Archives Of Weekend Reading For Financial Planners

Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with comments from President-Elect Trump's former campaign manager and now senior advisor Kellyanne Conway that Trump's views on the DoL fiduciary rule "don't necessarily jibe" with the oppositional views of his advisors... and when coupled with Trump's recent selection of Andrew Puzder as his new Labor Secretary, suggest that a Trump repeal the DoL fiduciary rule really may not be coming once he takes office.

From there, we have a number of marketing-related articles this week, including: how to craft your 2017 marketing plan; tips to improve client communications (particularly via email and social media); the marketing advantages (or not) in writing a book to establish your credibility as an expert; how to refine your prospect and new client experience to be of consistent quality (especially when it's delivered by more than just the founding advisor themselves); and the announcement of a new "Mystery Shopper" service that Fidelity is making available to RIAs that will allow them to engage a market research firm to pose as prospects and provide feedback on their marketing and sales process.

We have a few more technical articles this week as well, from a look at the ongoing struggles of traditional LTC insurance (with the recent news that LTC insurer Penn Treaty will have to be liquidated, in what may be the largest insurance insolvency in 25 years), to a recent new study that finds life expectancy actually declined last year in the US (for the first time in over 20 years), and the results of an analysis of the predictive value of Morningstar star ratings which finds they have slightly positive predictive value, but only very slight.

We wrap up with three interesting articles: the first is a look at new economic research quantifying, for the first time, how likely it is someone achieves the "American Dream" by being more financially successful than their parents, and finds that the odds of generational improvement have plummeted since World War II from a high of 92% to what today is no better than a 50/50 coin flip, driven partially by slowing economic growth but even more by rising income inequality; the second is a discussion of the increasingly popular retirement strategy of "retiring at sea", and making a cruise ship your second or even primary home in retirement (with a growing number of large cruise ships offering "residence at sea" apartments to accommodate extended-term travelers, in some cases at prices even lower than a local assisted living facility!); and the last is a good discussion of the ever-present question "how much is enough", which despite being a core focus of financial planning, faces a challenging reality that figuring out the answer to the question has both a quantitative and a highly qualitative component.

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Enjoy the current installment of "weekend reading for financial planners" - this week's leading news is that the Department of Labor has won yet another of its cases on the fiduciary rule, as indexed annuity provider/distributor Market Synergy Group has failed in its attempt to have the rule blocked or repealed. While there are still many cases left to resolve, and the potential for appeals, the DoL going 2-for-2 in the past month is a promising sign that the fiduciary rule may be here to stay.

From there, we have several practice management articles this week, specifically around the hiring and compensation process that often comes at the end of the year, from a look at when it makes sense to hire another advisor, to the importance of creating a career track and compensation plan for employees (which is better than the "compensation crisis management" approach of only addressing the issue when an employee reports he/she is about to leave!), and a look at how firms are starting to formulate career tracks and long-term compensation plans to retain the best talent.

We also have a few more technical planning articles, including: a reminder to look at potential year-end capital gains distributions from mutual funds and whether clients should switch to another investment before the distribution happens; how HSAs are starting to gain real momentum (but disproportionately amongst "older" workers aged 55+, who may be contributing to the HSA more as a retirement supplement than simply to cover upcoming health insurance deductibles as originally intended); factors to consider when a client has a potential NUA distribution; and how lifetime immediate annuities can still make sense, even in a low-yield environment, because the reality is that the annuity "income" is actually a combination of interest, principal, and mortality credits (which means interest rates alone only play a moderate role in setting the payouts).

We wrap up with three interesting articles: the first is a look at Julie Littlechild's research on how when advisors make personal breakthroughs in their business, it tends to follow a consistent three-stage process to change; the second is a reminder that while lots of us have work and obligations to do, the greatest success comes to those who are initiators, getting ideas off the ground and going above and beyond the bare minimum required; and the last is a fascinating look at the research showing that most of us have tens of thousands of thoughts that flitter through our heads all day, of which a whopping 80% are negative... which means our success will be determined heavily by our ability to silence the voices and change our beliefs and focus on the positive that allows us to really move forward.

And be certain to check out Bill Winterberg's "Bits & Bytes" video at the end, which this week includes coverage of WisdomTree's $20M capital investment into robo-advisor-for-advisors Vanare (which is also rebranding to AdvisorEngine going forward), a favorable review of new financial planning software provider RightCapital, and an inside look at the capabilities of portfolio performance and accounting software challenger Addepar.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with a growing number of advisor surveys showing that more and more advisors are worried about losing clients over their fees... even though there's little evidence to show that any material number of advisors actually are losing existing clients over their fees. Also in the news this week is an announcement from the CFP Board about changes to the CFP CE rules, which won't impact most people, but will have consequences for those who earn CE by teaching, writing, giving presentations, or self-reporting CE credits from non-registered CE sponsors.

From there, we have a few marketing and technology articles this week, from how to create incentives that build your digital marketing email list, to the most common mistakes that advisors are still making when it comes to social media marketing, how to set up an online calendar scheduling tool on your website (and why it matters), and some interesting thoughts from Joel Bruckenstein on the state of financial advisor technology and where it still needs to improve.

We have several practice management articles as well, including: the 7 phases of the client experience as someone moves from prospect to client to referrer (and the issues to consider at each stage to help clients move forward); tips to become a better listener to clients (and what it really means to truly listen effectively); and common myths about getting client referrals (e.g., that asking more for referrals is the best way to get more, when in reality it usually is not helpful at all).

We wrap up with three interesting articles: the first is a look at five different "types" of retirement, as the very nature of retirement itself morphs from the traditional work-save-retire to aggressive early retirement, part-time permanent semi-retirement, and various forms of on-again-off-again temporary retirement; the second is a review of a new white paper suggesting that the classic "active management is a zero sum game" paper by Bill Sharpe may be flawed and that there is probably at least some slight positive sum for active management (at least, before fees); and the last is a look at another study trying to quantify the value of financial advice, finding that an advisor can add a whopping 3.75% of value... with the caveat that more than half the value is simply helping the client not harm themselves.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with several big news stories, including a look at the SIFMA/FSI lawsuit against the Department of Labor's fiduciary rule in Texas (where the judge's questions suggest some possibility that the DoL could actually lose), a review of the other DoL rule implemented in 2016 that's at risk under President Trump (the safe harbor for states to create automatic enrollment IRAs without ERISA fiduciary exposure), and the big Advisor FinTech news that robo-advisor-for-advisors Vanare has raised a whopping $20M Series A round from ETF provider WisdomTree (and is being renamed AdvisorEngine in the process).

From there, we have a few technical articles, including a look at how variable withdrawal strategies can both improve average retirement income and reduce the risk of failure, how Medicare Part B premiums are changing next year (and what clients should consider, especially if they're just getting started in Medicare Part B this year or next), and planning strategies for Social Security for divorcees.

We also have several practice management articles this week, all focused on building out your advisory team, including: how to attract great team members by creating a Career Opportunities page on your website (even if you're not hiring right now); what your team members are looking for from the advisor-founder to be happy and successful (and better support the success of the firm); and the benefits of hiring a dedicated operations team member (or creating an entire dedicated ops department) for your advisory firm.

We wrap up with three interesting articles: the first is a preview of a chapter from Nassim Taleb's new book "Skin In The Game", about why salespeople must be separated from advisors, and how the ability of clients to sue (e.g., under a fiduciary rule) is actually a crucial mechanism to ensure advisors have reasonable "skin in the game" for their recommendations; the second is a review of the recent global OECD study on financial literacy, which finds that not only do consumers struggle with a wide range of irrational behavioral finance challenges, but also that more than half the world's adults are just sheerly financially illiterate; and the last is a great reminder of what it really takes to be sustainably successful as a business owner, and how it's not about just creating a great product or service, but also about being able to continually learn, empathize more, communicate better, try (and fail) more, and maintain a longer term view than any of your competitors.

And be certain to check out Bill Winterberg's "Bits & Bytes" video at the end, which this week includes coverage of the news that Wells Fargo is partnering with robo-advisor SigFig, a nasty two-day systems outage at Cetera (and the lessons in business continuity), and a FINRA announcement that Lincoln Financial is being fined a whopping $650,000 for failing to vet the security of a third-party technology vendor.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with several big news stories, including the first court decision of the lawsuits against the DoL fiduciary rule (with the ruling against NAFA and entirely in favor of the fiduciary rule!), an announcement that Morningstar is cutting its benchmark fees to zero for investment managers who want to benchmark against them (in an effort to compete more broadly in the world of index benchmarking), and the decision of John Hancock to stop selling traditional long-term care insurance policies to consumers (despite being one of the three biggest companies providing coverage!).

From there, we have several practice management articles, including a glimpse at how broker-dealers are looking to change grid payout systems in 2017 to comply with the recent DoL fiduciary FAQ, the risk of advisory firms acquiring multiple local advisors where the firm gets the cash flow but doesn't truly 'own' the client relationships (a serious problem when the parent firm wants to sell in the future!), and how advisors are increasingly struggling to differentiate themselves in a changing environment (and what they need to do about it).

We also have a few more technical planning articles, including: a fresh look at the tax policy proposals from President-Elect Trump and Speaker Ryan, which provides a glimpse into the kind of tax reform legislation we could see in early 2017; a discussion of how, despite the popular view that we may all live to age 120 and beyond, life expectancy has actually been declining slightly since 2010; and a look at the newly announced Medicare Part B premiums (up just 4% for those eligible for Hold Harmless, but up 10% for higher income individuals who don't qualify!).

We wrap up with three interesting articles: the first is a reminder that differentiating on service is a challenging way to build an advisory firm, given that everyone has a different (and evolving) view of what "good service" even means, and why it's better to build around relationships instead; the second is a look at what's called the "Goal Gradient Hypothesis", and the idea that we tend to work harder on a goal as we approach its end point (which suggests that clients may be more motivated by a series of short-term goals than one giant long-term goal like "retirement"); and the last is a good reminder from Bob Veres that even if the fiduciary rule does see a setback under President Trump and the Republicans, that in the long run the financial planning profession can still emerge victorious by continuing the "ground war" of winning over consumers to the virtues of a fiduciary advisors, one client at a time.

And in honor of Veteran's Day, be certain to check out the video at the end celebrating the delivery of pro bono financial planning for the military (and how it's being supported by the Foundation for Financial Planning)!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the big news announcement that risk tolerance software maker Riskalyze has raised a whopping $20 million Series A round to fuel its continued growth. Also in the news this week was the announcement that Morningstar has formally launched Analyst Ratings on ETFs (to complement its ratings on mutual funds), and that the latest data from the SEC shows it is still struggling to materially improve its examination rate of investment advisers, because the ranks of the RIA community are growing faster than the SEC's ability to scale up its exams!

From there, we have several practice management articles, including: the challenging "walls" that advisory firm owners must clear in order to transition from "small" solo practices into mid-sized businesses; why defining a niche is about more than just stating you work with a certain type of clientele, and instead is about explaining the unique outcomes you can create for those clients; and a look at how the latest DoL fiduciary FAQ could lead to cuts (or at least potential changes) to the typical broker-dealer grid payout system.

We also have a few more technical planning articles, from a look at how to help clients understand their longevity risk (and why typical life expectancy statistics understate their risk of outliving their money), to a discussion of the favorable tax rules for a personal residence (from the mortgage interest deduction to the capital gains exclusion), and why prenup agreements are becoming increasingly popular for young professional couples.

We wrap up with three interesting articles: the first looks at how the focus of financial planning is shifting from helping clients maximize their dollars and their Return On Investment (ROI), and instead is about helping clients live a better life with the dollars they have (improving their "Return On Life"); the second is a reminder that there's a fundamental difference between being a financial advisor salesperson and a client-centric professional (even if you're a salesperson who tries to do the right thing for clients); and the last is a powerful call to the financial planning profession that its time to step away from the broader financial services industry and find our own place in the world... at least, if the industry and its product manufacturers are willing to let go.

And be certain to check out Bill Winterberg's "Bits & Bytes" video at the end, which this week includes coverage of the latest Schwab technology roadmap, Riskalyze's $20M Series A funding, the announcement that SS&C (owner of Black Diamond) has acquired Salentica CRM, and TD Ameritrade's acquisition of Scottrade (including Scottrade Advisor Services) and the rollout of TDA's new "robo" solution Essential Portfolios!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with several big news announcements, including the release of the first Department of Labor "FAQ" about the fiduciary rule (a series of 34 common-question-and-answer responses about keep aspects of implementing the Best Interest Contract and Level Fee Fiduciary requirements), the announcement that Commonwealth is breaking ranks with other independent broker-dealers and opting to eliminate commissions from IRAs altogether (while Ameriprise and Raymond James announced they will be allowing commissions and implementing all the additional compliance processes necessary to adhere to the Best Interests Contract Exemption), and an indication from FINRA that it is working on new regulatory guidance regarding social media intended to make it easier for brokers to use the platforms with less burdensome compliance going forward.

From there, we have several practice management articles including: a look at the situations where a financial advisor might want to merge their advisory firm into another (rather than simply be acquired); the long-term trade-offs to consider when building a "lifestyle practice" as a financial advisor (particularly if you're still in your 30s or 40s); and a look at how one mega-RIA built a new specialty niche inside the existing RIA without disrupting the existing business (in this case, by rolling out an impact investing solution).

We also have a few more retirement planning articles, from a look at the existing proposals to resolve the projected Social Security shortfall in 2034 (where the levers to adjust to solve it are actually easy to determine, and the only challenge is deciding which ones to pull on to shore up the future cash flow obligations), to a discussion of the mechanics of the "pro rata" rule from IRAs and why it matters (particularly for backdoor Roth contributions), and an examination of the "tenure" option in a reverse mortgage and in what situations it may be a superior "lifetime" income alternative to an immediate annuity.

We wrap up with three interesting articles: the first is a look at how accumulating significant wealth, especially suddenly, can actually be very disruptive socially, often leading the newly wealthy to become surprisingly isolated socially (in part to defend themselves from people who try to attach themselves socially to be a part of the financial gain); the second is an examination of how the dynamic between financial planning academics and practitioners needs to change and improve to bridge the research/practice gap in financial planning; and the last is an incredible anecdotal story to help remind us all that customer/client service interactions that we may repeat over and over, day after day, may be a small part of what we do, but are 100% of the client experience for that particular client... which is why every single moment in the delivery of the client experience really matters.

And be certain to check out Bill Winterberg's "Bits & Bytes" video at the end, which this week includes an interview directly from Schwab IMPACT with VP of Advisor Technology Solutions, Brian Shenson, about the upcoming Schwab technology roadmap, from OpenView Integrated Office and Gateway enhancements, to an update on the OpenView MarketPlace, and the timeline for the new Schwab Portfolio Connect (the replacement for Portfolio Center) to be released in phases throughout 2017 and 2018!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the announcement that more than 50% of all Vanguard's growth is now coming not from its 'traditional' direct-to-consumer retail investor but instead from financial advisors, who now have as much with Vanguard as all individual investors in the aggregate (about $1.3 trillion)... a trend that will likely only continue, or even accelerate, as the DoL fiduciary rule rolls out in 2017.

From there, we have several articles on technology solutions for advisors, including: the announcement of Fidelity's new "robo-advisor-for-advisors" solution Fidelity Automated Managed Platform (which will deeply integrated with eMoney Advisor); the latest technology roadmaps at major broker-dealers Commonwealth, Raymond James, LPL, and Lincoln Financial; a review of the digital marketing tool Vestorly; and an interesting profile of the growing number of financial-advisors-turned-tech-entrepreneurs who are creating tech solutions for advisors by solving problems in their own advisory firms and then making the software available to others (sometimes building sizable tech companies in the process).

We also have a few more practice management articles this week, from a review of the latest FA Insight advisory benchmarking study on how the best advisory firms are outperforming on growth and profits, to a good reminder of how important it is to engage employees (and how expensive it is to turn them over), a discussion of key points to consider before breaking away from a broker-dealer to form your own independent RIA, and a reminder of how even a successful advisory firm sale by a founder can be extremely stressful and trigger a lot of soul searching.

We wrap up with three interesting articles: the first is a look at recent research on longevity, which suggests that despite improving life expectancies, we really may not even live much beyond 115 years of age, which appears to be the maximum lifespan based on our underlying biology (and medical advances may simply help us all to get close to age 115 before we die, not extend us past that point); the second examines how despite the tremendous growth of the tech sector, which now comprise most of the largest companies on the US stock exchanges, total employment of the tech sector is actually down over the past 15 years, as are the number of new tech startups, suggesting that perhaps the potential of technology is much more nuanced than previously believed; and the last is a challenging discussion about whether the focus of financial planning on helping clients achieve goals is wrong, because the truth is that most people don't have or even know what their goals are in the first place, and that perhaps our real value is to help clients figure out what goals they want to set and pursue.

And be certain to check out Bill Winterberg's "Bits & Bytes" video at the end, which this week includes cybersecurity tips for advisors from Kevin Mitnick ("World's Most Famous Hacker"), the launch of the new Fidelity Automated Managed Platform (AMP) for advisors, and the latest growth trends in performance reporting software solutions (from new features at Tamarac, to Orion landing a deal with mega-RIA Buckingham/BAM Alliance, and Addepar surpassing $500B of AUM and opening up a new API on its platform)!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with two interesting studies on advisor trends: the first finds that advisors who outsource investment management are growing substantially larger businesses than those who continue to manage investments in house, and that the result appears to be driven primarily by the direct time constraints that occur when the owner-advisor spends time on portfolio construction instead of meeting with prospects and clients and doing business development; and the second study finds that social media adoption amongst financial advisors is now widespread, with a growing number reporting a material amount of new business development stemming directly from their digital marketing efforts.

From there, we have several articles on practice management and career development, including: a look at how most advisory firms aren't even tracking the volume of new client leads coming in, making it impossible to evaluate whether they're doing a good job with their marketing and sales processes; strategies on how to reach out and develop deeper relationships with Centers of Influence (COIs) to generate referrals; issues to consider when deciding whether it's time to hire another financial planner in the office; and the most common leadership mistakes that financial advisors make in growing firms (all of which are related to the "thinking mistakes" we unwittingly unleash upon ourselves with our own mental attitudes).

We also have a few more technical articles this week, from key talking points with clients about the new money market fund rules that have just taken effect, to the way you can get a 3.5% yield on a government bond (by buying Series EE Savings Bonds!), and tips for finding an alternative to a big national bank if you've decided its time for something different (especially given the recent controversial news about Wells Fargo).

We wrap up with three interesting articles: the first is a fascinating introspective look from Stephanie Bogan, a consultant to advisors who built up a successful business and sold it for seven figures while she was still in her mid-30s, and reflects on how important it is not to confuse achievement and business success with truly finding your passion and purpose; the second is a fantastic reminder from Julie Littlechild of the importance of taking time off to renew, supported by her own research that finds the advisors who are most effectively engaged in their businesses really do tend to be the ones that take the most time off from the business as well; and the last is a discussion of a recent research study finding that the whole concept of "work-life balance" may be the wrong way to view the issue, as it implies a painful zero-sum trade-off, and that pursuing "work-life harmony" is a better way to approach the competing demands of business and life/family.

And be certain to check out Bill Winterberg's "Bits & Bytes" video at the end, which this week includes coverage of a financial advisor who got fired after falling for a cyberthief's "spoofing" attack (where the advisor accidentally processed fake email wire transfer requests), the news that Envestnet has acquired Wheelhouse Analytics (likely in preparation for DoL fiduciary price benchmarking), and the announcement of two new robo-advisor platforms, from Zacks Investment Management (which launched Zacks Advantage) to Merrill Lynch and its new Merrill Edge Guided Investing solution.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the huge news that Merrill Lynch is fully pivoting its retirement advisors to become level fee fiduciaries, eschewing commission-based retirement accounts entirely by April of 2017, and redirecting self-directed investors who still wish to trade to its Merrill Edge online brokerage platform or a new "robo" platform called Merrill Edge Guided Investing (though notably Merrill Lynch taxable brokerage accounts may still remain commission-based and are not subject to the new fiduciary rules). Also in the news this week was a decision from the DC Court of Appeals that has made a final ruling in favor of the CFP Board over the Camardas, which should end the ongoing lawsuit once and for all... and with the CFP Board's recent change to require mandatory arbitration, will likely be the last dispute any CFP certificant ever has with the organization that sees the inside of a courtroom.

From there, we have a few practice management articles specifically on the topic of hiring and retention, including: tips for hiring and retaining Millennial advisors; how to find the "right" team members by focusing first on cultural fit and passion (as long as the minimum technical skills are there); the importance of managing expectations for new employees to retain them going forward; and how "client-centric" firms aiming for high retention may be too client-centric, driving away their best employees (and ultimately damaging the firm's retention) in the process.

We also have several more technical articles, from a look at how to set "retirement guardrails" to determine when retirees may be spending too much (due to higher spending or poor market returns), to a discussion of how the community property rules interact with retirement accounts (and how a spouse's community property interest doesn't automatically ensure he/she can do a spousal rollover after death!), and an overview of how to use the IRS' Data Retrieval Tool (DRT) now that the 2017 FAFSA season is open.

We wrap up with three interesting articles: the first is a call-to-action for younger planners that despite being the "next generation" of financial planners, the time to lead is now (allowing for more time to build a foundation and enjoy the fruits of their labor!); the second is a look at the idea of practicing "radical generosity", giving especially deep and thoughtful gifts to clients, prospects, and referral sources, as a way to enhance the relationship; and the last is a look at how despite all the ongoing technological progress, the next 20 years may actually be far less disruptive than the past decades have been, as even "innovative" technology in recent years has actually been more incremental than truly revolutionary, and could actually drive consumers even more towards health care, education, and financial advising sectors, that remain uniquely human in their needs.

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