Archives Of Weekend Reading For Financial Planners

Enjoy the current installment of "weekend reading for financial planners" - big news in this week's edition is that the Department of Labor has released the latest update to its proposed fiduciary rule, which would expand the scope of ERISA fiduciary rules to IRA rollovers and require advisors (including brokers acting as such) to act in the best interests of their clients, but does not necessarily limit the nature of the compensation those advisors can receive and permits commissions to continue as long as they are paid pursuant to implementing best-interest advice. Perhaps not surprisingly, fiduciary advocates are saying the new rules may be too weak, while the brokerage industry is already objecting the new rules would be too stringent.

From there, we have a number of technical planning articles this week, including a look at the latest rules for income-based repayment (IBR) and public service loan forgiveness (PSLF) options for those with significant (Federally-based) student loan debt, a look at the new once-per-year IRA rollover rules that took effect at the beginning of January, a review of the Windfall Elimination Provision (WEP) rules that can reduce Social Security benefits for those who receive a pension based on "non-covered" earnings (i.e., wages not taxed under the Social Security FICA system), and some of the compliance and practical issues that advisors must consider as clients age and potentially face cognitive decline and diminished (financial and other) mental capacity.

We also have a couple of technology-related articles, including a look at Orion Advisor Services and some of its recent initiatives, a discussion of the latest research on cybersecurity risks in financial services and how safe client assets really are, and a broader overview of the major trends currently underway in technology providers for financial advisors (from M&A activity to an explosion of robo-advisor-for-advisors solutions).

We wrap up with three interesting articles: the first looks at some recent market research on how advisors advertise their services, suggesting that the "traditional" views like lighthouses and walks on the beach may feel nice and comforting to consumers, but are failing to differentiate advisors or generate much interest for consumers to explore further; the second is a somewhat amusing look at the "bubble in bubbles" as the "bubble" label is increasingly applied to everything from actual potential bubbles (which are rare) to anything that might just be overvalued or is even just a short-term fad; and the last is a look at how regardless of the ongoing potential for regulatory reform about the standards to which advisors are held, that perhaps the primary elephant in the room to address is simply the confusing ways that (genuine) advisors, insurance agents, and registered representatives all hold out to consumers as "advisors" instead of requiring them to use more accurate titles and labels to describe what they actually do.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including major new updates to the Grendel CRM the announcement by Schwab that its "robo-advisor" platform Schwab Intelligent Portfolios already has $500M of AUM, highlights of a recent review of Orion Advisor Services, and the LinkedIn acquisition of popular app Refresh.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the launch of a new "outsourcing" partnership between Fidelity and FirstPoint Financial (a subsidiary of Mariner Holdings), where advisors can refer clients below their asset minimums to be invested and receive financial planning advice... for which the advisor can be paid a referral/solicitor fee of 35bps.

From there, we have a few interesting investment articles this week, including: an in-depth look at the various ways to invest in an S&P 500 index fund and how not all mutual funds and ETFs are the same; a look at whether legendary value-investor Benjamin Graham would have been a supporter of index funds (hint: yes!); a discussion of how, after several years of poor performance, this may be a breakout year for actively managed US equity funds because the necessary three preconditions for them to excel are present (at least after the first quarter); and an overview of the rapid rise of "liquid alternatives" as the hot new asset class, even though the reality is that most are actually not a new asset class at all but merely an active manager trading existing asset classes!

We also have several practice management articles, from a look at using client advisory boards to gather better feedback from clients to improve your practice, to the idea of using a "positioning statement" to explain why your business is unique/different instead of an elevator speech, to ways to find and leverage interns in your practice, and a wide-ranging interview in the Journal of Financial Planning with Caleb Brown of New Planner Recruiting about the current state of hiring, career tracks, and new financial planners entering the industry.

We wrap up with three interesting articles: the first explores how over the past 15 years, the number of jobs doing routine work has been in steady decline as technology and automation take over, but job growth continues to be robust for non-routine jobs that can't be easily automated (a bullish sign for financial planners working directly with individual clients!); the second looks at how technology is not only changing the world of financial advice, but also the advice we give to clients, as in the coming years we may no longer need to own cars (thanks to self-driving cars) or spend much on college (thanks to disruption from MOOCs) and estate planning could become a 5-generation-affair if longevity increases continue; and the last looks at a study of some of the common characteristics of the most successful advisors, including their focus on not only business goals but also the development of the team that supports them.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with a recent industry benchmarking study, finding that not only are advisors enjoying record levels of productivity (as measured by assets and revenue), but the average AUM fee actually ticked slightly upwards last year, despite the explosion of media coverage about "robo-advisors" and the alleged fee/pricing pressure they would begin to put on traditional advisory firms.

From there, we have a few interesting investment articles this week, including a fascinating discussion of investment liquidity (and a warning against assuming that any ETF will remain liquid if its underlying investments are not), the first blog post by former Fed chairman Ben Bernanke about why he thinks interest rates remain low (hint: it's not Fed actions, but sluggish economic growth that the Fed is merely mirroring), a look at how the popular Shiller CAPE ratio can be adjusted for changing historical trends in dividend payout rates (although the conclusion is still that markets are expensive even after the CAPE is adjusted), and a look at how due to bad market timing even the average value investor (in a value mutual fund) fails to capture the value premium (which in turn suggests it won't be arbitraged away anytime soon!).

We also have several more technical articles this week, including: a look at how the concept of retirement is evolving as the rather-arbitrary "traditional" retirement age of 65 comes increasingly into question; a look at how to decipher financial aid letters and what to watch out for to determine if a student's aid package is really a "good deal" or not; new estate planning tips and strategies for clients who once were exposed to potential Federal estate tax but are no longer (due to higher exemption amounts); and a discussion of Deferred Income Annuity (DIA) products and how they can be superior to more traditional Single Premium Immediate Annuity (SPIA) solutions.

We wrap up with three interesting articles: the first looks at the rise of Zenefits, a "robo-broker" in the employee benefits world that really does appear to be disrupting the status quo, though it is actually building its business with a strong technology component overlaid on top of human brokers who still consult directly with clients; the second looks at how the explosion of smart beta ETFs is also a trend of increasing robo-advised investment management as the majority of smart beta funds are implemented using computer algorithms; and the last is a lighter look at how to nail an email introduction in a world where most people are increasingly bombarded by a high volume of email.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including the announcement by Schwab that its "robo-advisor" platform Schwab Intelligent Portfolios already has $500M of AUM, highlights of a recent review of Orion Advisor Services, and the LinkedIn acquisition of popular app Refresh.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the big announcement that traditional insurer Northwestern Mutual has bought out "robo-advisor" LearnVest for a sum reported to be more than $250M in cash, though it's not entirely clear whether Northwestern is looking to grow and adapt LearnVest's fee-only financial planning business model, or simply adopt LearnVest's unique technology, including a consumer Personal Financial Management (PFM) app and financial planning software, internally for Northwestern's own agents and brokers. Also in the news this week were new details about Schwab's Institutional Intelligent Portfolios, its "robo-advisor-for-advisors" offering that appears to have more flexibility than the direct-to-consumer solution, but will still entail some indirect and possibly direct costs for advisors and their clients.

From there, we have a number of additional technology-related articles this week, from a discussion of why it's important to "own" and not "lease" your website from a packaged template provider, to a review of the latest "3.0" edition of the FinaMetrica risk tolerance software, to a review of the latest in rebalancing software tools, and also a discussion of some important caveats and exclusions to be aware of when considering cybersecurity insurance for your advisory firm.

We also have several more technical articles this week, including: recent new research into how retirees spend on health care as they age, showing that medical expenses are actually far more stable than most believe (but long-term care remains a big wildcard); a discussion of sequence of return risk and what it really means; and a look at how, even in times of volatility, only a portion of a diversified portfolio is really at risk for retirees, which has implications for both how funds should be invested in retirement, and how to manage that risk with dynamic spending policies.

We wrap up with three interesting articles: the first looks at the rising trend of RIA custodial platforms moving into more and more direct competitor with the independent RIAs they serve (from growing their own wealth management offerings to giving consumers money-back guarantees that independent RIAs can't match); the second is a review of the ways that broker-dealers make money off their own advisors, in both transparent and not-so-transparent ways; and the last is a discussion of how the nature of client review meetings is evolving, as information that once had to be discussed in a meeting can now be easily accessed from a smartphone, raising interesting questions of just how often it's really necessary to meet with clients in person and what role shorter virtual meetings could play in the process.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including his own discussion of the new Schwab Institutional Intelligent Portfolios for advisors, and the Northwestern Mutual acquisition of LearnVest.

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the big announcement from SEC chairwoman Mary Jo White that she intends to have the SEC push forward on a uniform fiduciary standard for brokers and investment advisers, nearly 5 years after Dodd-Frank legislation originally authorized the SEC to do so. Of course, the devil remains in the details of what will or will not come forth as the SEC begins its own prospective rulemaking process in the coming months and years.

From there, we have a number of practice management articles this week, including a look from Investment News at how some of the largest ($1B+ AUM) advisory firms seem to be getting more profitable and successful (and growing even faster) as they get larger, a discussion of how increasingly advisory firm owners are attending conferences not for educational content but as an opportunity to network for advisor recruiting, and the issues to consider when deciding whether or not to adopt account aggregation software in your practice.

We also have several more technical articles this week, from an interview with economics professor Laurence Kotlikoff on his new Social Security planning book "Get What's Yours", to a discussion of how long-term care insurance may change as premiums continue to rise and emerging studies find that consumers are more likely to need long-term care than previously thought but the typical duration of claims is actually far shorter than once believed (averaging less than 1 year for men and under 1.5 years for women), and what clients should consider if they're not going to buy long-term care insurance and need to come up with their own plan. There are also two investment articles this week - the first is an look from Bob Veres at how advisors are preparing for the potential "bondmageddon" in the coming years, and the second is a research paper from GMO about how pension funds should manage "valuation risk" by dynamically adjusting equity exposure over time (a strategy that can help individual retirement planning as well!).

We wrap up with three interesting articles: the first is a profile of Luke Landes, who built the Consumerism Commentary personal finance blog into a seven-figure business over the span of a decade; the second is a look at how most people who feel they aren't productive enough are really just struggling with the fact that they're so overcommitted they couldn't possibly do everything they've set forth for themselves (there just aren't enough hours in the day!); and the last is a series of "lifehacks" and tips to manage your own personal efficiency, from how to better handle the never-ending flow of email, to maximizing your productivity by focusing on one task at a time for 25 minutes each.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including a review of this week's Nerd's Eye View article on how to choose technology and start a new RIA on a budget, to the newest "second opinion" tool for consumers from SigFig, and more!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with a review of the latest SEC and FINRA guidance on top areas of concern regarding their oversight of advisors, from cybersecurity to how advisors oversee multi-advisor firms to increased scrutiny on retirement rollovers and advisors with multiple fee schedules (and how clients end out in one versus another).

From there, we have a long list of practice management articles this week, including: a discussion of valuing practices based on a multiple of (discounted) cash flow rather than just a multiple of revenues; whether the recent shift of United Capital from acquisitions to tuck-ins signifies a potential slowdown in advisor mergers and acquisitions; how "acquisition" succession planning is typically structured and implemented in wirehouses; what wirehouse advisors should consider (especially about mundane but important arrangements like office space) if they're planning to break away and go independent; a reminder that clients care less about what you do than why you do it; how clarity about where a business is heading in the long run can help to get staff to stay focused on what they should be working on; the long-term growth problems that emerge for advisors who create an "anti-selling" culture; and a discussion of why, even though it can sting, getting "fired" by a client can be a good thing if the reality was that you weren't really a fit for their needs anymore anyway.

We wrap up with three interesting articles: the first is a discussion by financial life planner Mitch Anthony about how we can help clients "add life to their years" by helping them to consider encore careers rather than just an all-or-none retirement transition; the second is an interview with advisor-to-advisors legend Nick Murray as he shares his wisdom about how to be successful as an advisor; and the last is a discussion of the recent launch of the Schwab Intelligent Portfolios solution and whether Schwab has lost the focus on its core values given the swirling discussions of the conflicts of interest around its "free" solution and its potentially significant (and more-profitable-to-Schwab) cash allocations.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including a discussion of the Charles Schwab and Wealthfront fight, Fidelity's Apple Watch app, and a discussion of how advisors can use screencasting tools like Camtasia!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with coverage of the recent SEC and FINRA cybersecurity "sweeps" of advisor best practices, which finds that RIAs have been more lax in their cybersecurity policies and managing than broker-dealers, although notably a higher percentage of broker-dealers have actually suffered fraudulent loss events (though the reasons are unclear). Also in the news this week was a warning that Genworth anticipates yet another bad quarter of financial results due to continued losses on its long-term care insurance, which has now driven the company's stock price down by more than 50% over the past year and led to its debt rating being downgraded to "junk" status.

From there, we have several marketing-related articles this week, from a discussion of the various types of tools/platforms available for advisors who want to blog, to tips in building a "virtual" client webinar event to gather prospects, to a look at how advisors should focus on building "social capital" to grow their firms, and a study of "elite" advisors suggesting that the best advisors spend upwards of 4% of revenues on marketing (compared to only 1%-2% for "typical" advisory firms).

We also have a few retirement-related articles, including one that raises the question of whether more advisors should recommend retirement income solutions with "guarantees" because the cost is a worthwhile trade-off to the client for peace-of-mind (even if it results in less expected wealth and isn't justified "mathematically"), a second that looks at the trade-offs to consider in lump sum versus pension decisions, and a third looking at how variable withdrawal rate strategies may "dominate" fixed withdrawal rate strategies... although it depends on how you define "success" in the first place.

We wrap up with three interesting articles: the first is an open letter from Bob Veres to SEC Chairwoman Mary Jo White, questioning why the SEC really needs to increase RIA exams at all, whether the process is outdated, and why the SEC's staff is allowed to be so inefficient with each examiner averaging of only 2.2 RIA audits per year; the second is an interesting look at how the culture is changing in wirehouse firms since the financial crisis, and whether their outflows of breakaway advisors have less to do with shifting commission-versus-fee business models and more to do with current management undermining the entrepreneurial partnership culture that built those firms in the first place; and the last provides a look at the emerging rise of the Financial Therapy Association and a new body of research that looks at our physiological and psychological responses to money issues and how to better help clients work through them.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including the announcements that robo-advisor Wealthfront has crossed $2B of AUM, ByAllAccounts has crossed $1T of account aggregation, and a review of Morningstar's new iPad app!

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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 President Obama's public endorsement of the Department of Labor's looming fiduciary proposal, Envestnet's acquisition of robo-advisor-for-advisors platform Upside Advisor barely more than a year into its existence, and the decision of Fidelity to merge its broker-dealer and RIA custodian clearing units into one while also creating a new Fidelity Wealth Technologies division to push forward the company's increasing focus on next generation technology.

From there, we have several investment-related articles this week, from the emerging "existential" crisis for indexing (and whether non-cap-weighting indices like fundamental indexing represent true "indexing" at all), to whether rebalancing really does increase returns or not, to the opportunities of "local investing". There are also discussion of the surging popularity of cash balance pension plans for high-income professionals and small business owners, a nice "lessons learned" article about the world of investment management, and an interesting look at whether owning long-term Treasury bonds might still make sense even at today's low rates (think: defending against deflation risk that could take rates even lower from here).

We wrap up with three interesting articles: the first is a look at the life of 109-year-old Irving Kahn, an investment adviser who started in the business in 1928, profited by shorting stocks in the crash of 1929, and ultimately went on to become a deep value investor after working as a research assistant directly under investing legend Benjamin Graham; the second article is a discussion of how parents should properly set allowances for children, suggesting that most parents do not give children nearly enough responsibility with money early on when it can be best used to teach important lessons about values; and the last is a look at how the "Uberization" of work could lead to an entirely new era of how we find employment and earn money, that may allow for more flexible work than ever, but also lead to a significant decline in the stability and security of employment, with profound ramifications for how we give career, earnings, and saving advice to young people today.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including the Envestnet acquisition of Upside Advisor, the "Superfish" vulnerability on Lenovo laptops, and a new integration from mobile dictation service Mobile Assistant!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with two big news announcements, including a new $60M round of venture capital for robo-advisor Betterment that will be used in part to build out its robo-advisor-for-advisors solution Betterment Institutional (with a reported 90 RIAs already using the platform), and a detailed review of Form ADV for the new Schwab Intelligent Portfolios "robo" solution as well that reveals the platform will only be "free" because its 30bps management fee will be covered by the profits Schwab makes on its underlying ETF and bank offerings (including a 7%-30% cash allocation in all portfolios!).

From there, we have several practice management articles this week, including a look at how doing financial planning for Millennials means retooling the advisor's services (and business model?) away from AUM-centric retirement accumulations and towards building "financial independence" instead, an interview with "Reformed Broker" and financial advisor Josh Brown as he approaches 100,000 Twitter follows about how his blog and social media presence helped to build a $170M AUM practice, a look at the importance of effective branding and communications for advisors, and some tips on how to publish an "e-book" to establish your credibility.

We also have a few technology-related articles, from a look at how to better "personalize" and humanize the ways you use technology with your clients, to software reviews for the latest Tamarac iPad app and the newest release of eMoney Advisor's financial planning software (dubbed "EMX").

We wrap up with three interesting articles: the first is a letter from CFP Board chair Richard Rojeck as the organization celebrates its 30-year anniversary, looking back at what has been accomplished and where the CFP Board still sees opportunity from here; the second is a review of the recent new book "The Incredible Shrinking Alpha" by Larry Swedroe looking at how the competition for alpha is fiercer than ever (which makes less and less of it available to capture); and the last is a great reminder that helping clients through the stressful times can be stressful for the advisor as well, so now - while markets are relatively calm - might be a good time to take a "reboot", and make sure you're fresh for when the next inevitable bear market finally comes.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including highlights of the Technology Tools for Today (T3) conference, a review of the news that Betterment has raised another $60M of venture capital (in part to support its new service for advisors, but also to expand its capabilities to answer basic financial planning questions), and more!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the latest big acquisition news, as a private equity firm acquires portfolio accounting and reporting solution Orion Advisor Services, marking the last of the major RIA portfolio accounting platforms that have been acquired (after last week's Advent acquisition). And notably, the deal caps a series of massive Advisor FinTech acquisitions that dramatically trump all the dollars that have ever been invested into "robo-advisors", suggesting that the big money sees even more opportunity in serving advisors in the long run (rather than competing with them!). Although also in the news this week were some further details from the looming Schwab "robo-advisor" solution, which the company announced is targeting a whopping $400 billion of AUM through both its retail and advisor channels!

From there, we have several practice management articles this week, including a look at how advisory firms with strategic plans fleshed out to the point of having actionable implementation steps are outpacing the growth of firms without a strategic plan (or with one lacking the specificity to actually implement), how often the greatest challenge a firm's advisor-owner faces is the need to change his/her own perspective to move the business forward, and some tips on what to think about when crafting communication as an advisory firm (from what to include on your website for prospects, to how to work with the media effectively).

We also have several more technical articles, from a review of the some of the popular "cutting edge" estate planning strategies in use for higher net worth clientele who still face a Federal estate tax problem, to an in-depth look at all the different types of long-term care insurance (traditional LTC, hybrid coverage, etc.) and how to compare them and evaluate which is best and when, and a discussion of the problems with many of today's life expectancy calculators and what to consider if you decide to use one. There's also a discussion of retirement researcher Wade Pfau's new launch of the "Retirement Wealth Index" and the "Retirement Affordability Index", which are meant to give today's retirees some perspective on how good/bad of a time it is to retire.

We wrap up with three interesting articles: the first is a poignant reminder from advisor Ric Edelman that as both an advisory firm grows and changes, and the industry and environment changes around us as well, that whatever got us to where we are successfully is rarely what works to keep us moving forward from here; the second is a fascinating glimpse at a recent study suggesting that as self-driving cars become a reality in the coming decade, the need for vehicle ownership could drop by more than 40% (drastically reducing what clients need to budget, both for a car, and for that 2-car garage!); and the last is an interesting reminder that the whole central role that money plays in our lives today is actually a relatively "recent" phenomenon since World War II, and that in fact the rise of financial planning and its whole reason for being may ultimately boil down to helping us relate in a healthy way to money and the powerful role that it plays in our lives.

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