Kitces | Nerd's Eye View - Weekend Reading

Weekend Reading for Financial Planners (June 15-16)

nospam@example.com (Michael Kitces) — Fri, 14 Jun 2013 12:02:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a great article by Texas Tech professor Michael Finke, who tackles the challenging question of whether financial planning is more art or science, concluding that while it may not be all science, financial planners should probably be incorporating a lot more science than is typically done today.

Beyond that, there are a number of articles about technology for advisors this week, including a review by Bill Winterberg of using live chat systems on your website for communication with prospects and clients, reviews by Joel Bruckenstein of portfolio tool Chaikin Analytics for iPad and separately the cloud-based virtual desktop solution External IT being rolled out by Fidelity Institutional Wealth Services. There's also a review of some of the interesting tech companies that were seen earlier this Spring at the Finovate conference for financial services tech innovation, and a look at some of the recent data from the InvestmentNews 2013 Advisor Technology Study revealing that "innovator" firms that aggressively adopt technology are showing gains in everything from revenue and profits to valuations and easier succession planning.

From there, we have several articles specifically looking at some of the challenges that insurance companies are facing these days, from a new warning that some insurers many be less secure than they appear due to a "shadow insurance" loophole where they are reinsuring themselves with their own subsidies, to a subset of long-term care insurance companies that have been creating a lot of claims hassles with fine print and red tape, to the recent announcement by The Hartford that it will force a large swath of existing variable-annuity-with-income-rider policyowners to effectively renew what was supposed to be a lifetime guarantee or it will be cancelled.

We wrap up with three final articles: the first is from Angie Herbers and suggests that perhaps the "slow to hire and quick to fire" management practice is not really the best approach; the second is a good reminder that even as the world goes more digital, it is important not to forget the human beings at the other end of your business; and the last provides an important reminder that while the facts about why clients should work with us are important that it's ultimately the emotional connections we make that lead to real trust. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (June 15-16)"

Weekend Reading for Financial Planners (June 8-9)

nospam@example.com (Michael Kitces) — Fri, 07 Jun 2013 12:33:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with three big articles on industry trends: the first is a review of the comment letter submitted by the Financial Planning Coalition to the SEC, with a growing cadre of high-profile organizations supporting a fiduciary duty; the second is an interesting look at how CFP certification continues to grow in the large firm environment, even though some firms aren't entirely convinced the certification results in higher professional success; and the third looks at some of the trends with RIAs, including how margins are getting squeezed as the advisor environment gets more competitive. In a similar vein, there's also an article discussing some of Bob Veres' latest perspective about whether many advisors may actually be misjudging their competitive environment and undercharging clients.

From there, we have several technical articles this week, including a roundtable discussion about implementing a tactical asset allocation investment approach in your firm, a look from Moshe Milevsky at how in Chile the biggest annuity problem is that so many people choose to annuitize, a summary of some of the big changes coming to the healthcare system in 2014 as the major provisions of the Affordable Care Act kick in, and good overview of the health insurance exchanges in particular will work as they open up on October 1st, and an interesting warning from The Slott Report about clients who may be using their retirement plans to fund a business venture but are not reporting it properly on Form 5500 to the IRS.

We wrap up with two final articles: the first is a summary of a recent "Barron's top advisors" panel sharing what the keys to success were for them (most common theme: specialize); and the second is a good read from Jason Zweig of the Wall Street Journal about our shaken trust in the integrity of the financial system, and how important it is - due to our behavioral biases - that we continue to see ourselves living in a just world, which means it's still important for regulators to get more aggressive against wrongdoing, for Wall Street to show some contrition for its actions, or ideally both. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (June 8-9)"

Weekend Reading for Financial Planners (June 1-2)

nospam@example.com (Michael Kitces) — Fri, 31 May 2013 12:02:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with two industry studies: the first shows that an advisor's interpersonal skills and emotional intelligence dominate the traits of what makes the top advisors most successful (as opposed to quality information and advice, which is necessary but not sufficient for maximal success); and the second finds that as overall economic and wealth growth slows in the US, advisors will increasing be forced to compete with other advisors to win clients (or "steal" them), rather than just relying on the newly wealthy for new clientele.

There are several practice management and technology articles this week as well, including a good reminder about why it's so important to say "no" to the wrong prospects, the rising importance of getting involved with the Google+ social network as a way to grow your advisory business, some best practices tips on Twitter for advisors that are genuinely useful, a fascinating profile of what digital marketing for financial planning may look like in the future (and that a few advisors are already implementing today), and some data on how Millenials do and don't differ from older clientele and how advisors may (and may not) have to change to deal with their future clients.

We also have a pair of technical articles, including one looking at how the new health insurance rules will work for 2014 - open enrollment begins in October for millions of people! - and another on how the use of bypass and other estate planning trust strategies are changing as estate planning takes on a more income-tax-centric theme for the many clients who simply no longer face any kind of Federal estate tax liability.

Continuing the opening theme of emotional intelligence, we wrap up with three articles looking at the importance emotional intelligence, relationships, and the value we provide: the first is an interview with Doug Lennick, author of Moral Intelligence 2.0 and a consultant to advisors; the second is a meta analysis from the Harvard Business Review of all the research on emotional intelligence and what we can draw upon from it; and the last is a more general article about how just being in the information of dispensing expert information is no longer sufficient in today's world, and that everyone - including advisors - needs to get out of the business of trying to hoard increasingly commoditized information, and instead deliver real value through non-commodity service, customization, and making complex information relevant. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (June 1-2)"

Weekend Reading for Financial Planners (May 25-26)

nospam@example.com (Michael Kitces) — Fri, 24 May 2013 11:38:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a series of practice management articles, including a discussion of the emerging talent shortage for experienced advisors, how to choose a practice management coach to work with, and making a decision at the crossroads of business growth about whether to continue being an advisor or become a CEO of an advisory firm. There's also an article on the importance of watching the words that you use in your business, another about the positive impact that happiness can bring to your business and your success (the reality is that it's not success brings happiness, but that happiness brings success!), and a good reminder that even when you're building an online marketing effort there's a difference between platforms you can control and those you can't so be cautious that you don't turn yourself into a "digital sharecropper" with landlord risk.

From there, we look at a few technical planning articles, including a recent study finding that health insurance cost inflation may be slowing, a discussion of whether it makes sense to shift from current health care coverage to the coming new "Obamacare" health plans coming in the insurance exchanges this fall, a look from David Blanchett at how the factors of alpha, beta, cash flows, and delayed retirement impact retirement success, and the latest from Michael Finke on how there may be too much emphasis on the 4% rule and not enough on balancing out the longevity and "upside" risks that are also embedded into its assumptions.

We wrap up with three more introspective articles: the first looks at some recent research suggesting that seniors may not quite have the memory and cognitive decline once believed but that instead they're just better at prioritizing what to remember and what's irrelevant; the second examines our tendency to underinsure ourselves against high-impact low-probability events and that sometimes we need insurance to be "sold" to us to overcome our biases; and the last is an interesting piece about how forcing people to give a small "prosocial" bonus to others can actually be more effective for team-building and business success rather than just giving employees bonuses they can spend on themselves. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (May 25-26)"

Weekend Reading for Financial Planners (May 18-19)

nospam@example.com (Michael Kitces) — Fri, 17 May 2013 11:07:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with an announcement by the CFP Board of a new initiative to increase the number of women entering financial planning (currently only 23% of CFP certificants), a discussion from FPA's lobbying group of the current advocacy priorities in Washington DC for 2013, and a surprising article about industry trends showing that using virtual advisors isn't just about young people as many of the new startups in this space are reporting a significant number of Baby Boomers using their technology-driven advisory services.

From there, we look at a few industry-related articles, including one discussing how often the reason why advisors merger and acquisition deals fall through is not problems with culture and philosophy but just good old-fashioned dollars-and-cents, and a review by Bob Veres of the latest Mark Hurley white paper and the insights it provides not just about the advisory firm landscape but also some good tips for buyers and sellers about how to get a deal done. In addition, there's a pair of more technical articles, the first explaining how to help clients choose an appropriate Medigap supplemental policy, and the other looking at what an unwinding of Quantitative Easing by the Fed would really look like (hint, it will be a lot more gradual than the market volatility will imply when it begins).

In addition, there are several practice management articles, including one about how to ensure any photos and images you use on your website at legal to avoid a Copyright infringement lawsuit, another with some tips about how to "wow" a client (everyone says it's good to wow clients with great service, but what does that really mean!), and a good discussion about the importance of paying attention to your office environment and decor because the impression it leaves can impact your client's perspective on the entire experience.

We wrap up with three more introspective articles: the first poses a series of 5 questions that advisors should ask themselves and be able to answer to better focus where their business is going to succeed in the future; the second reflects upon the importance of telling your own personal story to help build a client's faith and trust in you; and the last is a fascinating look at the book "Give and Take" which finds that some people are givers, some are takers, and most are matchers, but it's the dynamic between the three of them that ultimately determines who succeeds in business. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (May 18-19)"

Weekend Reading for Financial Planners (May 11-12)

nospam@example.com (Michael Kitces) — Fri, 10 May 2013 12:05:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a surprising announcement that the CFP Board is considering a questionable proposal about whether to offer CE credit and go into direct competition with the CE sponsors it regulates (with advisors expressing strong concern about the conflict of interest that entails), along with two articles reporting on advisor trends in the industry, including a continued slide in the total number of advisors and wirehouses in particular, along with a contrasting view that the decline of wirehouses and the breakaway broker trend may actually be quite overstated.

From there, we look at a few behavioral-finance-related articles, including a controversial study suggesting that as many of 93% of financial advisors experienced symptoms of PTSD after the 2008 financial crisis and that the recent rise of tactical asset allocation may be a stress-driven response, a review of another recent study suggesting that the world of a fund manager is also a much more emotionally-driven experience than many might have thought, a discussion from the Journal of Financial Planning about the importance of focusing not just on a client's risk tolerance but also his/her risk perceptions (and the ways those perceptions can be distorted), and a review by Joel Bruckenstein of a new software package called Riskalyze that is aiming to provide a slightly newer way to assess client risk tolerance.

In addition, there are a few technology-related articles, including a reminder of the importance of considering not just software vendors and products and integrations in your technology decisions but also the staff that must implement it, some guidance from technology consultant Bill Winterberg about how to protect your firm and clients against so-called "phishing" attacks, a look at how some RIAs are successfully using social media to generate new clients, and a great article by Dan Moisand suggesting that the "rise of the machines" is not so much a threat against advisors as an opportunity for them to use technology for better efficiency.

We wrap up with an article reviewing recent research from Julie Littlechild, suggesting that just relying on client referrals by just making them satisfied and happy with your services isn't enough, given that surveys indicate 88% of clients are willing to provide a referral yet only 2% actually do provide one that successfully closes; instead, the real key is to create engaged clients who will refer you not because they're satisfied, but because you know how to solve the problems of one of their friends or family in need. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (May 11-12)"

Weekend Reading for Financial Planners (May 4-5)

nospam@example.com (Michael Kitces) — Fri, 03 May 2013 12:01:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a review of the latest Mark Hurley research suggesting that the overwhelming majority of advisory firms still have no economic value and are struggling for profitability. There's also a good review from Bob Veres of the rising range of online startup firms that are threatening advisors in various ways, a look at the recent SEC announcement that many RIA firms are failing to follow the Rule 206(4)-2 Custody Rules for client assets (in many cases, because the firms don't even realize what they're doing triggers the custody rule!), and a summary of recent research finding advisor use of social media - and consumer use of social media looking for advisors - continues to rise, with LinkedIn as the most active platform.

From there, we look at a few recent articles that have been critical of the SEC's request for information to do a cost-benefit analysis regarding a uniform fiduciary standard, finding that the way the SEC is asking the questions may already be shaping the outcome in a manner that either undermines the intended purpose of the rule, or in the view of the Institute for the Fiduciary Standard outright narrows the potential scope of fiduciary to the point where it no longer provides effective consumer protection. There's also an interesting alternative proposal from Don Trone that a better way to bring principles-based fiduciary to broker-dealers is to craft a series of "fiduciary safe harbor" guidelines that would allow broker-dealers to comfortably apply a fiduciary standard and know how to oversee it, without creating a maze of burdensome rules.

In addition, there's an article from Steve Utkus of the Vanguard Center for Retirement Research that criticizes the recent and controversial PBS Frontline special "The Retirement Gamble" (despite the special's favorable positioning of Vanguard and low-cost indexing), and a look from John Mauldin about how the progression to a "cashless society" (where we all do business using credit cards, debit cards, and smartphones) may be further away than we think, due to the rise in cash-based economic activity due to the incentives created by regulation, taxation, and social programs.

We wrap up with three very interesting articles: the first is a review of the recent "Technology Tools for Today's High-Margin Practice" book by Bruckenstein and Drucker; the second looks at a behavioral bias called "motivated reasoning" - where we are more analytical and critical of things that would challenge our existing views and beliefs - that can be a challenge for both clients and advisors themselves; and the last looks at how the shift to 401(k) and other defined contribution trends is analogous to a broader societal shift towards a greater demand on self-motivation and self-reliance, which allows some to flourish but is creating significant challenges for many others, as a world with more choices and fewer limits also has fewer guarantees and safety nets... and perhaps more opportunities for advisors to help people navigate effectively. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (May 4-5)"

Weekend Reading for Financial Planners (Apr 27-28)

nospam@example.com (Michael Kitces) — Fri, 26 Apr 2013 10:15:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with some breaking news about the announcement by Senator Baucus that he will not run for re-election in 2014 - which may set the stage for compromise on bipartisan tax legislation - and a look at the latest in the recent debates about the flaws in the Reinhart and Rogoff research on high-debt countries, which are now suggesting that the criticism may have overstated the issue and that the fundamental concerns of growth in high-debt countries remain.

From there, we look at a few articles on working with younger "next generation" planners, including a discussion of the FPA's rising focus on young planners, some guidance from Deena Katz on how to better bridge the baby boomer vs Gen X/Y gap (which she suggests requires some improvements from both sides of the chasm), some tips on how to recruit and hiring Generation Y advisors and get them to stay, and some advice from Angie Herbers on when to consider not just hiring young "professional" staff (meaning young financial planners) but also "non-professional" staff (meaning your high quality operations and administrative staff) who can also have a critical impact on the success of your business.

In addition, there are two articles regarding social media, including one that looks at a series of recent research studies showing the rising adoption of social media by both advisors and their prospective and current clients, and another that examines the rising conflict between regulatory efforts to oversee social media in financial services and states enacting laws to protect personal social media accounts from employers. There's also an article by Mark Tibergien cautioning advisors not to just be "Fiduciaries In Name Only" (or "FINO" for short!), but to ensure that the entire practice is really being run in a proper manner.

We wrap up with three very interesting articles: the first is from retirement researcher Moshe Milevsky about whether we should consider bringing back an old annuity-like pooled investment approach called a tontine; the second looks at how to generate better referrals by getting your clients not to tell their friends about you and your benefits but a story about the kinds of problems you help people solve; and the last provides a good reminder that while all the technical knowledge we apply for our clients is valuable, from tax strategies to investment management, that for some clients our key value proposition may not be that we do it "better" than the client but simply that we do it "for" them and eliminate their time, hassle, and stress, so they can better enjoy their lives. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Apr 27-28)"

Weekend Reading for Financial Planners (Apr 20-21)

nospam@example.com (Michael Kitces) — Fri, 19 Apr 2013 12:09:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with some breaking news about new legislation from Representative Maxine Waters that would authorize the SEC to collect user fees to increase oversight of RIAs (although it's not clear the legislation will gain momentum, it's viewed by many as a favorable alternative to FINRA oversight of RIAs). There's also a call from the Consumer Financial Protection Bureau for a fresh crackdown on "senior designations" and a good in-depth look at the potential fiduciary rule coming out of the Department of Labor in the next few months.

From there, we look at a few articles on notable industry trends, including a review of recent Aite Group research suggesting that there may be more unhappy advisors in RIAs than working in wirehouses, a look at how CFP certificants are geographically distributed around the country, and a review of InStream Solutions financial planning software and its numerous innovations in how advisors can use its software to enhance their outcomes with clients.

In addition, there are a couple of research and technical articles this week, including a good summary of this week's Reinhart and Rogoff research controversy and exactly what the purported flaws were in the original study, a discussion of whether dividend investing is really just a value tilt in disguise (and that dividends might actually be a detractor from performance after adjusting for value!), and a look at a recent research brief from the Center for Retirement Research which finds that "nudges" like automatic enrollment programs may actually be a more effective government policy to encourage retirement savings than just providing a subsidy in the form of tax deductions.

We wrap up with two practice management articles - one with a list of good tips for using LinkedIn, and the other about how to introduce new technology tools to your clients - and close out with an article suggesting that advisors may be talking to clients with more jargon than they realize (and what to do about it), and another looking at financial planning trends in the future and suggesting that while expert knowledge is important, the best financial planners will be differentiated by their ability to use "left-brain" abilities to connect with clients emotionally to really leverage their right-brain knowledge. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Apr 20-21)"

Weekend Reading for Financial Planners (Apr 13-14)

nospam@example.com (Michael Kitces) — Fri, 12 Apr 2013 12:05:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with discussion of two noteworthy news events this week, including an announcement by BrightScope that later this year it will begin to include details of advisors' fees based on their Form ADV filings to help consumers evaluate cost, and a release of new Cerulli research that finds tactical asset allocation is about to become the majority strategy for advisors.

From there, we look at a few articles on notable industry trends, including a recap of the top industry trends from Chip Roame at the event spring Tiburon CEO Summit, a discussion of the latest iteration of the Merrill Lynch training program (now salaried for 43 months, with CFP certification required!), and an overview of up-and-coming RIA custodian TradePMR that may be about to take integrated and mobile investment adviser technology to a whole new level.

In addition, there are a couple of research and technical articles this week, including a good discussion of the research on what does (and doesn't) work in trying to choose a good active investment manager, a Journal of Financial Planning article that effectively summarizes the long list of disparities between the theory and practice of portfolio construction, some tips on how to handle college financial aid offers, and a look at the recent White House announcement to delay parts of the Small Business Health Options Program for small business health insurance exchanges in 2014 and how this may accelerate the trend of separating health insurance from employment.

We wrap up with three very interesting articles: the first looks at the research on where money does and doesn't impact motivation and (job) satisfaction; the second explores from behavioral finance research that suggests telling clients they need to change behavior to avoid the "retirement crisis" the nation faces may actually be a harmful approach; and the last is a creative look about how we can all manage and build our personal assets, regardless of whether we're a business owner or an employee, in financial services or otherwise! Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Apr 13-14)"

Weekend Reading for Financial Planners (Apr 6-7)

nospam@example.com (Michael Kitces) — Fri, 05 Apr 2013 12:02:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with an announcement of the CFP Board's new "Financial Planning Competency Handbook" which is intended to become the "Merck manual of financial planning," an announcement from the SEC that companies will now be allowed to release and disseminate key news and information through social media rather than (or in addition to) traditional media channels, and a surprising recent study that found advisory firms run by Gen X and Gen Y practitioners may already be generating more profits than the practices of baby boomers due in large part to their better use of technology.

From there, we have a few more practice management articles, including a discussion of how to break out of the "PR slump" if you're using blogging and social media but not getting the results you want, a look at how to rethink employee compensation to recognize that while it's important not to underpay employees it often doesn't help to overpay them either, and a review of the "Hidden Levers" software program that allows advisors to stress test current and prospective client portfolios through a variety of macroeconomic scenarios.

In addition, there are a couple of research and technical articles this week, including a study that finds whether clients think short-term or long-term in moments of financial stress may actually be related to their socioeconomic status as children, a look at whether projecting retirement accumulations in the amount of future income it can buy may be more effective than just showing a future account balance (it helps only modestly, but it helps), and a discussion of the recent new rules allowing intra-plan Roth 401(k) conversions and when they do (and don't) make sense.

We wrap up with three very interesting articles: the first is looks at how we seem mired in complexity, and what it takes to truly simplify the products or services we provide clients (even though simplicity is actually much harder to deliver than complexity!); the second is an intriguing interview with Michael Mauboussin on his book "The Success Equation" with some innovative thoughts about the interrelationship between luck and skill; and the last is an amusing - or perhaps not - April Fool's send-up by fiduciary expert Ron Rhoades about a hypothetical SEC temporary rule that would apply a uniform and very-watered-down fiduciary standard for RIAs and brokers, which is sad not just for the fiduciary outcome it portrays but the fact that several journalists and professors thought the announcement was actually true! Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Apr 6-7)"

Weekend Reading for Financial Planners (Mar 30-31)

nospam@example.com (Michael Kitces) — Fri, 29 Mar 2013 12:02:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with an interesting discussion noting that the trend from regulators now appears to be allowing for and even encouraging the use of social media in financial services (albeit while still expecting firms to maintain proper procedures to oversee the activity), and a harsh look at whether our real problem in the financial services industry is not just the general lack of trust but the fact that the entire financial sector has bloated to the size that it has... and that even though the bloat stems largely from Wall Street, it's those very firms that have such an integral role in rewriting the new rules for the future.

From there, we have a few industry and practice management articles, including a discussion of how marketing is shifting from just trying to convert a percentage of prospects into meetings and clients and instead towards engaging all prospects on an ongoing basis until they become clients, a look at Wealthfront and the rise of online investment providers, and a discussion of how you can break out of the rut of boring review meetings (which long-standing clients often resist) by structuring your reviews to have themes around broad financial planning topic areas that can be systematically revisited over time (yet provide more variety than just reviewing investments or asking if anything has changed).

In addition, there are a couple of technical articles this week, including a warning that health insurance premiums may be set to rise significantly with the new coverage laws taking effect in 2014 (especially for individuals getting coverage directly and some small businesses), a discussion of the unique planning challenges for families with special needs dependents (and the potential for advisors to create niche practices to serve them), a look at the so-called "dividend illusion" and that investors may be misunderstanding how dividends work if they think it's a strategy to only spend income and not principal, and the latest Mauldin article dissecting the ongoing debacle in Cyprus.

We wrap up with three somewhat more offbeat articles: the first is looks at how color - the your clothing to the markers you use to illustrate key points - may influence your clients; the second is an excerpt of the latest Heath brothers book "Decisive" about how we can make better decisions; and the last is a somewhat controversial discussion from J.D. Roth, founder of the popular Get Rich Slowly blog, who observes that financial literacy alone just isn't enough, primarily because most financial problems aren't just about needing more information, but also about (fixing) our (dysfunctional) behaviors. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Mar 30-31)"

Weekend Reading for Financial Planners (Mar 23-24) - Practice Management Edition!

nospam@example.com (Michael Kitces) — Fri, 22 Mar 2013 11:01:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue is focuses on practice and career management issues, and starts off with some notable regulatory news, including a discussion of whether the landscape is shifting for potential adviser oversight as Congresswoman Maxine Waters may re-introduce SEC user fee legislation in the coming days that could put FINRA on the defensive, and some updated guidance from the SEC on the use of social media that should make it easier for advisors under an RIA to use social media.

From there, we have a long list of practice management articles, including a review of a recent Schwab survey that shows the primary desire of young advisors is to work with clients (sooner rather than later), a discussion by Angie Herbers about how to restructure your firm's org chart to facilitate associate advisors getting more face time with clients, some insights from Philip Palaveev about the importance of balancing both practice management research and good old trial-and-error to improve your firm, a look at some of the challenges to consider for brokers who wish to break away and transition to independence, and how to handle prospective situations where friends and family want a discount.

There are also two technology articles, including some guidance from Bill Winterberg about how to get a better return on investing in your website by going a step beyond just making it look prettier and being more mobile-friendly, and a discussion by consultant Craig Iskowitz about how client portals are changing and a look at the JunxureCRM ClientView platform in particular.

We wrap up with three articles: the first is from the Harvard Business Review blog, providing some guidance and advice about why you should not try too hard to fast-track your career; the second by Philip Palaveev suggesting that it's time to stop talking about "practice management" and start looking at "business management" instead; and the last is a nice list of productivity and anti-procrastination tips and techniques from Psychology Today - including a few common ideas, but also a few you may not have seen before.

Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Mar 23-24) - Practice Management Edition!"

Weekend Reading for Financial Planners (Mar 16-17)

nospam@example.com (Michael Kitces) — Fri, 15 Mar 2013 12:01:00 -0500

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a recent survey from the Financial Planning Coalition that advocates for greater [fiduciary] regulation of advisers to protect consumers, and a review of the Senate confirmation hearing for prospective SEC chairwoman Mary Jo White, who pledged to act quickly on the proposed uniform fiduicary standard and increased oversight of investment advisers.

From there, we have a few practice management articles, including a look at how mega-RIA RegentAtlantic built a $2.4 billion AUM practice by creating a series of niche specialist planners under a single umbrella, an evaluation of all the ways advisors add value to clients in portfolios beyond just investment selection (e.g., helping clients stay the course, asset location, systematic rebalancing, etc.), an overview of the biggest tech trends coming out of the recent Technology Tools for Today conference, how to craft a good content marketing strategy, and a good list of ways in which advisors end out "wasting" their time on social media due to poor execution of the marketing strategy.

In additon, there are a couple of technical articles this week, including a look at how even index funds aren't really truly passive but that the essence of being passive can still be captured if the goal is to simply be the market and not beat the market, and an overview of some of the problems that arise when clients misunderstand what cash value life insurance is and how the cash value really works.

We wrap up with three articles: the first is by Bob Veres and looks at how financial planning may change in the coming decade; the second is a series of tips from Bill Bachrach about how to improve work habits in your practice to be more successful, and the last is an intriguing overview of some of the recent research about the link between money and happiness, which is much more nuanced than the traditional saying "money can't buy happiness" would imply. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Mar 16-17)"

Weekend Reading for Financial Planners (Mar 9-10)

nospam@example.com (Michael Kitces) — Fri, 08 Mar 2013 12:15:00 -0600

Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a look at how financial planning may be different by 2023 (and the trends driving those changes), from the rise of Gen X and Gen Y to the impact of technology as computing power continues to grow exponentially.

From there, we have a few practice management articles, including a look at how LPL's NestWise financial planning offering for the middle market is beginning to gain momentum, a review of useful technology tools and apps for financial planners from a panel at the Technology Tools for Today (T3) conference, and a review of the recent 2013 Investment News Advisor Technology Survey.

In additon, there are a couple of more technical financial planning articles this week, including a preview of how health insurance will work for clients beginning in 2014, how estate planning trust strategies are shifting given the permanence of higher estate tax exemptions and portability, some guidance about how to debunk questionable investment sales pitches that may come to your clients, and an overview of the increasingly popular risk parity funds.

There are also a pair of articles tying to psychology and behavioral research for planners: the first finds that perhaps the perceived differences in risk tolerance between men and women are actually just a myth (or at least, can be explained by their personal and financial circumstances, not any biological difference in risk aversion); and the second article provides some guidance about how we can help clients de-stress their financial decision-making process.

We wrap up with two much lighter articles: the first is by Vivek Wadhwa and explains how, despite having no journalism degree, never taking writing classes, and nearly failing English in grade school, he became such a prolific business writer (and you can, too!); and the last article highlights 10 things that really amazing employees do, which can either be a suggestion for how to better succeed if you are an employee, or what to look for and better reward if you are a boss/owner/employer. Enjoy the reading!

Continue reading "Weekend Reading for Financial Planners (Mar 9-10)"