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#FASuccess Ep 442: Attracting $100M Per Month Of Like-Minded Clients By Being Vocal About (Divisive) Issues You’re Passionate About, With David Bahnsen

June 17, 2025 07:01 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome everyone! Welcome to the 442nd episode of the Financial Advisor Success Podcast!

My guest on today's podcast is David Bahnsen. David is the founder of The Bahnsen Group, an RIA based in Newport Beach, California, that oversees approximately $7.5 billion in assets under management for 1,800 client households.

What's unique about David, though, is how his firm has been able to attract $100 million in new client assets per month thanks in large part to his content creation and public commentary on investment markets as well as issues that advisors often avoid, including religion and politics.

In this episode, we talk in-depth about how David's weekly market commentaries (which he has written since 2008 and draws 15,000 weekly viewers across blog, podcast, and video formats) familiarize readers with his firm's investment approach and put it top-of-mind when they are ready to seek out a financial advisor, how David has written multiple books on markets and his other passions that not only have educated readers on his views on these issues but also have led to many television appearances that have expanded his reach further, and how being public with his opinions on divisive topics has allowed David to demonstrate competence and likeability, attracting to his firm both like-minded consumers and some who might disagree with him but appreciate his willingness to be candid.

We also talk about how David's transition from focusing on both business development and client service to spend much of his time on content creation (reducing his client count from 180 to 20 in the process) has led to explosive asset and client growth in his firm during the past several years, why David focuses on hiring advisors with talent in financial planning and relationship management (rather than prospecting, given the robust lead pipeline his content generates), and how David has implemented a pay model that offers advisors a base salary in their early years while providing for significant income upside through revenue-based compensation (and a path to partnership) as they serve more (and higher-net-worth) clients over time.

And be certain to listen to the end, where David shares why he decided to incorporate tax preparation into his firm not as a profit center but rather as a way to offer a comprehensive financial services offering for clients (helping the firm close more prospects and maintain higher client satisfaction in the process), how David has found success opening offices located away from coastal population centers (not only to attract clients in those cities but also to demonstrate that they are a truly national firm), and how David, after growing a successful firm, is now focused on opportunities for his firm's advisors to develop in their careers as well as the ultimate stewardship of his business.

So, whether you're interested in learning about leveraging content across multiple media to attract like-minded clients, transitioning from a lead advisor to management role, or the decision making behind opening offices in new locations, then we hope you enjoy this episode of the Financial Advisor Success podcast, with David Bahnsen.

Trends In Financial Advice Fees: What Financial Advisors Are Actually Charging For Their Services

June 16, 2025 07:03 am 0 Comments CATEGORY: Practice Management

How advisory firms charge for financial advice has long been a central question in the profession. While many firms have historically relied on commission-based compensation methods – reflecting a sales-driven approach – financial advice has evolved with technological advancements and a greater focus on financial planning, with the Assets Under Management (AUM) fee emerging as the primary compensation model. Now, as financial advicers expand their services beyond traditional planning into more holistic, personalized advice, the very definition of financial advice continues to evolve. As a result, firms must continually reassess how they structure their fees to align with their growing range of services.

For firms evaluating pricing strategies, considering how others in the industry are adapting provides useful insights. Despite ongoing changes in the philosophy of financial advice, new Kitces Research on How Financial Advisors Actually Do Financial Planning finds that 86% of advisory firms still rely on AUM fees as their primary method of charging for advice. While this model remains widespread, firms have adopted different ways of structuring their AUM fees to align with their service models and client needs.

At the same time, AUM-based pricing is not without its criticisms. One common concern is that an advisor managing a $4M portfolio does not necessarily do twice the work of one managing a $2M portfolio, despite the fee being twice as high. However, most firms do not price their services in such a strictly proportional manner. Only firms using a flat fee structure, where a single rate applies to the entire portfolio regardless of size, use this kind of direct fee scaling. Instead, graduated and cliff pricing structures – which apply tiered or blended rates as assets grow – help balance costs across different client segments. These structures can also help advisors remain competitive on pricing, which may explain why 58% of firms use graduated fee structures, making them the most common pricing approach.

Despite its widespread use, AUM-based pricing has its limitations – it exposes firms to market risks and restricts the types of clients they are able to serve. To mitigate this, some firms 'unbundle' their fees, separating investment management, financial planning, and other services into distinct project-based, hourly, or retainer fees instead of covering everything under a single AUM fee. Notably, across nearly all client segments, research finds that the total fees charged by advisors who offer bundled and unbundled services tend to be nearly identical, suggesting that unbundling could be a viable way to make financial advice more accessible to clients with smaller portfolios. Another way firms reduce reliance on AUM fees is by using multiple charging methods, such as combining AUM fees with project-based or retainer fees. In fact, 72% of advisory firms use more than one charging method, allowing for greater flexibility in serving a broader range of clients.

Ultimately, as financial planning becomes more comprehensive and customized, fee structures are evolving to reflect this shift. While the mechanics of charging fees may not always change, the broader conversation around fees has continued to develop. At the same time, a wider range of fee structures could help firms serve a more diverse client base by expanding access to financial advice, which has traditionally remained concentrated in high-net-worth households. In other words, as financial planning becomes increasingly comprehensive, firms have the opportunity not only to refine their pricing models but also to rethink how they define – and deliver – value!Read More...

Weekend Reading For Financial Planners (June 14–15)

June 13, 2025 02:00 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that a recent survey of U.S. investors found that while 96% of respondents said they trust their (human) financial advisor, only 29% said they trust algorithms, suggesting that consumers continue to impose a "trust penalty" on algorithmically generated advice. Other key findings from the survey included a gap between long-term investment return expectations of investors and advisors (12.6% and 7.1%, respectively), continued investor concerns about inflation (with 61% ranking it as their top financial fear), and an increased demand for tax planning services (perhaps amidst the potential sunsetting of several measures within the Tax Cuts and Jobs Act), all of which offer advisors the opportunity to add value through proactive communication and technical planning strategies.

Also in industry news this week:

Under its budget proposal for the fiscal year 2026, the SEC expects to be able to examine 11% of RIAs per year, down from 14% in 2024, as it trims staff throughout the organization
RIAs lead the way among advisory channels in AI adoption, according to a recent survey, as advisors on the whole see themselves as more knowledgeable about technology.

From there, we have several articles on investment planning:

How interested financial advisors can evaluate different types of private investments, whose return profiles tend to be more opaque and challenging to analyze compared to publicly traded instruments
Why one author sees a confluence of factors (including a relatively low cost of capital and a sluggish IPO market) supporting private equity investments in the current economic and market environment
How advisors can offer value by helping clients understand whether they truly need to take the risks associated with certain alternative investments

We also have a number of articles on marketing:

Six ways advisory firms can fuel organic growth, from identifying their "loyal client advocates" to giving staff members specific business development roles that align with their strengths
How advisors can effectively attract and serve women clients, whose wealth has increased significantly and is likely to continue to do so in the coming years
How demonstrating expertise in helping clients during a specific major life transition (e.g., buying a home or claiming Social Security benefits) can help advisors tap into a potential pool of millions of individuals who face that challenge each year

We wrap up with three final articles, all about Artificial Intelligence (AI) and the workplace:

Why natural language processing tools (rather than text generation or more advanced "agents") could be the next big use case for AI in the workplace
Why professionals whose work is "illegible" (a group that likely includes comprehensive financial planners) will be less likely to see their jobs threatened by AI
How a new generation of AI-powered tools allow advisors to create their own applications without needing to have coding skills

Enjoy the 'light' reading!

Kitces & Carl Ep 166: Financial Planners As The Guide To Help Clients Navigate Potentially Changing Terrain?

June 12, 2025 07:04 am 0 Comments CATEGORY: Kitces & Carl Podcast

Every financial or business decision brings some amount of inherent risk. However, the consequences of those decisions – positive or negative – don't always align with the actual level of risk taken. As a result, when advisors are tasked with (re-)educating clients about the potential consequences of financial decisions, there may be a disconnect between potential risk and what a client actually experiences. So how can advisors help clients understand dangers they haven't personally encountered?

In our 166th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss how advisors can bridge the gap between planning and a client's lived experience to guide better decision-making.

One helpful framework to contextualize financial decisions is the concept of 'wicked' versus 'kind' learning environments. Kind environments have clear rules, quick feedback, and consistent patterns, making them easier to navigate and learn from. Tax planning often fits the 'kind environment' model: The rules are relatively stable, outcomes repeat annually, and feedback is immediate (e.g., a tax bill or refund). By contrast, wicked environments feature ambiguous rules and delayed or misleading feedback, where individuals can 'learn the wrong lesson'. Investment planning falls into this camp; a client who makes a risky bet and sees strong returns might conclude the strategy is sound, even if it was more luck than skill.

For planners, kind environments tend to allow for systematization and consistent advice delivery. Wicked environments, however, require more narrative focus and concrete examples. Advisors can use historical context and stress testing to show clients how a situation might play out differently under less favorable conditions. And when clients persist in making risky decisions, advisors can help by constructing guardrails, allowing for some flexibility while protecting against catastrophic loss.

The wicked/kind framework also appears in business leadership. Those who thrive in kind environments may excel at optimizing systems and scaling efficiently but might miss warning signs when conditions shift. Leaders in wicked environments may excel in handling ambiguity and disruption but may struggle to maintain stability in calmer business environments. Both leadership styles offer value, but they manage different types of risk and opportunity.

Ultimately, the key point is that the results of a decision don't always reflect the risk involved. Advisors who recognize this disconnect – and who adjust their planning strategies to fit the terrain – can help clients and businesses remain resilient across a wide range of circumstances. That means knowing when to lean into systems and when to pause and reassess, when to simplify, and when to explore new possibilities. And by helping clients understand the type of environment they're in – and shifting between 'peacetime' and 'wartime' toolkits as needed – advisors can offer more than just technical guidance. They become trusted navigators in a changing landscape, offering clarity, perspective, and a steadier path forward in an uncertain world!

Motivating Clients Of All Ages And Life Stages To Stop Delaying Estate Planning

June 11, 2025 07:02 am 0 Comments CATEGORY: Estate Planning

Even with the right messaging and tools, many clients still delay the estate planning process for various reasons. Some may assume that estate planning doesn't apply to their stage of life, especially those in their 30s–50s, who often believe their assets will automatically pass to a partner or children. But that assumption overlooks the nuances of state intestacy laws, which determine what happens when someone dies without a will. Others may agree, in theory, that estate planning is important but never follow through, either because the process feels overwhelming or because they're not sure how to begin.

In this guest post, Dave Haughton, Senior Corporate Counsel at Wealth.com, discusses how advisors can help clients overcome the logistical and emotional roadblocks that often get in the way of taking action. For many clients, the hesitation is more psychological than procedural. Estate planning means confronting death, working through sensitive family dynamics, and making decisions they may not feel ready for. Even clients who are willing to engage may find themselves stalled by the ‘paralysis of analysis' when faced with the complexity of estate planning.

To help move forward, advisors may need to shift the conversation from legal documents to personal values – framing estate planning as a way to preserve family harmony and protect loved ones. These motivators can give clients a clearer sense of purpose and make the process feel more meaningful. Life events such as marriage, divorce, the birth of a child, the sale of a business, or an upcoming international trip create natural opportunities for a conversation about estate planning. When no triggering event is present, timely news stories such as a celebrity estate planning incident can offer a relatable entry point and make the stakes more tangible.

If a client is just starting their estate plan or hasn't revisited it in years, the process can feel daunting. Advisors can ease the burden by focusing first on the essentials: a last will and testament, a revocable living trust, and powers of attorney. Addressing these core documents first can provide clarity and momentum, while creating space to revisit more complex issues over time. Estate planning can then become a recurring agenda item and incorporated into a planning service calendar. This approach can make the process more manageable while reducing the anxiety many clients associate with estate planning.

Ultimately, the key point is that while procrastination around estate planning is common, advisors can play a powerful role in helping clients overcome inertia. By making the process feel approachable and incrementally achievable, advisors can help transform estate planning from an intimidating obligation to an empowering act of care!

#FASuccess Ep 441: What It Really Takes To Implement And Scale Compliance As An Independent RIA Grows, With Leila Shaver

June 10, 2025 07:03 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome everyone! Welcome to the 441st episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Leila Shaver. Leila is the founder of My RIA Lawyer, a compliance and legal services firm based in Alpharetta, Georgia, that serves RIAs, broker-dealers, and other financial services companies.

What's unique about Leila, though, is how she helps firms navigate the increasing compliance burdens that can arise as they grow in size and complexity to ensure they remain in line with the requirements of their relevant regulators.

In this episode, we talk in-depth about how Leila has found that the time firms need to spend on compliance can vary based on their size (with solo advisors possibly only needing to spend a couple of hours per month and increasing as they add more employees), how Leila finds that firms tend to start looking for outsourced compliance solutions once they reach approximately $500 million in AUM (based on the growing complexity of the firm and the increased time needed to devote to supervision and other compliance tasks), and why Leila thinks that it’s not unreasonable for larger firms to spend 5–10% of their annual revenue on compliance (whether by hiring a sufficient number of internal compliance professionals and/or engaging an outsourced solution that can fully understand the firm’s operations).

We also talk about how Leila finds that while there are similarities between broker-dealer and RIA compliance (for example, in terms of practical testing requirements) many advisors who transition to the RIA model find that compliance is often less burdensome, how Leila sees broker-dealer compliance under FINRA as more rules-based and prescriptive while RIA compliance under the SEC is more principles-based (leaving greater room for interpretation on the part of the firm), and how Leila thinks that firms can benefit from working with a lawyer on compliance issues in order to not only get compliance guidance, but also actual legal advice when needed.

And be certain to listen to the end, where Leila shares why it’s valuable for firms to keep their compliance professionals in the loop when business planning to ensure potential time and/or hard dollar compliance costs are kept in mind when considering new initiatives, why Leila’s firm is building technology tools to both capture books and records needed for compliance but also ease the supervisory burden of compliance professionals, and how Leila has found many similarities between building an advisory business and a legal services firm, including the importance of having a differentiator in the marketplace and the time (and effort) it can take to build a successful practice.

So, whether you’re interested in learning about what it takes for RIAs to stay compliant with relevant regulations as they grow, the differences between RIA and broker-dealer regulation, or how to decide whether to handle compliance responsibilities in house or to hire external support, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Leila Shaver.

Summer Reading List Of “Best Books” For Financial Advisors – 2025 Edition

June 9, 2025 07:03 am 0 Comments CATEGORY: Personal/Career Development

2025 has had a tumultuous start for most advisory firms, as tariffs-driven market volatility has increased client anxiety and the amount of required hand-holding, forcing advisory firms to manage their own expenses a bit more closely in the face of greater revenue uncertainty. In the meantime, the buzz around AI continues to increase as well, less now about whether the tools will replace financial advisors (they don't), and more about how advisory firms can better leverage the technology to be more efficient in serving clients. Still, though, the reality is that the financial advice business is first and foremost a service business – humans in advice relationships with other humans – which means that while technology may help, it's the firms that are best able to attract, develop, and retain talent who are best positioned to win.

With summer approaching, though, we are entering the season of respite – a time when most advisors take more time off (if only because clients are harder to pin down for summer meetings, especially as post-pandemic summer vacations away from home are back in full swing)… and find some time to read and catch up on a few good books!

For those who love to read, though (and especially for those who have limited time and will only get to read just one or two books over the summer), the perennial question is always, "So… what's a good book worth reading this summer?"

As a voracious reader myself, I've always been eager to hear suggestions from others of great books to read, whether it's something new that's just come out or an 'old classic' that I should go back and read (again or for the first time!). And so, in the spirit of sharing, a few years ago I launched my list of "Recommended (Book) Reading for Financial Advisors", and it was so well received that in 2013 I also started sharing my annual "Summer Reading List" for financial advisors of the best books I'd read in the preceding year. It quickly became a perennial favorite on Nerd's Eye View, and so I've updated it every year, with new lists of books in 22014, 2015, 2016, 2017, 2018, 2019, 2020, 2021, 2022, 2023, and a fresh round last year in 2024.

And now, I'm excited to share my latest Summer Reading list of top books for financial advisors in 2025, from the benefit of not over-diversifying your business strategies and instead focusing on the few things that create the biggest impact, to a pair of books on succession planning (one for founders, and the other for successors) and how to approach succession for mutual success; from how to better position your value as a financial planner by describing not the long-term intangible benefits of financial planning but the shorter-term more quantifiable benefits of particular ideas your clients might implement, to interesting profiles of financial services industry legends like Bill Gross and Ray Dalio; along with a system to better institutionalize your advisory firm culture (and the behaviors its truly meant to espouse), to a primer on what it's really like to continue to manage and lead an advisory firm after private equity becomes an investor.

So as the summer season and summer vacations get underway, I hope that you find this suggested summer reading list of books for financial planners to be helpful… and please do share your own suggestions in the comments at the end of the article about the best books you've read over the past year as well!

Weekend Reading For Financial Planners (June 7–8)

June 6, 2025 02:00 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that a recent report finds that the number of SEC-registered RIAs, the assets that they manage, and the number of clients they serve all increased between 2023 and 2024 and suggests the industry is robust across the size spectrum, with both smaller and mid-sized firms seeing growth (often pushing them into higher size brackets and/or from state to SEC registration) and remains attractive to new entrants, whether those moving over from other models or totally new firms.

Also in industry news this week:

ETFs remain the most commonly used investment vehicle among advisors, according to a recent survey, while some "alternative" assets saw the greatest growth rates in terms of adoption over the past year
Several large brokerages have jettisoned their robo-advisor arms, signaling the challenges they faced in acquiring users of these services at a low cost as well as the value that human advisors can provide compared to their digital counterparts

From there, we have several articles on retirement planning:

Why pursuing financial independence is often more a matter of gaining flexibility rather than merely seeking leaving the workforce as soon as possible
What the Financial Independence Retire Early (FIRE) movement has contributed to the broader personal financial discourse and why more extreme implementations of its practices could create challenges for its followers
Two alternative types of "retirement" that could provide clients with greater flexibility without necessarily leaving the workforce permanently

We also have a number of articles on supporting clients in the home-buying process:

How advisors can add value by helping clients understand when they might be buying "too much" house
Why the lifestyle benefits of buying a particular home could outweigh financial considerations for some clients when such a purchase doesn't seem to make sense 'on paper'
How advisors can take an actuarial approach to help retired clients assess the implications of a potential home purchase on the sustainability of their financial plan

We wrap up with three final articles, all about building relationships:

Why social relationships, rather than individual effort, are often at the heart of personal and professional success
How to find time to connect with colleagues on a personal level when everyone in the (virtual) office is busy
How finding belonging in professional or personal affinity groups can lead to greater connections and personal fulfillment

Enjoy the 'light' reading!

Caught Between Privacy Laws And Contracts: The Compliance Dilemma Of Taking Clients To A New Firm

June 4, 2025 07:01 am 0 Comments CATEGORY: Regulation & Compliance

When a financial advisor transitions from one firm to another, they're often offered incentives by the new firm based on how much client revenue they bring with them. The challenge, however, is that advisors generally don't have the legal authority to simply transfer clients to a new firm. Because client relationships are technically "owned" by the firm – not the individual advisor – any transition requires clients to take action to shift from one firm to the other. This creates a host of challenges tied to client privacy laws and the advisor's contractual obligations to their former firms.

In this guest post, Isaac Mamaysky, Partner of Potomac Law Group and Cofounder of QuantStreet Capital, discusses the legal and compliance issues that arise when an advisor tries to bring clients with them to a new firm and the key considerations – including data privacy restrictions under SEC Regulation S-P and non-solicit clauses in employment agreements – that create complex dynamics and potentially conflicting obligations advisors must navigate to avoid violating privacy laws or breaching contractual obligations.

From a privacy standpoint, client data held by an RIA or broker-dealer is considered Nonpublic Personal Information (NPI) under Regulation S-P and generally cannot be shared with an unaffiliated third party without the client's consent – unless the firm's privacy policy explicitly allows it and the client has not opted out. Which means that if an advisor leaves a firm whose privacy policies don't permit such sharing, they can't take any client data with them, including names, contact details, or even knowledge that an individual was a client of the old firm. Furthermore, in states with stricter rules, such as California's "opt-in" privacy requirements, clients must affirmatively authorize information sharing at all times, adding another layer of complexity.

Although the Broker Protocol allows for the sharing of limited client contact information between firms, advisors and their firms are still required to comply with Regulation S-P. Advisors may only take information if their firm's privacy policies allow it and clients haven't opted out. In other words, participation in the Broker Protocol doesn't override privacy laws.

Further complicating matters, advisors may be bound by contractual non-compete or non-solicit clauses in their employment contracts with their old firm. These clauses typically prohibit advisors from encouraging clients to move with them to a new firm. So if an advisor is required to obtain client consent before transferring information to their new firm, they may be contractually prohibited from even asking for that consent. In other words, when privacy laws prohibit sharing information without consent, and contractual obligations prohibit asking for that consent, advisors risk violating either privacy law or their agreement with their previous employer!

Ultimately, the key point is that moving clients from one firm to another requires careful coordination across three fronts: Federal and state privacy laws, firm privacy policies, and employment agreements. While obtaining client consent is generally the safest approach, advisors must understand whether asking for that consent could violate their employment contract. While the rules can be complex, a thoughtful evaluation of the advisor's legal and contractual obligations, along with careful planning, can help manage their risk and increase the likelihood of a successful transition!

#FASuccess Ep 440: Making Client Meetings More Consistent Across Multiple Advisors By Utilizing A “Money Personality” Assessment, With Nina Hajjar

June 3, 2025 07:02 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome everyone! Welcome to the 440th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Nina Hajjar. Nina is a partner of Stratos CA, a hybrid advisory firm affiliated with Stratos Wealth Partners and based in Los Angeles, California, that oversees approximately $500 million in assets under management for 300 client households.

What's unique about Nina, though, is how she has developed a "money personality" assessment that allows her to both better understand how her clients' money behaviors might affect the financial planning process and to ensure consistent client service among the advisors at her firm.

In this episode, we talk in-depth about how Nina's assessment categorizes clients into one of six different personality types (for example, "dream chaser" or "safety seeker"), which helps her and her team learn how her clients are likely to respond to different planning scenarios and recommendations, how Nina pairs the money personality assessment with a complementary risk tolerance survey (which she uses to help craft appropriate investment portfolios), and how Nina approaches training advisors for what she calls the "art of the meeting" (giving clients the type of service they need by incorporating the lessons learned from their money personality assessments).

We also talk about how Nina has grown her firm in part through three acquisitions (finding that integrating the new firm and retaining its clients is easier when the selling advisor is looking for a good match for their clients), how Nina has structured acquisitions to incentivize selling firm owners to transition a high percentage of their clients and assets to the new firm (while protecting her firm's financial interests), and why Nina has found value by acquiring firms with an older client base (not only for their often high level of assets, but also for the opportunity to have contact with their beneficiaries who stand to inherit down the line and could bring more assets into the firm).

And be certain to listen to the end, where Nina shares the lessons she's learned from hiring employees (including the importance of getting the timing, compensation structure, and job description right for each hire), how Nina's own experience working with a therapist has helped her better understand the psychological challenges her clients face when it comes to money, and how Nina has found that her best business decisions have been made when she trusts her intuition (whether in terms of the types of people she works with or potential acquisitions she's considering).

So, whether you're interested in learning about using a "money personality" assessment to better understand clients' money behaviors and ensure consistent client service across multiple advisors in a firm, the opportunities and potential pitfalls of advisory firm acquisitions, or the key elements to making a good hire, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Nina Hajjar.