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 a recent survey suggests Americans are increasingly prioritizing work-life balance over higher salaries, with 2/3 of respondents indicating that they would rather work at a job that they loved rather than a job they disliked but paid more money. Nonetheless, Kitces Research suggests that when it comes to financial advisors, those with sufficient experience can often have both, with thriving advisors earning more and working fewer hours!

Also in industry news this week:

• • With the new “T+1” rules for trade settlements will go into effect in late May, the SEC has issued a risk alert for broker-dealers and RIAs outlining the requirements they face and areas of focus for the regulator during upcoming examinations
  • A recent survey suggests that while client satisfaction with their financial advisors increased during 2023, more than a third of wealthy Millennials indicated they are planning to change advisors in the coming year

From there, we have several articles on prospect and client communication:

• How advisors can adapt their communication styles to match the personality types of prospects and clients
• Why focusing on diagnosing a prospect’s financial problems, rather than working to build a personal relationship, could be a more effective strategy to win clients
• How to craft an effective advisor website biography to show an advisor’s humanity and help prospects overcome their fear of reaching out for help

We also have a number of articles on wealth management:

• How building a team of advisors – including financial, legal, and mental health professionals – can help the recipient of a financial windfall manage both the technical and psychological aspects of their newfound wealth
• How financial advisors can support clients in processing the emotional and financial ramifications of receiving an inheritance
• How advisors can help newly wealthy clients avoid common pitfalls, including insufficient insurance coverage and the temptation to pay household workers ‘under the table’

We wrap up with 3 final articles, all about innovation:

• How chance hallway conversations led to one of the biggest breakthroughs in artificial intelligence technology
• How the interstate highway system not only allowed for faster travel around the country, but also facilitated the growth of the economy as a whole and the rise of national chains
• Why malls are turning to high-end stores, gyms, and experiences to reinvent themselves at a time when many traditional shopping centers are struggling

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 recently been cracking down on firms for recordkeeping failures related to electronic communications, including their use of text messaging with prospects and clients. Which could serve as a warning to firms to heighten their supervision of their advisors' texting practices and whether they are being recorded properly (perhaps with the help of available archiving tools)! 

Also in industry news this week:

• A recent survey suggests that advisors who best understand their prospects' and clients' unique needs and communicate their value and fees clearly could be best positioned to win and retain clients
• Why a dearth of advisor talent could spur additional M&A activity and 'poaching', and what firms can do to attract and retain team members 

From there, we have several articles on retirement planning:

• A survey indicates that financial and health planning in the pre-retirement years could lead individuals to have a more enjoyable retirement 
• Research suggests that individuals who want to (or have to) work after traditional retirement age will have opportunities to do so, though they might need to switch to a different field where their skills could be applicable
• A growing number of individuals are working into their 80s and beyond, with many choosing this path for the challenge and sense of purpose continuing to work can provide 

We also have a number of articles on the new "Spot" Bitcoin ETFs:

• The factors investors can use to determine whether investing in a Spot Bitcoin ETF is right for them and, if so, how to choose among the available funds 
• How the creation and redemption process of Spot Bitcoin ETFs differ from more traditional ETFs and what this means for the potential costs issuers and investors might pay 
• Why potential regulatory scrutiny might contributing to many advisors' reluctance to recommend Bitcoin ETFs for client portfolios

We wrap up with 3 final articles, all about real estate:

• How a recent settlement between the National Association of Realtors (NAR) and a class of homebuyers could upend how buyers and sellers pay for the services of real estate professionals 
• While both home buyers and sellers could benefit from lower commissions as a result of the recent NAR settlement, some buyers might face a cash crunch at closing
• How the recent NAR settlement could impact home prices as well as the negotiation dynamics between home buyers and sellers

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 final version of the Department of Labor’s (DoL) new “Retirement Security Rule” has been sent to the Office of Management for review, with the rule potentially going into effect in early 2025. While the final submitted text has not been released, some experts suggest that the DoL likely made few changes to its initial proposal, despite significant opposition from broker-dealers that could lead to the judicial system deciding the rule’s ultimate fate.  

Also in industry news this week: 

• CFP Board this week announced changes to its Sanctions Guidelines and revisions to its Fitness Standards that clarify the factors that determine how potential sanctions are determined and revise the framework use to determine whether a candidate is eligible to become a CFP certificant 
• The Financial Services Institute joined other trade groups in filing a complaint against the DoL’s independent contractor rule, arguing that it creates confusion about the status of many financial professionals who prefer to operate as independent contractors 

From there, we have several articles on tax planning: 

• The IRS has launched its free direct filing program, though it is currently limited to taxpayers in certain states and with relatively simple tax situations 
• Clients looking to rollover unused funds from 529 plans have the opportunity do so for both 2023 and 2024, with the deadline for 2023 fast approaching 
• President Biden’s budget proposal released this week includes a range of potential tax changes, from raising the top marginal rate to increasing the child tax credit 

We also have a number of articles on practice management: 

• RIA M&A activity appears to have picked up in the first quarter of the year, with a steady flow of interested buyers and sellers 
• Why integrating tech stacks, service offerings, and team cultures is crucial to the success of an RIA acquisition 
• How the headline purchase price often does not reflect the final price an RIA buyer pays and the amount the seller receives, highlighting the importance of careful negotiation of deal terms by both sides 

We wrap up with 3 final articles, all about Artificial Intelligence (AI) in the advisory industry: 

• How generative AI tools could transform the way knowledge workers, including financial advisors, operate, rather than replace them altogether 
• How lessons learned from the introduction of the digital spreadsheet can inform advisors’ future use of AI tools 
• How current advisor-facing software incorporates AI capabilities and why firm-specific tools might become more common in the future 

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 RIA clients of an insurance broker providing Errors & Omissions (E&O) coverage saw a 213% increase in claims paid in 2023, attributed to significant jumps in suitability claims (likely stemming from the 2022 market downturn) and claims related to wire fraud. Which suggests that financial advisory firms could potentially mitigate their potential exposure to future exposures by reviewing asset allocations with clients more frequently (to ensure they understand and approve of the advisor’s recommendations) and by maintaining strong policies and procedures related to client wire transfers (and ensure firm staff is trained on them!) to prevent fraud.

Also in industry news this week:

• A recent survey has found that a majority of prospective financial planning clients across all age brackets are open to working with a remote advisor, creating opportunities for advisors to grow their businesses and for clients to find the ‘best’ advisor for their needs, regardless of their location
• A federal judge has ruled that the Corporate Transparency Act, which requires small business entities such as LLCs and corporations to report identifying information on their "beneficial owners", is unconstitutional, raising questions about whether businesses (including certain non-exempt financial advisory firms) will be required to comply with its requirements

From there, we have several articles on practice management:

• Why many RIAs are experiencing high staff turnover and how a more deliberate approach when hiring could lead to more successful hires
• The key behaviors that can help a newly promoted manager succeed, including the need to set and communicate clear goals and the ability to provide regular feedback to team members (without micromanaging)
• How firms can avoid wrongful termination lawsuits, from establishing clear policies in employment agreements and employee handbooks to considering whether to offer departing employees a severance package

We also have a number of articles on investment planning:

• Why the well-known (and frequently judged) “60/40” portfolio could have a bright future, despite the poor returns it experienced in 2022
• While a diversified investment portfolio can offer significant risk-management benefits, it also tends to come with periods of underperformance that can be challenging for investors to withstand
• Why U.S. stocks have dominated their international counterparts during the past decade and whether it still makes sense to have exposure to international equities

We wrap up with 3 final articles, all about decision-making:

• Why research suggests that individuals make their best financial decisions in their early 50s and how advisors can support clients across the age spectrum based on their unique skills and weak points of view
• Why it’s important to recognize that there often is no “Secret Option C” when it comes to make a challenging decision with 2 distinct options, and how advisors are well-positioned to help clients overcome the tendency to put off these tough choices
• How a structured framework can help advisors make decisions when a seemingly unlimited number of options are available, from choosing a niche to deciding what to discuss when leveraging content marketing

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 Biden administration could seek to release the final version of the Department of Labor (DoL)'s proposed "Retirement Security Rule" this year, potentially with a January 1 effective date, to ensure it goes into effect before a potential change in administration. Nevertheless, given the contentious nature of the proposal as it currently stands (with the brokerage and insurance industries levying heavy criticism of the rule), its ultimate fate (including whether its scope might be narrowed) is likely to be determined in the courts.

Also in industry news this week:

• Financial scams involving social media and digital assets are on the rise, according to NASAA's annual enforcement report, and advisors can play a valuable role in helping their clients avoid becoming victims  
• A report suggests that firms with intentional, integrated tech stacks as well as those that are able to establish strong brand identities will be better positioned to succeed in the years ahead 

From there, we have several articles on practice management:

• A lawsuit alleges that several wealth management companies established an anti-competitive "no-poach" agreement that limited opportunities for their employees to change firms
• A separate lawsuit is challenging a firm's non-compete agreement, alleging that it goes too far in restricting employees' professional activities if they decide to pursue other opportunities
• How firms and their advisors can create mutually fair non-solicit agreements that reflect the 'skin in the game' contributed by each party

We also have a number of articles on retirement:

• Why the Federal government might decide that the benefits of tax-advantaged retirement accounts do not outweigh the costs, potentially putting 401(k)s and other plans in the crosshairs
• Proposed legislation would mandate that most companies with more than 10 employees provide defined-contribution retirement plans, potentially expanding the pool of employees with access to tax-advantaged accounts 
• How advisors can support younger clients by putting the challenges facing the Social Security system into context and showing them how potential changes would affect their financial plans

We wrap up with 3 final articles, all about money psychology:

• Why the traits that can help entrepreneurs succeed in business can lead to challenges elsewhere in their financial lives, and how financial advisors can help them evaluate their options
• Why 'frugality' is not just a matter of spending as little as possible, but rather living in a way that allows an individual to spend time on their most important priorities
• 31 money lessons 1 author has learned over the course of his career, from the importance of putting one's income and wealth into perspective to the benefits of living generously

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 while both the total number of RIAs and advisor headcount have seen significant gains in recent years, client assets remain concentrated among the largest firms, according to data from Cerulli Associates, with the 7% of RIAs with at least $1 billion of AUM managing 71% of total RIA assets. Which suggests that instead of trying to go head-to-head with these larger firms (and their heftier marketing budgets) in attracting clients, smaller firms might instead demonstrate how they are 'different' by offering a unique service offering tailored to their ideal target clients. 

Also in industry news this week:

• A recent study has found that advisors who gain additional credentials tend to see a boost both in their confidence and in their business metrics, with the CFP certification standing out in terms of value
• The implications for RIAs of a proposed Treasury Department rule that would subject many firms to certain anti-money-laundering regulations for the first time

From there, we have several articles on advisor marketing:

• How advisors can adjust their email distribution practices to ensure their marketing messages are delivered amidst a crackdown on spam among major email providers
• How leveraging Artificial Intelligence (AI) tools can help advisors create personalized marketing content more efficiently
• 3 potential marketing strategies for advisors that come with zero (hard dollar) cost 

We also have a number of articles on investment planning:

• How the growth of index funds (to the point that they have surpassed actively managed funds in terms of total assets) has changed the business of financial advice
• The potential benefits of customized bond ladders for clients and how they could complement direct indexing strategies
• While a recent research paper suggests that investors across the age spectrum could benefit from maintaining a 100% equity portfolio, the benefits (and potential risks) of such an approach might be overstated

We wrap up with 3 final articles, all about financial advisory business trends:

• Why robust demand among larger, often PE-backed, RIAs, combined with the challenges facing smaller, 'tweener' firms, could lead to robust M&A activity in the year ahead 
• How the United States has experienced a productivity 'boomlet' in recent months and how advisory firms could further boost their efficiency
• Industry veteran Bob Veres offers his predictions for 2024, including an increasing number of next-generation advisors breaking off to start their own firms amidst industry consolidation and a growing role for AI in advisors' tech stacks

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 a study from Cerulli Associates indicates a lack of fee transparency represents a significant hurdle for many investors when considering working with a financial advisor. Which suggests that while advisors might be hesitant to publish their fees on their website before being able to meet face-to-face with prospects, doing so (and linking the fees to the value proposition they offer their ideal clients) could help certain consumers overcome their reluctance and start the process to becoming clients! 

Also in industry news this week:

• While AUM fees remain ubiquitous among fee-only advisors, recent data show that an increasing number leverage multiple fee models to meet different client needs and preferences
• While CFP Board has come out firmly in favor of the Department of Labor's proposed Retirement Security Rule, FPA has taken a more cautious approach, expressing concern about the potential compliance costs of the proposal for advisory firms

From there, we have several articles on advisor marketing:

• A 5-step process advisors can use to build relationships with Centers Of Influence (COIs) and generate more prospect leads
• Why the effective use of lead-generation services typically requires advisors to have plenty of free time to follow up with the leads they receive
• Best practices for how advisors can use webinars to generate client leads, from leveraging effective email campaigns to creating near-term follow-up opportunities

We also have a number of articles on spending:

• Why the relationship between spending and happiness is not linear, and what this phenomenon means for client spending and life satisfaction
• How the differences between being "frugal" and "independent" can call for different advisor recommendations when it seems that clients are spending less than their income and assets allow
• Why "Coast FIRE" might be an attractive strategy for clients who want more flexibility during their working years but don't want to stop work completely

We wrap up with 3 final articles, all about reading and writing:

• How a daily writing practice can bring a range of personal and business benefits, from greater clarity of thought to building a professional brand
• How experimental data suggests that taking notes by hand, rather than typing them out, could lead to more effective learning
• The challenge of reading (and finishing) books amid a growing number of distractions and potential solutions to enable greater focus 

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 a recent survey sponsored by CFP Board demonstrates the upsides of a career in financial planning, from a median salary of nearly $200,000 to flexible work schedules and a strong sense of purpose among advisors. In addition, related research suggests further opportunities for firms looking to acquire and retain talent, from providing a greater sense of autonomy to building effective service teams.

Also in industry news this week:

• A recent study finds that having a defined marketing strategy is a linchpin of marketing success, as advisors with a defined strategy were more likely to have seen an increase in inbound leads during the past 12 months and have more confidence in meeting their practice goals during the coming year than those without one
• The number of RIA-focused annuity marketplaces and their sales volume continues to grow as many brokers turn to the RIA channel and commission-free annuity offerings make annuities more attractive to fee-only advisors

From there, we have several articles on advisor marketing:

• How creating content that answers the questions of a firm's ideal target client can help it build trust with prospective clients even before meeting with them
• How advisors can best leverage client testimonials and reviews, including why video is often the most effective medium to deliver them 
• How advisors can effectively ask for client referrals without coming off as too 'salesy'

We also have a number of articles on cash flow and spending:

• How advisors can help clients better understand the "why" of their spending habits
• Why a significant number of younger Americans are suffering from "money dysmorphia" and how advisors can help them see the reality of their finances
• An exploration of research-backed methods for generating the most happiness when it comes to spending money, from 'buying' time to delaying consumption

We wrap up with 3 final articles, all about saying "no":

• How curating a shorter to-do list can help individuals overcome "planning bias" and get more done on time  
• Why saying "no" to invitations and opportunities can free up time for one's highest priorities
• Experimental findings suggest that people tend to overestimate how upset those offering an invitation will be if the invitee decides to decline it, suggesting that individuals can keep more free time in their schedule without burning bridges with friends and family

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 a Morningstar survey has found that financial advisory clients are more likely to stick with their advisor for emotional reasons rather than investment returns alone. Which suggests that building trusting relationships with their clients and giving them added confidence in their financial decision-making (rather than focusing on ways to juice investment returns) could be the keys to improving client retention!

Also in industry news this week:

• A recent study from advisor digital marketing firm Snappy Kraken suggests firms that invest in Search Engine Optimization (SEO), have a regular cadence of emails to their subscriber list, and include video content in these messages tend to get greater returns from their marketing efforts 
• CFP Board has created a guide to help financial advisors vet potential technology providers to ensure not only that software tools will provide accurate outputs for the advisor's clients, but also will allow the advisors to remain in compliance with relevant regulations

From there, we have several articles on practice management:

• A step-by-step guide to the process of buying or selling an RIA, from the due diligence undertaken by both the buyer and seller to the legal documents that can protect both parties
• While the number of minority investments in RIAs slowed down in 2023, they could pick up as some founders nearing retirement are finding their next-gen advisors are unable to buy them out in full
• Why private equity dollars continue to flow into the RIA space and how these investments differ from the common private equity "fix and flip" approach

We also have a number of articles on cash flow and spending:

• The IRS has debuted its Direct File online portal to allow (a relatively small group of) consumers to file their taxes directly through the IRS website for free, though many might still choose to use more advanced software or human tax preparers
• While the new FAFSA form is simpler than its predecessors, its delayed rollout is causing headaches for some families with students applying to college this year
• Why a measure in "SECURE Act 2.0" allowing transfers of leftover funds from a 529 plan to a Roth IRA could give clients more confidence in funding these education savings accounts

We wrap up with 3 final articles, all about health and wellness:

• Why an individual's "healthspan" could be even more important than their lifespan when it comes to determining their happiness and potentially merits consideration when preparing a financial plan
• How maintaining muscular strength can play a key role in promoting health as one ages and why regular weightlifting sessions are not necessarily required to do so
• How caffeine can provide a variety of health benefits in addition to providing a jolt of energy

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 of a survey indicating that about 90% of financial advisors would switch firms based on bad technology at their current firm, and that 44% have already done so. The survey also suggests that a firm's tech stack can affect its ability to attract and retain clients, with 93% of advisors who said they work with state-of-the-art technology reporting that they have added new clients as a result of another firm's bad technology, and 58% of all advisors surveyed reporting they had lost new business due to bad technology.

Also in industry news this week:

• A House committee has advanced a bill that would extend several expired business-related tax measures from the Tax Cuts and Jobs Act and would increase the value of the Child Tax Credit
• The SEC released its examination priorities for 2024, which include a focus on advisers' adherence to their duty of care and duty of loyalty obligations, including when recommending complex investment products

From there, we have several articles on marketing:

• How financial advisors can address the "Curse of Knowledge" to communicate more effectively with prospects and clients
• How advisors can overcome "impostor syndrome" and market themselves effectively when serving a niche clientele
• How advisory firm owners can better align their staffing and marketing expenses with their growth goals

We also have a number of articles on retirement planning:

• A variety of limits and rules related to retirement planning are changing in 2024, introducing several potential opportunities for financial advisors to use with their clients
• Why financial advisors and retired clients themselves might both be responsible for the relative lack of popularity of immediate annuities, despite the potential benefits they offer
• How retirement income guardrails could help retired clients spend down their assets in a sustainable manner in a variety of market environments

We wrap up with three final articles, all about Artificial Intelligence (AI):

• How Enterprise Large Language Models could help advisory firms overcome the privacy and compliance challenges of using publicly available AI tools
• Why skilled human translators continue to survive amidst competition from AI, and the potential lessons their experience offers for financial advisors
• Why certain AI tools are less cost-effective than human workers for many job functions

Enjoy the 'light' reading!

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