Archives Of Weekend Reading For Financial Planners

Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with an announcement that the CFP Board and Rick Kahler have reached a resolution regarding his publicly controversial "fee-only" situation, with the odd conclusion that Kahler can avoid declaring that he receives any commission compensation directly or through a related party by transferring his commission-based business to... his wife, who inexplicably is not being treated as a related party. Also in the news this week was an updated regulatory notice associated with the Department of Labor's fiduciary proposal, suggesting that the next draft is still on track for release in January.

From there, we have a number of practice management this week, including a discussion of how advisors might plan to adapt (in advance) to survive the next big market downturn, a look at how advisors can create a "shock plan" to plan in advance for potential shocks to the business, a guide for advisors looking to change broker-dealers about how to do it properly to maximize the retention of clients and minimize business disruptions (to the extent possible), and an interesting profile of an independent RIA Wetherby Asset Management that has grown to over $4B of AUM in just over 20 years with a whopping $10M client minimum yet even while nearly 75% of its staff are under the age of 40.

We also have a couple of technology articles this week, including a review of the new financial planning software Advizr, a look at some advisor technology tools being adopted on mobile devices, and a (favorable) early look at the major client portal overhaul coming for the Black Diamond portfolio performance reporting software.

We wrap up with three interesting articles: the first is a detailed look from the RIA's perspective at the recent Barrons cover story on Schwab CEO Walt Bettinger that suggests the company is still conflicted about the fact that it is simultaneously the largest independent RIA custodian and also a massive consumer retail brand; the second looks at client trust, and makes the interesting point that just because clients do business with an advisor doesn't mean they fully trust the advisor (which may explain why the clients still have other outside advisors, and are not referring despite saying they are "happy" clients); and the last explores how the amount of available alpha in the investment markets may be shrinking, despite the fact that active managers have more tools and resources that ever at their disposal, because paradoxically the higher the average skill level of all active managers, the harder it is for any one of them to materially outperform.

Enjoy the reading, and Happy Thanksgiving!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with coverage of the newly shortened computer-based CFP exam that was administered for the first time this week, and also an announcement by the CFP Board in its recent business webinar that the public awareness campaign, and the additional $145/year fee that funds it, is expected to continue "indefinitely" (as long as the campaign results continue to be positive). In addition, the FPA also released this week a new study about advisors and growth, finding that advisory firms are struggling to achieved their growth goals, with only 9% of all firms reporting that their business development efforts are "very effective" in achieving their goals.

From there, we have a number of technical articles this week, including: a discussion of the current status on Social Security benefits for same-sex married couples; how early retirees can maximize premium assistance tax credits for getting health insurance during the "gap" years from retirement until Medicare eligibility; some key details to know about how non-transparent "active" ETFs will work; a discussion of what kinds of assumptions are (and are not) reasonable when clients are pitched on equity-indexed universal life strategies; a new court case in Pennsylvania on "filial support" that raises the question of whether long-term care facilities may become more aggressive in pursuing adult children for the unpaid expenses of their indigent elderly parents; and a summary of the current state of dependent care accounts, and the opportunities they provide, even though they are not often utilized.

We wrap up with three interesting articles: the first provides a good overview of some of the latest research on whether money really can buy happiness or not (hint: it's not just about having wealth, but about how it is spent); the second explores some new research on the behavioral biases that impact not only investors, but also advisors and even fund managers; and the last is a (not entirely positive) review of the recent Tony Robbins book that finds the book may not have as clear of a fiduciary message in practice as it purports in theory.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including the launch of a new financial planning software solution called Advizr, a new "robo-planning" solution iQuantifi, and more! Enjoy the reading!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with a recent interview with the CFP Board where it reiterated its focus on growing the number of CFP certificants (as there are still more CFP professionals over the age of 70 than under the age of 30!), but also that the organization is committed to not lowering its standards in the process of pursuing growth. Also in the news this week are some highlight articles of the recent T3 Enterprise conference for advisor technology in large firms (which included some new product launches relevant for independent advisors, too).

From there, we have a few practice management articles this week, including an interesting look from the latest FA Insight benchmarking study showing how the challenges that advisory firms face are quite different depending on the size of the firm (reinforcing the notion that what got the firm to where it is may not move it forward from there), a discussion from Philip Palaveev about what advisors should be thinking about when they consider whether to merge with another advisor and form an ensemble firm (or not), a profile of some advisor study groups and their value (even and especially for firms that are already growing), and a discussion of how financial planning software is starting to change to allow planning to be done quicker and faster.

We also have several more technical articles, from a new study showing that long-term care needs may be more frequent but much shorter duration than typically thought (which raises the question of whether today's long-term care insurance is the right type of coverage), to a discussion of IRS Announcement 2014-32 which discusses transition rules to the new once-per-year IRA rollover rules taking effect in 2015, and a look at the new Society of Actuaries 2014 Mortality Table that could impact everything from more favorable RMD calculations for retirement accounts to making lump sum pension rollovers more valuable for those who wait a few more years.

We wrap up with three interesting articles: the first looks at how once you include the volatility of career earnings for Millennails and the relative stability of Social Security and pension income for Baby Boomers, the reality may be that the ideal portfolio should actually be quite similar for young adults and retirees; the second discusses how it's not enough for advisors to have clients who are "satisfied" but that ideally clients should be "engaged", which requires advisors to adjust from thinking about what they offer to clients and instead consider what they can create with clients instead; and the last looks at how it can actually be a good business idea to wear the same kind of outfit every day (and yes, it will give you insight into why I always wear a blue shirt!).

And also be certain to check out the videos at the end from Bill Winterberg, highlighting some of the news and buzz from this week's T3 Enterprise advisor technology conference! Enjoy the reading!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with an article highlighting the recent dispute between the CFP Board and (former) CFP certificant Nigel Taylor, who surrendered his CFP certification after an allegation that his firm was in violation of the "fee-only" compensation disclosure rules... and has, in the process, highlighted a critical concern regarding whether the CFP Board has the same scope to enforce its compensation disclosure rules against a firm in the way it does against individual CFP certificants.

From there, we have a large number of practice management and career development articles this week, including: how the effort that potential employees put into the process of applying for a job with you may be more important than their resume and background and experience in the hiring decision; a pair of articles that provide suggestions and tips on how to hire (young) advisors, and build a process around doing so; how advisory firms must learn to shift from focusing on rainmakers to grow and instead adopt firm-wide marketing strategies that allow everyone to participate and support the growth process; tips for young advisors who find themselves rising in their firms and becoming a Millennial manager for the first time; a look at how many young advisors are adopting a "career portfolio" by diversifying income streams across multiple business and freelance endeavors; suggestions on how to evaluate whether your client service team is actually doing a good job servicing clients; and a look at how different "mercenary or missionary" cultures in advisory firms can impact their growth and success over time.

We wrap up with three interesting articles: the first looks at how the financial blogger conference FinCon may be a good template for how advisor conferences need to change to gain better engagement and attendance from young planners; the second look at why it is so difficult to get new clients to make a change to a new advisor, and how the biggest key to success may not be about better communicating your value (although that matters too!) but simply showing them how you will make the process of change itself as easy and hassle-free as possible; and the last provides an interesting reminder that while it's important to be conservative in helping clients to their financial goals, planners should be cautious not to superimpose their own risk and concerns as planners onto their clients' lives, or the advisor risks causing the client to leave a large inheritance but fail to enjoy their wealth with the time they had to enjoy it!

And also be certain to check out the videos at the end from Bill Winterberg, highlighting some of the news and buzz from this week's Schwab IMPACT conference! Enjoy the reading!

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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 Charles Schwab is entering the "robo-advisor" fray, with an offering called "Schwab Intelligent Portfolios" that will be available for consumers (and shortly thereafter as a white-labeled version for RIAs on the Schwab platform), and will be free to use with only a $5,000 minimum (and automated tax-loss harvesting starting at $50,000).

From there, we have a number of practice management and technology articles this week, including a discussion of what to look for when merging smaller advisory practices into your own firm (from the perspective of someone who's done several such deals, both successful and not), tips for advisors who want to get "cyber liability" insurance to protect against the risk of cyber attacks and wire fraud, guidance on how to form a client advisory board, and a look at how an online chat tool on your website can help engage visitors and turn them into genuine client prospects.

We also have a few more technical articles this week, from a Morningstar analysis of the rise of passive investing that finds predictions that consumers are abandoning active management for low-cost indexing may be overstated, to a look at why it's so significant that the Treasury and IRS gave the green light to deferred income annuities inside target-date funds, an analysis of consumer borrowing options that find borrowing from a 401(k) loan may be quite underrated (at least relative to the other borrowing options typically available to consumers), and a good summary of basic strategies and resources to families who haven't saved enough (or anything) for college and are now trying to figure out what to do as the kids prepare to apply.

We wrap up with three interesting articles: the first looks at how not only do many advisors have a problem branding themselves, but that the entire financial planning profession has a "branding problem" due to a lack of clear vision about its fundamental role and purpose in society; the second is a critique by GMO's James Montier of the whole concept of managing companies by trying to "maximize shareholder value" and how the incentives that have been created are actually damaging (long-term) shareholder value; and the last is a fascinating look at how too much positive thinking can actually be damaging to achieving goals, and that balancing optimism with realism is crucial to obtain the motivation necessary to pursue the goal... which has some notable implications for how we as financial planners guide our clients towards retirement! Enjoy the reading!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with a new study from the Financial Planning Coalition that finds barely 1/3rd of those advisors who hold themselves out as "financial planners" are actually doing financial planning, and that therefore regulators need to be more proactive in overseeing financial planners and how they hold out to the public to reduce the confusion. Also included in this week's news was a study from Cerulli Associates which finds that while the wirehouses have taken criticism for focusing on high net worth clientele, they really are providing the most comprehensive range of services to those HNW clients, beyond advisors at independent broker-dealers or RIAs.

From there, we have a number of practice management and technology articles this week, including a look at what advisors need to consider when adopting "e-signatures" for clients who want to sign documents electronically, a fascinating look at the challenges that large RIAs (e.g., $1B+) are facing in their efforts to grow to $5B and beyond (and what they need to do to take the next step), a review of the latest release of Redtail CRM, and a discussion of how InStream Solutions is transforming financial planning software from just a tool to analyze client situations to a firmwide tool to manage and oversee what advisors are recommending across all their clients.

We also have a few more technical articles this week, from a review of what "collaborative divorce" is all about and why divorcing clients should consider it (and also how advisors can actually do work as a "financial neutral" in a collaborative divorce specialist!), a study looking at how retirees spend their time in retirement (finding that most of their time is spent doing inexpensive leisure activities, and household activities that could actually reduce their cost of living in retirement!), and a great discussion of how young adults have so much job instability that perhaps they should be invested in an especially conservative manner with their portfolios and not aggressively as the conventional wisdom suggests.

We wrap up with three interesting articles: the first looks at the rising number of CPAs entering financial planning, and whether they could help fill the dearth of young talent in the profession; the second examines the latest benchmarking studies for financial advisors, and suggests that advisors may be too complacent about the potential impact the next bear market could have (and that they're underestimating how reliant they've become on market growth to sustain their current growth rates); and the last looks at how even though all the buzz of the industry is about the threat of "robo-advisors" that the real trend that is currently underway has been the rise of "phono-advisors" - mega financial services firms delivered financial planning through call centers that already have more than 100(!) times the AUM of today's robo-advisor platforms!

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including a recently announced Microsoft vulnerability (don't open any suspicious emails with Powerpoint presentations attached!), and a look at advisor tech consulting firms now offering cybersecurity audits for advisors to identify any risks to client data! Enjoy the reading!

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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 the "robo-advisor" Betterment has launched an Institutional platform that will partner with Fidelity to offer a "robo" solution for advisors to use with their (smaller) clients.

From there, we have a number of practice management articles this week, including a look at new compensation models being explored by advisors who are looking to get away from the AUM model (or serving clients who simply don't have the assets to work on an AUM basis in the first place), examinations from two recent benchmarking studies about what top performing firms do that are different than the rest of the pack (including differentiating themselves with niches and specialization to support their pricing, and using "non-professional" support staff to enhance the productivity of their lead advisors), and an interesting article by Bob Veres looking at the wide range of changes being recommended to advisors and sharing his own take about what is and is not really important for advisors to focus on right now.

We also have a few more technical articles this week, from a review of target-date funds finding that many are becoming increasingly aggressive and equity-centric in the current low bond yield environment (with one fund as high as 94% in equities for someone in their 40s!), to an interesting profile of economic and retirement policy researcher Jeffrey Brown (who may not be familiar to most advisors but probably should be!), to an interview with Nobel price winner Bill Sharpe who has been increasingly focusing his current research time on the complex challenge of retirement planning. There's also an article looking at how, despite all the ongoing fears, health care inflation for seniors appears to be slowing, as the latest announcement of Medicare Part B premiums will be $104.90/month again for the third year in a row.

We wrap up with three interesting articles: the first is a comparison of popular risk tolerance tools FinaMetrica and Riskalyze, finding that one seems to be far better as a sales and prospecting tool for clients but the other may be more defensible in court; the second provides some tips on efficiency and productivity based on the latest research of behavioral finance expert Dan Ariely; and the last is a profile of venture capitalist and technology innovator Marc Andreesen, who created the first popular web browser and backed Twitter, Facebook, and AirBnB, and now sees opportunities for similar disruption in financial services (especially around how big banks charge for facilitating credit card and banking transactions, as "crypocurrencies" like Bitcoin gain momentum).

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including his take on the recent announcement that Betterment Institutional will partner with Fidelity, and how amidst the SEC's push for better cybersecurity with advisors they lost 200 of their own laptops with potential client data (oops!)! Enjoy the reading!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the latest in the ongoing saga of the CFP Board's compensation disclosure woes; the latest news is that another CFP certificant was accused of violating the fee-only rules by also owning an insurance company, but has avoided a CFP Board investigation by dropping his CFP marks, "resolving" the issue but raising questions about how this was even possible (as it violates the CFP Board's own Terms of Service to drop the CFP marks with a pending disciplinary issue) and potentially setting a dangerous precedent that encourages other CFP certificants to simply break the rules and then drop their marks if a complaint is ever filed so they can avoid any public discipline.

From there, we have a few practice management articles this week, including one article that looks at tactics firms are taking to attract talent given the shortage of young advisors coming into the business, another that reviews Fidelity's recent "Recruiting Redefined" study that finds the greatest challenge for bringing in talented young advisors may be the product-sales-centric focus of much of the industry and the fact that most college students aren't even aware of a potential career as a comprehensive financial planner, a third article that provides a good reminder of how establishing a succession plan with an existing staff member can avoid communications breakdowns that damage the firm, and a final article that explores how for firms that have focused on holistic advice and not "sales" the challenge now may be on to shift the firm's culture to promote more business development or face declining growth rates as the founders eventually wind down their own efforts.

We also have a few more technical articles this week, including a tale of woe from the tax court about how not do try to invest in real estate using your IRA, an article about the unique situations where it actually does make sense for a married couple to file tax returns separately and not jointly, a discussion of the importance of not just digital asset planning in general but especially for small businesses where digital assets can have significant value, and a nice retrospective look from the Journal of Financial Planning at the so-called "4% rule" as this month is the 20th anniversary of Bengen's seminal research article.

We wrap up with three interesting articles: the first looks at the rise of "prize-linked savings accounts" that pair together small savings accounts or CDs with a "bonus" lottery ticket for a small monthly prize to encourage savings behavior (as even if the person doesn't win, they still saved!); the second looks at the rise of patent trolls in the context of online financial planning and investment advisory tools and whether the "robo-advisors" may face a patent challenge; and the last discusses why a fiduciary standard is crucial to clean up the industry, as when standards are otherwise too low a few "bad actors" can actually drive away the good and legitimate businesses to the long-term detriment of consumers.

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 that Schwab may soon be rolling out a "robo-advisor" solution of its own (that would potentially be available to advisors using their platform!), a new digital estate planning assistance tool, and more. Enjoy the reading!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with some regulatory announcements, including ongoing efforts by FINRA to implement its "CARDS" analytical tool that would monitor investment activity in clients' accounts across the entire industry looking for inappropriate broker trades and recommendations, and a discussion of the potential paths the SEC may soon take to update the "accredited investor" definitions for the first time since 1982 (and raising the question of whether income and net worth are even appropriate measures to determine an accredited investor in the first place).

From there, we have a few practice management articles this week, including a prediction that the rise of the "mega-advisor" firm may soon present challenges for small independent advisors trying to compete, coverage of the recent buzz at the Deals and Dealmakers Summit that the amount of M&A activity in the industry may be 20X as much as widely reported, and a good discussion of what it really means for an advisory firm to have a true CEO (not just a founder who puts the title on their business card).

We also have a few more technical articles this week, from a New York regulator looking into whether Equity-Indexed Universal Life policies are being illustrated with unrealistically optimistic projections that aren't likely to come to fruition, to a good discussion of the events leading up to the departure of Bill Gross as advisors and clients across the country consider whether it's time to fire PIMCO from their portfolios, to an interesting discussion of the impact of time diversification and how it can legitimately lead clients to owning more equity exposure for the long run, and discussion of an emerging trend in long-term care insurance where carriers are increasingly asking about family history looking for clues about any potentially-genetically-inherited disease factors that would/should impact underwriting.

We wrap up with three interesting articles: the first looks at how to become a "super connector" as a means to build your network and advance your business/career; the second is a look at the "reverse mentoring" program being implemented with the executive committee at Pershing (and the benefits that come from getting a young, fresh perspective); and the last looks at how advisors interact with and communicate with clients, raising the challenging question of whether sometimes the biggest problem is not that clients won't act on advice, but that advisors need to learn better communication skills in how to deliver it in the first place.

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including announcement of a high-profile (human) advisor firm that's launching its own online "robo-advisor" solution, to a discussion of the upcoming release of a big new version of Redtail CRM, and more! Enjoy the reading!

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Enjoy the current installment of "weekend reading for financial planners" - this week's edition kicks off with the shocking announcement that Bill Gross is leaving PIMCO 41 years after founding it and taking over as the bond manager for the Janus Global Unconstrained Bond Fund, it what appears to have been a "voluntary" departure just days before PIMCO was going to fire him anyway for "increasingly erratic behavior" and threats from multiple PIMCO executives that Gross must be fired or they would leave instead.

In further notable news this week, the SEC announced that it is investigated how PIMCO has been pricing illiquid securities in its BOND ETF and suggesting that its returns may have been overstated (the investigation has also been attributed as a contributing but not primary factor in Gross' departure), an article about a recent NASAA proposal that state-registered investment advisers may soon be required to establish a succession and business continuity plan (public comment period closes on October 1st), a summary of FPA's current membership and revenue situation (declining for several years but now stabilized) as shared with the media at last week's annual conference, and an announcement from the CFP Board that it will be launching a "Career Center" with a job board, internship listings, and more, to encourage young people to enter the financial planning profession.

From there, we have several technology and practice management articles this week, including a discussion of the current technology offerings from the "Big Four" custodians and what they're working on rolling out in the coming year, the increasingly challenging environment for smaller RIAs to find a custodial platform that will work with them after Scottrade Advisor Services recently increased their minimums and introduced a significant platform fee for smaller advisors, a profile of the new management at Scottrade that suggests their goal is to turn the "Big Four" into the "Big Five" with rapid growth for Scottrade, and reviews of the new Junxure Cloud CRM (which advisor technology guru Joel Bruckenstein describes as having been "worth the wait") and also the Oranj practice management and marketing technology platform.

We wrap up with three interesting articles: the first describes the ongoing rise of the "virtual advisor", a human advisor who uses technology and video chat to work with clients efficiently and cost effectively (and remotely) in a "location independent" practice; the second is an "expose" on the too-close relationship between the Federal Reserve Bank of New York and the banks it oversees (especially Goldman Sachs) as illustrated by a "whistleblower" Fed examiner who recorded 46 hours of conversations highlighting the issue; and the last is a look from venture capitalist and Wealthfront founder Andy Rachleff about why VC firms will plow extraordinary amounts of money into companies that are not currently profitable (hint: it's all about the potential of future compounding growth).

And be certain to check out Bill Winterberg's "Bits & Bytes" video on the latest in advisor tech news at the end, including some highlights from this week's Finovate (financial services technology innovation) fall conference, and the Advicent (maker of NaviPlan) acquisition of Dutch financial planning software company Figlo! Enjoy the reading!

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