Archives Of Weekend Reading For Financial Planners

Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that the U.S. Senate has passed the Inflation Reduction Act, which while being light on individual tax changes, nevertheless includes some important financial planning provisions such as prescription drug price relief for Medicare enrollees, continuation of expanded Affordable Care Act healthcare premium subsidies, and tax credits for energy efficiency upgrades to homes.

Also in industry news this week:

• FINRA has submitted a revised proposal to reform the process for broker-dealers to request expungement of client disputes from their public record, which allows state securities regulators to be informed of and involved in the arbitration hearings that decide whether the expungement is granted
• As RIA firms’ challenges in attracting and retaining talent have continued, firms have needed to reduce their business development activities to stay within their existing staff's capacity (compounding the challenges of growing firm revenue during a bear market that has reduced most firms’ assets under management)

From there, we have several articles on Mergers & Acquisition (M&A) trends:

• M&A activity so far in 2022 is set to exceed 2021’s record pace despite economic headwinds, meaning there could simply be a ‘new normal’ of higher activity regardless of the economic environment
• With the shift from bull market to bear market, the risks of M&A deals have shifted for sellers of RIA firms, leading to a significant change in how many M&A deals are structured so sellers can still get some ‘upside’ if markets recover from here
• With the pace of M&A deals being dominated by a small number of cash-rich ‘serial acquirers’, smaller RIAs looking to acquire firms need to rely more on their ability to match the selling firm’s culture and values to find a competitive advantage with the mega-firms

We also have a number of articles on retirement:

• Though owning an RV and traveling the country is a popular retirement pastime, those with the resources can turn their motorhomes into a luxury vacation home on wheels (at about the same price as buying a second home)
• Many retirees seek to relocate after their working years, but deciding where to move requires some reflection both on the lifestyle the retiree wants to lead as well as the practical and financial considerations of doing so
• A number of rural areas are seeing a ‘gray wave’ of retirees moving in to take advantage of natural attractions, low costs of living, and a leisurely pace of life (though as those areas grow in popularity and size, they might not be quite as attractive as they once were)

We wrap up with three final articles, all about career decisions:

• On the heels of the ‘Great Resignation’ of 2021, many employees who changed jobs (and the employers who hired them) are now realizing their decisions might have been short-sighted
• Though employees and business owners often feel pressured to follow what others have done to become successful, embracing one’s own unique properties can make it easier to stand out from the crowd
• The pandemic has led many workers to embrace the idea of taking pre-retirement breaks from work – but doing so involves working around the retirement structure that is structured around the ‘traditional’ idea of retirement

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that the SEC has issued a new bulletin clarifying the responsibilities of brokers under Regulation Best Interest (Reg BI). The guidance indicates that, despite early fears that Reg BI was ‘overly accommodating’ to the brokerage industry, the Commission is expecting that reducing conflicts of interest should be an ongoing task for broker-dealers rather than a one-time compliance disclosure change, and that brokerage firms will want to ‘show their work’ when it comes to their compliance responsibilities (a potential best practice for RIAs, too!)!

Also in industry news this week:

• A study suggests that a significant number of brokers who are disciplined by FINRA are engaging in ‘regulatory arbitrage’ by moving to state-regulated insurance companies, making it more difficult for consumers to learn about their past infractions
• How the proposed “Inflation Reduction Act” will impact financial advisors and their clients

From there, we have several articles on advisor content marketing:

• How advisors can generate topic ideas for content to engage their target audience
• The best practices (and pitfalls to avoid) for advisors when crafting an email subject line
• Why campaigns that combine “sunk marketing” with “momentum marketing” can lead to greater results for advisors

We also have a number of articles on retirement planning:

• How the variability in annuity payouts across annuity providers has exploded in 2022, creating an opportunity for advisors to add value to clients by comparison shopping across insurance companies
• Why state long-term care insurance programs are driving demand for private policies, and the implications of these programs for advisors and their clients
• How advisors can support clients in choosing a Medigap policy

We wrap up with three final articles, all about the advisor regulatory landscape:

• Why better regulation of the insurance industry could make life easier for financial advisors
• What advisors need to know about the new IAR continuing education requirements
• Why pursuing title reform for financial planners is a worthwhile endeavor, even if it might be a bumpy process

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with a survey indicating that while about 70% of advisors overall feel successful, those who charge fees (and enjoy the stability that recurring fees provide) tend to feel more successful than those who rely on less-stable commissions, with the effect being particularly pronounced for female advisors.

Also in industry news this week:

• A survey suggests that consumers recognize that they are keeping more money than they should on the sidelines as they maintain a pessimistic outlook for markets and the economy
• Why a recent SEC settlement is a warning that large RIAs need to pay close attention to the revenue sources of an affiliated broker-dealer

From there, we have several articles on advisor fee models:

• How advice-only fee models can offer advisors greater flexibility in their service offerings and the clients they serve
• Why creating an annual client service calendar is a helpful way to demonstrate an advisor’s value proposition to clients and regulators
• How advisors can overcome the “Triple Whammy” of having too much work for too many clients for too little money

We also have a number of articles on mortgages:

• How holding on to a mortgage while investing is a form of leverage, and why a mortgage itself is not an inflation hedge
• How advisors can add value to clients considering cash-out refinances
• Why some clients see home renovations as a way to delay inevitable bad news

We wrap up with three final articles, all about the current work environment:

• The best practices, from happy hours to retreats, advisory firms can use to maximize the hybrid work environment
• Why co-working space is the new ‘hot’ amenity in apartments and condo buildings
• Why the return of in-person conferences is attracting parents who want to get out of the house, and the wide range of upcoming conferences for advisors

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that the Financial Planning Association has announced a major new advocacy initiative: to pursue legal recognition of the term “financial planner” through title protection (such that those who don’t meet the competency and ethical standards of financial planning wouldn’t be permitted to use the title). Though in recognizing that the path toward regulation is likely to be a long one, as a starting point, the FPA has simply pledged to begin exploring how to pursue Title Protection, what kind of licensing or regulation it might entail, and whether it should be done at the state or Federal level.

Also in industry news this week:

• A Schwab benchmarking survey shows that RIAs had strong top-line and organic growth in 2021 and that a potential talent crunch remains top of mind for firm leaders
• RIA consolidation activity maintained a strong pace in the first half of 2022, with large strategic acquirers leading the pace of M&A activity

From there, we have several articles on the value of financial planning:

• Why it is vital for advisors to focus on their clients’ understanding of the value they are receiving, as well as what separates the advisor’s value proposition from the client’s other options
• Why it is important for advisors to not only consider a client’s financial assets, but also what brings them purpose and meaning, when providing financial planning services
• How an advisor’s professional network and industry experience can provide significant value to clients that goes beyond their net worth statement

We also have a number of articles on retirement income planning:

• Why simple strategies like a phased retirement and flexibility in spending could trump more complicated retirement income planning techniques
• How “buffer assets” could help clients overcome the financial and emotional turmoil caused by bear markets
• Why it typically pays for clients to make portfolio withdrawals for retirement income gradually throughout the year rather than as a lump sum in January

We wrap up with three final articles, all about the housing market:

• How rising house prices are changing the composition of neighborhoods across the United States and how advisors can help clients navigate these dynamics
• Why many Americans, including families and retirees alike, are choosing to move to Europe and how doing so can affect their financial plan
• How some cities and towns across the U.S. are providing incentives – from cash to free babysitting – to attract high-income remote workers and why a move could be attractive for advisors and their clients alike

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that investors this year have filed 37 arbitration cases with FINRA related to alleged violations of Regulation Best Interest (Reg BI). These come on the heels of the SEC’s first enforcement action related to Reg BI, suggesting that industry participants might soon get more clarity on the regulation’s requirements and the consequences for not adhering to them… and that regardless of how slowly the SEC acts in enforcing Reg BI, the plaintiff’s bar is beginning to take the matter into their own hands by filing complaints against brokers who fail to act in their clients’ ‘Best Interests’.

Also in industry news this week:

• Democratic Senators have proposed to extend the 3.8% Net Investment Income Tax to high-income-owners’ S corporation profits as part of broader legislation, but this measure appears to be on shaky ground
• Why a recently announced SPAC merger could lead to additional opportunities for breakaway brokers to transition to the RIA model

From there, we have several articles on practice management:

• How the use of a tiered fee structure or a retainer model can help insulate advisory firm revenue from the effects of a bear market
• At a time when costs are up and revenues are down for many advisory firms, why simplifying the firm’s value proposition and pursuing operational efficiencies can help prevent margins from tightening further
• Why bigger isn’t always better when it comes to the number of clients an advisor serves, and why pursuing a niche market can provide benefits to an advisor’s professional and personal lives

We also have a number of articles on advisor marketing:

• A recent survey suggests that younger clients are more sensitive to advisory fees and are interested in hybrid solutions that combine human advice with digital tools
• Wealthy millennials have a high degree of trust in advisors and are looking for them to be literate in assessing ESG data, according to a recent study
• Why investors prefer advisor marketing that asks questions about prospects and avoids industry jargon

We wrap up with three final articles, all about leadership:

• What advisory firm leaders can do to help their teams work smarter, not harder
• Why ‘unblocking’ might be the most important task a manager can complete during their day
• How taking a structured approach can help you become more like your role models

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with a recent study indicating that 15% of employee advisors at wirehouse firms and 7% of independent advisors affiliated with a broker-dealer are considering leaving their firm in the next one to two years. Of those most likely to stay, retention was driven primarily by the quality of the firms’ technology offering, the breadth of its products and services, and the corporate culture set by the leadership of the firm. Though notably, dissatisfaction among employee advisors tended to increase with industry tenure, suggesting that some firms could potentially lose advisors with the largest books of business, potentially creating an opening for competing firms to bring on seasoned talent (and client assets)!

Also in industry news this week:

• How advisors are planning to grow despite the current bear market’s negative impact on assets under management
• Two years after its implementation, the SEC is planning to draft additional guidance to help advisors better understand Reg BI and ensure it delivers on its investor protection goals

From there, we have several articles on practice management:

• How setting Objectives and Key Results (OKRs) can help ensure all employees are working toward common firm goals
• How advisors can leverage the Entrepreneurial Operating System (EOS) to systematically manage and grow their firms
• What it takes to build lasting influence, and why it has little to do with social media follower counts

We also have a number of articles on cash flow management:

• How advisors can work with younger clients who want to financially support their parents or other loved ones
• How to prevent money issues from derailing a friendship
• The importance for advisors of recognizing the different preferences clients have for spending and saving their money

We wrap up with three final articles, all about psychology:

• Why setting “process goals” can help advisors create routines that endure after their larger goal is achieved
• Why advisors might not want to worry the next time they start (literally) sweating a stressful situation
• Why chosen suffering is an important part of achieving a life of happiness and meaning

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that RIAs experienced growth across a range of metrics in 2021, from the number of SEC-registered firms (up 6.7%), to assets under management (up 16.7%) and clients (up 6.4%). Combined with shrinking numbers of broker-dealers and their registered representatives in the latest FINRA Snapshot, this RIA growth signals the continued shift from product-based to advice-centric planning, as more and more advisors restructure their firms from broker-dealer to RIA!

Also in industry news this week:

• At a time when more than one-third of financial advisors are expected to retire in the next 10 years, a quarter of these advisors are still unsure about their succession plans, raising the question of whether they will begin internal succession plans soon or simply wait to be acquired by a larger firm when it’s time to retire
• Why the SEC’s first enforcement action under Regulation Best Interest disappointed consumer advocates by focusing on sales behavior that would have even been questionable under the prior suitability standard

From there, we have several articles on retirement:

• How advisors can successfully guide clients from the accumulation phase to the decumulation stage of their financial lives
• Why it is important to treat financial independence as a journey rather than a destination and how advisors can support clients on this path
• Why retirement often means a shift to new activities and routines rather than a total absence of structure

We also have a number of articles on practice management:

• Why it is important for firm leaders to take a personal interest in the lives and professional success of their employees
• Why setting expectations, regular communication, and mutual respect for company cultures are key to ensuring a successful relationship between advisory firms and their strategic partners
• The range of compensation structures firms can consider implementing to attract and retain employees during the current tight labor market

We wrap up with three final articles, all about vacations:

• Why taking vacations is important to advisor wellbeing and how to set expectations with clients and coworkers to make the time off more relaxing
• How new advisors can prepare for their first vacation, from informing management well in advance to creating how-to videos for co-workers covering their responsibilities
• Why crafting an effective out-of-office message can make or break a vacation

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that the Senate has passed companion bills to the House’s “SECURE 2.0” proposals that would represent the most noteworthy changes to retirement savings since the original SECURE Act was passed in 2019. While changes could be made to the proposals as the Senate and House bills are reconciled, strong support for the measures in both chambers suggest that there could be major changes to the retirement landscape by the end of the year (from increasing the age when RMDs begin, to the ability to use retirement distributions to fund long-term care insurance), that could come with significant planning implications in the years that follow!

Also in industry news this week:

• The SEC is considering extending its regulation of advisors to ‘information providers’, such as index providers and model portfolio makers, which could clarify the roles and responsibilities of these companies while further stretching the SEC’s inspection bandwidth
• A recent survey suggests that clients of financial advisors have more confidence in their financial situation than consumers without advisors across a range of measures, from saving enough for retirement to controlling the amount of risk in their portfolios

From there, we have several articles on tax-planning strategies:

• While tax-loss harvesting has gained newfound attention during the current market downturn, other tax-planning strategies, including asset location and Roth conversions, can also provide significant value to clients
• Amid proposals to move the RMD age back further, advisors and their clients can consider the potential value of strategic withdrawals and Roth conversions before reaching RMD age
• Why direct indexing is gaining in popularity among a broader base of advisors, and why its uses for clients go beyond tax management

We also have a number of articles on investing:

• Why retail investors are increasingly turning to private-market investments and the potential benefits and risks of doing so
• The implications for advisors of a recent study exploring the characteristics that make it more likely someone will ‘panic sell’
• Why alternative investments could potentially be valuable additions to client portfolios in the current market and economic environment

We wrap up with three final articles, all about the drivers of professional success:

• Why specialists often have a leg up on generalists as an industry matures and what this means for financial advisors
• Why emotional intelligence and organization are more important than ‘book smarts’ for achieving success in the 21^st century
• Why personal experience is necessary to gain understanding and mastery of a profession, including financial planning

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that Charles Schwab has agreed to pay $187 million to settle allegations that it misled users of its Schwab Intelligent Portfolios robo-advisor platform by falsely claiming that the cash allocations in its model portfolios (which were significantly higher than its competitors) were determined through a ‘disciplined portfolio construction methodology’ when regulators ultimately determined they were pre-set to generate a desired amount of revenue for Schwab. In other words, even as Schwab advertised that it was not charging a platform fee for the service, Schwab’s large cash allocations in the portfolios were still set to incur a cost for its clients, serving as a ‘hidden’ fee for an otherwise ‘free’ service, which the regulators treated as a violation of the antifraud (no-misleading-advertising) provisions of the Investment Advisers Act. Which in turn raises questions of whether regulators will eventually apply a similar scrutiny to the similar pricing model offered to RIAs using custodial platforms as well?

Also in industry news this week:

• Why it is important for advisory firms to review their compliance and disclosure practices in the wake of a new Department of Labor regulation regarding rollovers of workplace retirement plans and IRAs
• How the term ‘ESG’ has lost much of its meaning and how advisors can serve clients who want to take a values-based investment approach

From there, we have several articles on this year’s market volatility:

• The tools advisors are using to help clients stay the course during the current market downturn
• While the 60/40 portfolio has come under fire amid the poor performance of stocks and bonds this year, the classic asset allocation could now be more attractive given improved stock and bond valuations
• Why the day the market seems to be at its worst is often one of the best times to buy

We also have a number of articles on bear markets:

• Five things advisors can keep in mind during bear markets to provide clients with a long-term perspective
• Why a trend following strategy can be an effective risk management tool for a portion of some client portfolios
• Why reading books and prioritizing sleep can help advisors and their clients lower their stress levels during bear markets

We wrap up with three final articles, all about putting money in perspective:

• While it seems like the worst of times when it comes to the economy and world affairs, the historical record shows how much things have improved over time
• How those with better numeracy skills tend to have higher incomes and greater happiness
• Why building wealth is not an end in itself and how money can be used to facilitate health and happiness

Enjoy the ‘light’ reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” - this week’s edition kicks off with the news that amid public interest in the potential conflicts of interest involved in ‘payment-for-order flow’ arrangements between brokerages and market-making firms, SEC Chair Gary Gensler has asked agency staff to explore various ways to make the U.S. equities market more transparent and fair, including potentially creating an order-by-order auction mechanism to help retail traders obtain the best pricing for their orders. While payment-for-order flow arrangements have likely subsidized the dramatic reduction in direct trading costs during the past several years (as well as ‘free’ custodial services for advisory firms), questions remain as to whether the practice leads to better trade execution (and lower indirect costs) for investors compared to alternative arrangements… and whether potential changes from Gensler could alter how brokerage firms (and advisors’ custodians) price their own services.

Also in industry news this week:

• RIA aggregator Homrich Berg announced a $75 million debt financing agreement through a multi-bank syndication, demonstrating that RIAs looking to access capital do not necessarily have to give up an equity stake in the business
• Invesco and Cerulli Associates have launched a free benchmarking tool allowing advisory firms to compare themselves to the rest of the industry on a range of metrics, from AUM growth to client services

From there, we have several articles on inflation:

• What advisors are doing to help their clients cope with the current elevated levels of inflation
• 8 inflation conversations advisors can have with their clients, from creating a cash management strategy to reassessing long-term inflation assumptions
• Why recent declines in the prices of key inputs could lead to a cooling of prices for consumer goods

We also have a number of articles on retirement planning:

• How a new study shows that a typical retirement is made up of four stages, with the first beginning during the working years
• How recent research shows why personal health, anticipated health care costs, and legacy desires help explain why individuals choose not to smooth their consumption throughout their retirement years
• The seven non-financial investments individuals can make during their working years that can lead to greater happiness in retirement

We wrap up with three final articles, all about advice:

• 10 key lessons from some of the most successful companies, from Stripe’s diligent recruiting practices to why Red Bull outsources production of its own beverages
• The big ideas that changed one author’s life, from understanding the importance of tribes to the importance of learning from history
• 47 lessons learned over the course of one writer’s first 30 years, from when to take risks to the importance of being intentional in your decision making

Enjoy the ‘light’ reading!

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