Enjoy the current installment of “weekend reading for financial planners” – this week’s edition kicks off with an announcement that there’s a new “fiduciary registry” being launched by the Institute for the Fiduciary Standard, with public support from TD Ameritrade and Pershing Advisor Solutions. The new registry aims to highlight firms that proactively embrace a more holistic fiduciary standard than the still-limited versions currently adopted by both the SEC (pertaining to RIAs) and the Department of Labor… and in the process, raising the question of whether firms can still compete by trying to be the ‘most fiduciary’ as a differentiator at all.
From there, we have several articles on advisor technology this week, including a recent study finding that if advisors want to reach younger “HENRY” clients (High Earners, Not Rich Yet) it’s essential to serve them in a more tech-savvy manner, software reviews of new retirement tools Last Advisor and Nest Egg Guru, and a look at the recent announcement that eMoney Advisor is aiming to build out a substantial suite of DoL compliance tools to complement its core financial planning software.
We also have a series of articles looking at the continuing evolution of DoL fiduciary’s impact on advisory firms, from a prediction by Ric Edelman that as many as half of all of today’s financial advisors will be driven out by the DoL fiduciary rule (clearing the way for more fiduciary- and client-centric advisors to take their place), a look at whether some advisors are selecting applying fiduciary rules in today’s environment (e.g., by building fiduciary portfolios but ignoring the more holistic demands of the fiduciary standard on the business), a prediction from Cerulli that the fiduciary standard will lead to more ‘cookie-cutter’ portfolios and less freedom/flexibility for most advisors, and a prediction that despite the push for economies of scale to handle compliance concerns a look at other industries suggests solo financial advisors and small RIAs will continue to survive and thrive going forward.
We wrap up with three interesting articles, all focused around the theme of the wealthy: the first is an excerpt from a new book entitled “Capital Without Borders”, that studied how ultra-high-net-worth clients engage with family wealth managers; the second is a look at how the “pentamillionaire” (with more than $5M in investable assets) is becoming the new millionaire, as there are now more than 1,000,000 US households that have reached the pentamillionaire status (having grown by 38% in just the past 5 years); and a fascinating exploration of how in theory it’s the poor who have to work extreme hours and the rich who have time for leisure, but in practice it’s turning out that 1-in-5 men in their 20s without a college degree is long-term unemployed (and that 3/4ths of their newfound ‘leisure time’ is being spent playing video games!), while higher income individuals have experienced the greatest decline in leisure time over the past generation.
And be certain to check out Bill Winterberg’s “Bits & Bytes” video at the end, which this week recaps the highlights of a new hackathon for advisor technology development, hosted this week at the 2016 eMoney Advisor Summit.
Enjoy the “light” reading!