Enjoy the current installment of "weekend reading for financial planners" - this week's issue starts off with a summary of some of the final comment letters submitted regarding the SEC's request for information for a cost-benefit analysis about a uniform fiduciary standard. Why industry organizations like SIFMA and NAIFA indicated that a fiduciary standard would significantly increase compliance costs and force advisors to stop serving middle market clients, the results of a Financial Planning Coalition study found that fiduciary advisors generate significantly more revenue - suggesting that revenue growth could more than offset any higher costs - and that there are no statistically significant differences between the number of middle-market clients that fiduciary vs non-fiduciary advisors currently serve.
From there, we have a wide array of technical articles, including: a discussion of the ongoing Commission on Long-Term Care established by the American Taxpayer Relief Act to propose structural solutions to the country's long-term care challenges; a great overview of the coming new health insurance rules and how to start planning for them; a discussion of the importance of disability insurance for both clients and advisors themselves; a look from Ed Slott at how the Net Unrealized Appreciation strategy may be a little less appealing at today's long-term capital gains tax rates; and an intriguing analysis by Moshe Milevsky that in some circumstances equity-indexed annuities with guaranteed living benefit riders might actually produce slightly more income than a simple single-premium immediate annuity.
There are also a number of investment-related articles this week, from a review of recent applied research by Harold Evensky in the Journal of Financial Planning, to a discussion by Bob Veres of five new investment approaches being implemented by advisors that appear to have value, to a look at whether it's time to acknowledge that the efficient frontier of mean-variance optimization is more like an efficient "range" because ultimately neither the inputs to the model nor the preferences of investors are really as precise as a strict interpretation of Modern Portfolio Theory implies. There's also a good review of the recent Active Share research and why "hyperactively managed" funds may be best outperformers of all actively managed funds.
We wrap up with an article from industry veteran and luminary Richard Wagner, who suggests that financial planning could become the most important profession of the 21st century, as we human beings collectively become increasingly cognizant of the powerful role that money exerts in our lives, and the unique contribution that financial planners can bring to the table in helping clients to navigate those forces effectively. Enjoy the reading!
