Subject: SEC Review of Rule 12b-1

July 19, 2007

I am writing to express my concerns about the SEC's ongoing review of Rule 12b-1. Middle class Americans need the continuing service, guidance and support that are provided by independent financial advisors to achieve their stated investment goals. 12b-1 fees provide a tax efficient means to support the continuing service which these clients require for successful investing. The benefits of 12b-1 fees are numerous and include:

.My office is predominating in a blue collar area. Most larger employers have closed their doors. Most clients of mine, only have $25,000 -$50,000 in assets. As part of my routine meeting with first time clients, their first question to me is, "How do you get paid?" Since these individuals are not high wealth individuals, mutuals funds seems to make since for finding financial independence over the long haul without needing thousands of dollars to get started. When I explain commissions and up front "A" shares, many have responded, "If you only get paid up front on this money, then you will never look at my account again." Explaining the 12b-1 fee as part of the expense of the mutual funds, makes them feel much, much better. Their' comment is, The more money I make, the more money you make, so you really would look at my account. and try to do the best for me." This is a very common response. Take away these fees and 'how would I be compensated for my time, me etings,reviewing accounts, etc.? Not many financial advisors bother with the "little guy," I consider myself a little guy, probably an over achiever who always saved money, we seem to always be helping out the millionaire who can afford to pay an annual fee to their advisor for brokerage accounts, buying and selling securities, etc.. During the early 2000's recession, I picked up many fee based accounts from investors who felt they were paying their advisors too much in fees while their account continuly lost money. Fee based isn't what it's cracked up to be. Only the advisor continues to make money.

. We all know the common mistakes investors make; buying high and selling low, chasing past performance and harboring unrealistic expectations. 12b-1 fees provide financial advisors with compensation to manage their client's expectations and protect them from falling into this common investor traps.

Also I will be looking to down size my staff if 12b-1 fees are taken away, as I will no longer be able to afford the size staff I now have. This certainly could be a snowball affect.

In conclusion, while it is reasonable to review the investor benefits of 12b-1 fees, it is obvious that the repeal of 12b-1 has the potential to cause great harm to thousands of individual investors who need the support and service of a trained financial advisor. As a result, I urge the SEC to allow Rule 12b-1 to continue to support my efforts to provide needed financial services to middle class American investors pursuing the financial goals.


Cheryl Janik