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Weekend Reading For Financial Planners (February 14–15)

February 13, 2026 02:00 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" - this week's edition kicks off with the news that Charles Schwab's latest RIA compensation report finds that while base salaries remain the largest component of advisor compensation, firms that offer incentive pay have seen more revenue and client growth in recent years than those that don't (notably, these firms also are more likely to have strategic plans and a defined client value proposition, which could play a role in these results as well). Beyond compensation, the survey also found that top-performing firms were more likely to offer an established employee value proposition (including features such as a compelling work setting, emphasis on teamwork, recognition, and connections, and a defined mission statement, culture, and values), suggesting that attracting and retaining high-quality talent (and the follow-on effects for client growth) could mean looking beyond headline salary figures to the broader monetary and non-monetary compensation firms can provide their employees as well.

Also in industry news this week:

A recent SEC settlement shines a light on potential regulatory violations stemming from RIAs' use of "hedge clauses" in their advisory agreements
A survey looking at advisory firm career development finds that internal training and compensation for certifications and continuing education are the most commonly available features of such programs, with a number of advisors seeking less-common offerings, including external coaching

From there, we have several articles on tax planning:

Four red flags that might appear in a prospect's or client's tax return and how advisors can use them to identify future tax-savings opportunities
How financial advisors can help high-income clients duck the "SALT torpedo" that can result in a significantly higher marginal tax rate
The pros and cons of three timing strategies for taking Required Minimum Distributions (RMDs) and how advisors can play a valuable role in ensuring they are taken in a timely and accurate manner

We also have a number of articles on retirement planning:

A recent study finds that annual healthcare costs could be expected to increase at an average annual rate of 5.8%, well above the overall inflation rate
How the growing costs of the Medicare program could lead to significantly higher IRMAA surcharges in the years ahead (increasing the value of income management in retirement)
While lump-sum figures of total healthcare spending in retirement might be scary, in reality these costs often represent a more manageable burden on an annual basis (though still a major line item on many retirees' budgets)

We wrap up with three final articles, all about time management:

Why "time fragmentation" can prevent advisors from focusing on strategic initiatives that could boost long-term growth and how time blocking could be an effective solution
How "hurry sickness" can lead to negative physical and mental effects for busy professionals, and how a task organization system that moves items off an individual's plate can prevent this phenomenon from occurring
Why procrastination isn't necessarily a matter of (a lack of) mental will, but rather a reflection of ambivalence between two choices that each have their own upsides

Enjoy the 'light' reading!

Box Spreads Explained: A (Lower-Interest) Borrowing Alternative To Margin Loans And SBLOCs

February 11, 2026 07:03 am 0 Comments CATEGORY: General Planning

Debt is an important tool in the financial toolbox, and can be very helpful when used in the right way. People often view 'good' debt in terms of loans that are subsidized and/or tax-deductible in some way, such as mortgages and Federal student loans. But some forms of debt can be useful for other planning purposes, such as when an individual needs a bridge loan to put a down payment on a new house while waiting for their old house to be sold, or if they have a large expense coming up like a home renovation or a new vehicle purchase and they want to avoid liquidating investment assets (and incurring capital gains taxes) to pay for it.

There are various types of loans available for these shorter-term borrowing needs, including Home Equity Lines of Credit (HELOCs) backed by the equity in one's home, and margin loans or Securities-Backed Lines of Credit (SBLOCs) secured by the value of the borrower's portfolio assets. While these loans offer some financial flexibility and have lower interest rates than other kinds of personal debt, like credit cards, they still tend to carry higher interest rates than the 'best' types of loans (e.g., mortgages and student loans). Moreover, interest paid on HELOCs, margin loans, and SBLOCs generally isn't tax-deductible, unless they're used for a small subset of purposes (e.g., a HELOC used for home renovations or a margin loan used to buy income-generating investment property).

In recent years, however, a new form of 'synthetic' lending has emerged as a potential alternative to margin loans or SBLOCs for short- and medium-term borrowing: The "box spread". At a high level, the box spread is an options strategy involving four different options contracts (selling a call, buying a put, buying a call, and selling a put), all with the same expiration date. The options contracts are structured so that, regardless of market movements, the 'borrower' is guaranteed to receive a net premium payment at the start of the period and to repay a fixed amount on the options' expiration date. Which makes the box spread effectively a zero-coupon loan where the 'principal', plus interest, is paid back at the end of the loan term. And owing to the fundamental math behind options pricing, the effective 'interest' rate paid on box spread loans tends to be only slightly higher than the interest on Treasury bills, which is far lower than the borrower would likely pay on a margin loan or SBLOC!

The tax treatment of box spread loans creates yet another advantage. Since a box spread effectively creates a net loss on a combination of options contracts, the 'interest' paid is tax-deductible as a capital loss. And because most box spreads qualify as 'non-equity options' under IRC Sec. 1256, a portion of the loan interest is usually deductible in each year that the box spread is in effect – even though the interest isn't actually paid until the options expire and the 'loan' is paid back. All of which means that in comparison to margin loans and SBLOCs, box spread loans have both a lower interest rate, and that interest is tax deductible (although box spread interest is only deductible against capital gains income, which is less of a benefit than being able to deduct against ordinary income – but it's still better than not being able to deduct the interest at all!).

Although options strategies are often risky, the offsetting 'legs' of a box spread mean that there's no inherent market risk from using a box spread – and because the Options Clearing Corporation (OCC) guarantees options contracts, there's very little risk that a counterparty will be unable to pay their portion of the options contract either. The main risk is that the amount to be repaid generally counts against the borrower's margin requirements in their brokerage account. Which means the borrower can borrow up to a certain percentage of the assets in their taxable account (typically 50%), and a severe market drop could trigger a margin call requiring the borrower to add more funds to their account and/or close out the box spread early.

The key point is that while box spreads won't necessarily replace advantageous debt like mortgages and student loans, their combination of low interest rates and tax deductibility can make them a viable alternative to HELOCs, margin loans, and SBLOCs in the shorter-term borrowing sphere. And with new providers starting to pop up that can handle the operational side of box spread borrowing and make it so that advisors don't need to manually construct box spread trades for their clients, they could become much more common in the years ahead as an option to meet clients' borrowing needs.Read More...

Making The Decision To Add A Partner (After Leaving A Partnership Yourself) While Approaching $500M AUM: #FASuccess Ep 476 With Kathy Longo

February 10, 2026 07:05 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Kathy Longo Podcast Preview Image FAS copy

Welcome everyone! Welcome to the 476th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Kathy Longo. Kathy is the founder of Flourish Wealth Management, an RIA based in Edina, Minnesota, that oversees $455 million in assets under management for 163 client households.

What's unique about Kathy, though, is how she decided to add a partner despite leaving a previous partnership within a larger RIA to start a business that she could drive individually.

In this episode, we talk in-depth about how Kathy decided to offer an ownership stake to an advisor on her team to both get the ball rolling on a succession plan that will allow her firm to remain independent and to reward the advisor for his contributions and commitment to the business, why Kathy chose to issue a self-financed loan for her new partner’s buy-in for both tax planning purposes and to better manage debt she had taken on to finance an acquisition, and how Kathy benefited from using an external valuation service not only by receiving an accurate valuation for the firm for her new partner’s buy-in, but also by learning about the key drivers that would propel her firm’s value going forward.

We also talk about how Kathy has found success in the latest stage of her growth journey in part by working with external partners to better define her firm’s culture and values (and align them with its model and career paths), how Kathy has used a recruiting firm and different assessment tools to improve her hiring process and identify candidates that are more likely to fit her firm’s culture, and how Kathy has created better alignment throughout her firm as her team has grown by instituting the Entrepreneurial Operating System (with the support of an external implementer).

And be certain to listen to the end, where Kathy shares how she boosted her firm’s growth through an acquisition (and how she made the transition more manageable by acquiring the clients in tranches rather than all at once), how Kathy has found significant value from working with coaches who can serve as dedicated sources of advice and feedback on both strategic business planning and her own leadership skills, and how Kathy has successfully managed running a firm where her husband is a key employee (including by setting appropriate work/life boundaries).

So, whether you’re interested in learning about starting down the path of an internal succession by adding a partner, managing an acquisition by bringing clients over in tranches, or creating the operational and hiring systems needed to build a lasting firm, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Kathy Longo.

Reclaim Your Time With A Fractional Admin Assistant: How To Evaluate The Right One For You

February 9, 2026 07:01 am 0 Comments CATEGORY: Practice Management

Many financial advisors reach a critical juncture in their growth known as the "capacity crossroads," when personal bandwidth becomes strained by increasing client demands. At this stage, advisors often need to begin determining what to delegate – and to whom. Administrative responsibilities are often the first to go, as these tasks are often repetitive in nature and usually less fulfilling for advisors (according to Kitces research). However, advisors looking to delegate administrative work may find themselves overwhelmed by too many choices, a phenomenon known as overchoice, where an abundance of options leads to decision paralysis. What may start as a simple intention to "get help with some admin work" can quickly spiral into hours of research, comparison, and uncertainty about what type of support is truly needed.

Hiring a fractional admin assistant offers an elegant solution for advisors who need help but aren't ready – or willing – to commit to a full-time employee. Fractional professionals can fill half-time or even quarter-time roles, bridging the gap between solo practice and a fully staffed firm. These roles are especially useful when the workload doesn't yet justify a 40-hour position or when advisors are experimenting with the delegation process. In addition to flexibility, experienced fractional assistants often require less onboarding time and can bring immediate structure, systems, and operational insight.

In this article, Sydney Squires, Senior Financial Planning Nerd, discusses how to evaluate various administrative assistant options, make an informed hiring decision, and onboard the assistant as smoothly as possible. Because not all administrative assistants are created equal, and success often depends on defining the scope of the role clearly. Advisors need to consider whether they want a strategic partner – someone capable of process design, workflow refinement, and judgment-driven tasks like calendar coordination – or an assistant focused on routine checklist-style tasks. Both roles are valuable, but identifying the dominant need helps narrow the candidate pool. A time audit or even a quick calendar review can help advisors determine what's consuming their time, what's most draining, and what logically groups together into a defined role. From there, advisors can distinguish between must-haves and nice-to-haves, setting the foundation for either a job posting or a targeted search among third-party providers.

Evaluating candidates effectively – whether through job boards or outsourcing platforms – means focusing on alignment of experience, work style, and availability. Advisors should be clear about expected hours, responsibilities, and whether there's potential for the role to grow. Interviews can help uncover a candidates' software familiarity, ability to handle sensitive information, and communication preferences. Once hired, onboarding goes most smoothly when centered on clear expectations, feedback mechanisms, and regular check-ins. While repetitive tasks may be handed off within weeks, more nuanced responsibilities may require a longer ramp-up period.

Ultimately, hiring a fractional assistant isn't just about reducing workload – it's about building capacity with intention. Advisors who successfully define, delegate, and onboard administrative help not only create more time for client-facing work and business development, but also lay the groundwork for smoother, more scalable operations. Over time, these assistants can become trusted partners, offering fresh insights and helping improve firm systems in ways that benefit both the advisor and their clients. With a clear plan and the right fit, even a few hours a week of support can lead to meaningful improvements in advisor wellbeing, firm efficiency, and long-term sustainability!

Weekend Reading For Financial Planners (February 7–8)

February 6, 2026 02:00 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" - this week's edition kicks off with the news that a survey from CFP Board finds that clients working with CFP professionals receive a wider range of detailed planning services and have greater trust with their advisors than those receiving financial advice from other financial advisors. Which could help those with the CFP marks stand out from the crowd when it comes to attracting new clients, though since these stronger numbers weren't universal across clients working with CFP professionals, it remains up to individual advisors to perform up to the standards set by their peer population.

Also in industry news this week:

Charles Schwab's CEO said recently that the company plans to ramp up its client lending options for RIAs on its platform, potentially giving these firms a greater ability to compete with wirehouses on securities-backed borrowing opportunities
Client referrals account for more than half of new clients at firms across industry channels, according to a survey from Cerulli, with referrals from Centers Of Influence (COIs) coming in second (suggesting that building these relationships could both result in prospect referrals and the ability for advisors to identify high-quality professionals for their own clients' tax and legal needs)

From there, we have several articles on retirement planning:

An analysis of different retirement income strategies identifies three that can help clients maximize their lifetime income in retirement (with advisors well-positioned to support clients in enacting these flexible spending strategies)
A study finds that unexpected expenses are quite common in retirement, with higher-income retirees being more likely to experience such an event in a given year and for these expenses to be higher
Why small-but-permanent adjustments to retirement spending can have a greater impact on a retirement income plan's sustainability compared to large-but-temporary adjustments

We also have a number of articles on practice management:

A formula to help advisory firms diagnose and predict their organic growth path shows the potential importance of prioritizing their value proposition for their ideal target clients
Why delivering an exceptional client experience isn't just about the specific tactics used, but also about having a unifying strategy to ensure consistency across advisors and clients within a firm
How firms can consider balancing the benefits of providing personalized service to clients with the efficiency gains available from greater systematization

We wrap up with three final articles, all about workplace trends:

Nine trends shaping the workplace in 2026 and beyond, from Artificial Intelligence's (AI's) impact on the hiring process to the imperative for companies (including advisory firms) of being aware of growing AI-enabled fraud capabilities
While many companies are asking their employees to work more days per week in the office, they are also balancing the tradeoffs (including employee retention and the costs of hosting more employees) that come with more in-office hours
How co-working spaces are experiencing a comeback following the pandemic, attracting not only remote workers and solopreneurs, but also larger firms seeking flexible workspaces

Enjoy the 'light' reading!

Should Advisors Provide Opinionated Advice Or Coach Clients To Choose Their Own Path?: Kitces & Carl 183

February 5, 2026 07:02 am 0 Comments CATEGORY: Kitces & Carl Podcast

Kitces & Carl Ep Should Advisors Provide

There is a juxtaposition in giving great financial advice: often, there is an objective 'right' answer to many financial planning questions… at least from a mathematical perspective. Yet the decision that best aligns with the client's real values is often less clear-cut. For example, there is an objective 'right' answer to whether to pay off a low-interest mortgage early or invest in the stock market, yet a client may prioritize being debt-free over the 'optimal' decision. For financial planners, the challenge lies in recognizing when clients need guidance versus when they need space to clarify what matters most to them. Advisors balance being the authority with being a facilitator, respecting the client's autonomy while also protecting them from avoidable missteps.

In this 183rd episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss how advisors can walk the line between the advisor's personal opinion, the 'objective' answer (when there is one), and the client's values – especially when a client wants to make an 'inoptimal' decision. A planner's values can unintentionally influence client decisions. Even the presence of an expert in the room biases what clients say and how they process options. For example, issues such as debt repayment, funding education, or discretionary spending often elicit strong emotions and financial judgments from planners. One advisor may bristle at a client wanting to pay off a low-interest mortgage, seeing it as inefficient, while another empathizes deeply, having celebrated mortgage payoff milestones themselves. Every financial decision intersects with personal values, making it difficult for planners to remain truly neutral.

Financial planning decisions often do not have one objectively 'correct' answer (regardless of what the spreadsheet says!). Trade-offs – such as those between short-term experiences and long-term security – must be framed in ways that honor the client's goals and values, not just the planner's analytical framework. This is where coaching and planning intersect. Advisors can bring technical clarity and model outcomes, but must also develop the emotional and relational skills to help clients make decisions they can own. When clients ask, "What should I do?" the invitation is not necessarily to command, but to co-create clarity – ideally after deep exploration of their motivations, fears, and hopes.

Ultimately, financial planning exists in a hybrid space between coaching and technical expertise. They are guides who can – and sometimes must – offer strong recommendations, but only after the client feels fully seen and heard. The deeper responsibility lies in helping clients make well-informed, value-aligned decisions, not just efficient ones. Asking follow-up questions, illustrating the outcomes of various decisions, and helping clients dive deeply into the trade-offs are all crucial to helping them sound out the true consequences of their decisions. This approach not only fosters better outcomes but also strengthens the client's sense of ownership and agency. Advisors who can recognize their own biases and stay curious about their client's worldview are better positioned to offer advice that resonates and endures!