is "the primary disclosure document for investment advisers" and covers business practices, fees, conflicts of interest and disciplinary information (Investor.gov, Form ADV, checked October 14, 2026).
Form CRS has been required since June 30, 2020 (FINRA, Regulation Best Interest, checked October 14, 2026). An adviser must give you the brochure before or at the time you sign an advisory agreement, and each year deliver an updated brochure or a summary of material changes within 120 days of its fiscal year end (SEC, Form ADV Part 2 instructions, checked October 14, 2026).
How to find them for free
Search a firm or a person at Investor.gov/CRS. For advisers, the SEC's Investment Adviser Public Disclosure (IAPD) site holds Form ADV. For brokers, FINRA's BrokerCheck shows registration and disclosure history. Form ADV parts are public on IAPD (Investor.gov, Form ADV).
An insurance agent who sells only insurance products has no Form CRS or Form ADV, because only brokers and advisers are required to file them (Investor.gov/CRS). For agents, check your state insurance department's license lookup and the NAIC Consumer Insurance Search for complaints against insurers.
Reading Form CRS, section by section
Every relationship summary uses the same headings in the same order, so firms can be compared (Investor.gov/CRS). The table below lists each section and the questions the SEC requires firms to print for you. Three sections deserve slow reading:
- "What fees will I pay?" Firms must describe their principal fees and the conflicts those fees create (Form CRS Instructions, Item 3.A).
- Standard of conduct. The summary must say, in required wording, that the firm must act in your best interest and that "the way we make money creates some conflicts with your interests" (Item 3.B).
- "How do your financial professionals make money?" Firms must say whether pay depends on assets serviced, time, the product sold, or product commissions (Item 3.C).
The disciplinary section must answer "Yes" or "No" (Item 4). A "Yes" can reflect anyone at a large firm, so look up your own representative by name.
Reading the Form ADV Part 2 brochure: the items that matter
The brochure is longer, written in plain English by rule. These items matter most for a retiree (SEC, Form ADV Part 2 instructions):
- Item 5, Fees and Compensation: the fee schedule, whether it is negotiable, how it is billed, other costs, and whether staff accept commissions. If commissions are more than 50% of advisory-client revenue, the firm must say so (Item 5.E).
- Item 9, Disciplinary Information: material legal or disciplinary events, generally for ten years after the event.
- Item 10, Other Financial Industry Activities: whether the firm or its managers are also registered with a broker-dealer, and related insurance or other affiliations.
- Item 12, Brokerage Practices and Item 14, Client Referrals and Other Compensation: soft-dollar benefits, payments from others, and sales awards or prizes.
- Item 15, Custody: if the adviser has custody, a qualified custodian sends your statements, and you are urged to compare them with the adviser's reports.
- Item 18, Financial Information: a firm requiring prepayment of more than $1,200 in fees six months or more in advance must include an audited balance sheet.
Then read Part 2B on your own representative: education, business experience, discipline, other business activities and additional compensation, such as sales-based bonuses (Part 2B, Items 2 to 5).
Compare the documents with the sales meeting
Read the two documents next to what you were told. Watch for gaps: "fee-only" in the meeting but commissions in Item 5; "I'm a fiduciary" when the firm is registered only as a broker; an insurance affiliation in Item 10 that never came up. For the duties behind these documents see Fiduciary, decoded and best interest vs fiduciary; for pay models see fee-only vs fee-based.
The Form CRS sections and the questions the SEC requires
The sections of every Form CRS and the conversation starters the SEC requires, quoted from the instructions (SEC, Form CRS Instructions, checked October 14, 2026). A broker-only firm or adviser-only firm prints a one-service version of the first Item 2 question.
| Section and required heading | Required conversation starter (exact wording) |
|---|---|
| Item 1. Introduction (dated, with registration type) | None required. Must point you to Investor.gov/CRS for free research tools. |
| Item 2. "What investment services and advice can you provide me?" | "Given my financial situation, should I choose an investment advisory service? Should I choose a brokerage service? Should I choose both types of services? Why or why not?" (dual registrant wording) "How will you choose investments to recommend to me?" "What is your relevant experience, including your licenses, education and other qualifications? What do these qualifications mean?" |
| Item 3.A. "What fees will I pay?" | "Help me understand how these fees and costs might affect my investments. If I give you $10,000 to invest, how much will go to fees and costs, and how much will be invested for me?" |
| Item 3.B. "What are your legal obligations to me...? How else does your firm make money and what conflicts of interest do you have?" | "How might your conflicts of interest affect me, and how will you address them?" |
| Item 3.C. "How do your financial professionals make money?" | None required. Must describe pay based on assets, time, product sold or commissions. |
| Item 4. "Do you or your financial professionals have legal or disciplinary history?" | "As a financial professional, do you have any disciplinary history? For what type of conduct?" |
| Item 5. Additional Information | "Who is my primary contact person? Is he or she a representative of an investment adviser or a broker-dealer? Who can I talk to if I have concerns about how this person is treating me?" |
A plain example with numbers: if the fee answer to the $10,000 question is $100 a year, that is 1%. On a hypothetical $800,000 rollover, the same rate is $8,000 a year ($800,000 × 0.01). Ask for the answer in dollars for your own balance.
Red flags
- You were not given a Form CRS before or at the start of the relationship, or before a rollover.
- The fee section gives percentages but the advisor will not answer the $10,000 question in dollars.
- The disciplinary section says "Yes" and the representative will not explain what it refers to.
- Item 5 of the brochure says staff accept commissions, while the salesperson describes the firm as fee-only.
- Commissions are disclosed as the firm's primary compensation in the brochure.
- Item 10 shows an insurance agency or broker-dealer affiliation that was never mentioned.
- Item 14 or Part 2B Item 5 describes sales awards, prizes or sales-based bonuses.
- The adviser has custody but you do not receive statements directly from a qualified custodian.
- The firm asks for more than $1,200 in fees six months or more in advance.
- The person's name does not appear on BrokerCheck or IAPD, or the registration shown differs from the title on the business card.
Questions to ask before you sign
- Can I have your Form CRS, Form ADV Part 2A brochure and your Part 2B supplement before we meet again?
- If I give you $10,000 to invest, how much will go to fees and costs, and how much will be invested for me?
- How might your conflicts of interest affect me, and how will you address them?
- As a financial professional, do you have any disciplinary history? For what type of conduct?
- Who is my primary contact person, and is he or she an adviser representative or a broker representative?
- Who can I talk to if I have concerns about how you are treating me?
- Which items in your brochure changed in the last year?
- Do you or your firm receive any payments from product sponsors, insurers or other third parties?
- Who holds custody of my money, and will statements come to me directly from that custodian?
- Is your fee negotiable, and where is the full fee schedule in your brochure?
Read This Before You Sign
A one-page checklist: the red flags in annuity and indexed universal life (IUL) sales, and the questions to ask before you sign anything. Which pages of Form CRS and Form ADV to read first, and the questions to ask about what they say. We’ll email it to you.
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Sources
- SEC: Form CRS instructions (checked October 14, 2026)
- Investor.gov: Investor.gov/CRS (checked October 14, 2026)
- Investor.gov: Form CRS glossary (checked October 14, 2026)
- Investor.gov: Form ADV glossary (checked October 14, 2026)
- SEC: Form ADV Part 2 instructions (checked October 14, 2026)
- SEC: Investment Adviser Public Disclosure (checked October 14, 2026)
- FINRA: BrokerCheck (checked October 14, 2026)
- FINRA: Regulation Best Interest and Form CRS key topic page (checked October 14, 2026)
- NAIC: Consumer Insurance Search (checked October 14, 2026)
The Retirement Literacy Foundation is a 501(c)(3) public charity. This page is general education, not tax, legal or investment advice. Nothing is sold here, no product is recommended, and RLF accepts no funding from financial companies. Rules and figures change; each one above shows its source and date. Check anything you plan to act on with your state insurance department or a qualified professional who is not paid on the product.