Weekend Reading For Financial Planners (November 22–23)

SEC Sets Sights On RIA M&A And Alts As 2026 Exam Priorities

(Sam Bojarski | Citywire RIA)

Each year, the Securities and Exchange Commission's (SEC's) Division of Examinations publishes a list of examination priorities, detailing the areas in which the agency plans to focus based on where it believes present potential risks exist to investors and the overall market. The regulator's list of fiscal year 2026 priorities was released this week, perhaps with some added interest from observers as it represents the first set of annual priorities issued by the regulator under new chair Paul Atkins.

Amidst record levels of RIA Mergers and Acquisitions (M&A) activity, the regulator indicated that it will focus on RIA dealmaking in the coming year, noting that M&A could create operational complexities and new conflicts of interest for firms (such considerations could include the terms of existing client contracts and the need to fully disclose conflicts related to a transaction, according to Lori Weston, head of compliance at STP Investment Services).

Reflecting growing discussion about the use of alternative investments, the SEC also indicated that it would review advisers' consideration of costs, risks, and conflicts of interest when it comes to alts such as private credit. Other focus areas highlighted include the use of emerging technologies such as artificial intelligence (including the accuracy of representations made by advisers using AI-powered tools), data security (amidst the upcoming deadlines for enforcement of amendments to the SEC's Regulation S-P, which concerns firms' use of private client data), dual adviser-broker registrants, and advisers that use third parties to access client accounts.

In sum, the SEC's 2026 exam priorities don't necessarily represent a wholesale change from its previous focus areas but do flag for RIAs key emerging areas that could be reviewed during upcoming examinations. Which helpfully gives advisors a heads up on areas to focus on for their own internal compliance reviews, before they potentially experience a formal examination in the coming year!

CFP Board Report Identifies 4 Scenarios For The Future Of Financial Planning In A World With AI

(Valentina Baez | Planadviser)

The growing presence of AI-powered tools has raised questions regarding its potential impacts on the financial planning profession, with optimists seeing it as a way for advisors to operate more efficiently and provide a deeper level of service to (potentially more) clients, while pessimists wonder whether consumers might turn to (likely lower cost) AI tools over a human advisor. Notably, though, the future might not end up on one of these polls, with various alternative scenarios being possible.

With this in mind, CFP Board convened an AI Working Group that recently released a report outlining four potential futures for the financial planning industry in 2030. The scenarios revolve around two different dimensions: the level of public trust in AI-driven financial planning advice and the level of disruption to the competitive landscape for financial planning. For instance, in a high-trust, stable environment (a scenario the report calls "Financial Planner's Best Friend"), human advisors thrive by having AI tools handle client onboarding, portfolio management, risk modeling, as well as compliance and administrative work with speed and accuracy, allowing them to focus on offering judgment, empathy, and holistic guidance to clients. In a similarly 'traditional' world without major outside disruption, but where the public is skeptical about AI-driven financial advice (perhaps driven by a major failure of AI-driven advice tools) human advisors continue to thrive, though potential talent shortages could lead to strain if the use of AI-powered tech tools is limited.

Looking at scenarios where the financial planning industry is disrupted significantly, one scenario (where public trust in AI-driven financial advice) could see big tech firms thrive as consumers flock to their AI-powered financial advice tools, with some demand still for human advisors who provide high-touch services that lean on empathy, behavioral coaching, and complex problem-solving. Alternatively, in a low-trust environment (perhaps due to a failure of AI-powered tools to provide accurate and reliable advice during a major recession), relatively wealthier consumers might flock (back) to human advisors while tech firms that developed (relatively lower cost) advice tools continue to serve relatively lower-income individuals.

In the end, while the future pace of AI development and its impact on the financial planning industry are unknown, considering potential scenarios can help firms and advisors consider how they might position themselves to thrive in various environments that might emerge (from using AI tools in line with their clients' trust in them to sharpening the skills that help human advisors stand out from digital alternatives).

The SEC Has Cut Down On Off-Channel Texting Probes, Compliance Execs Say

(Sam Bojarski | Citywire RIA)

In decades past, advisor-client communication largely entailed in-person meetings and phone calls. But today, advances in technology have brought a range of new options, from email to text messages. While convenient, a wider array of communications methods can create a headache for firm compliance officers charged with tracking advisor-client communication subject to relevant regulations (with the Securities and Exchange Commission [SEC] issuing more than $2 billion in fines for employees' use of unapproved communications channels, such as text messages sent from personal phones).

However, amidst turnover in leadership at the regulator this year, a number of RIA compliance experts have indicated that they're seeing a cooling off in enforcement activity related to off-channel communications. To start, the SEC announced its last settled enforcement case related to off-channel communications in mid-January (during the final days of the Biden administration) and have not yet revealed any settled cases in this area since then. At an anecdotal level, compliance professionals have reported that firms they work with are experiencing lighter-touch examinations of their communications archiving practices (e.g., by looking at current practices and not necessarily reaching back several years). Nonetheless, these experts caution firms not to let their guards down when it comes to their archiving responsibilities and data security (e.g., by prohibiting work product from being sent from work email to personal email accounts).

Ultimately, the key point is that while the SEC under new chair Paul Atkins appears to be reducing its focus on evaluating firms' off-channel communications practices, though this will likely remain an important compliance area for firms as digital communications methods expand (which might lead firms to consider using available AdvisorTech tools to make the job easier (though they will still have to ensure firm employees aren't using unauthorized communications methods that can't be tracked!).

A Q4 Checklist For Retirement Savers (And Their Advisors)

(Christine Benz | Morningstar)

The fourth quarter can be a busy time for both advisors (as they try to fit in various year-end client and business management tasks) and their clients (who might be spending more time thinking about the holidays than their financial lives). With this in mind, making a checklist of key retirement-related areas to consider can reduce the chances that an important task slips through the cracks.

First, clients can ensure that they're on pace to make their desired contributions to workplace retirement accounts (including 'catch-up' contributions for those over age 50 and 'super catch up' contributions for those between 60 and 63). Also, while IRA contributions for 2025 can be made until April 15 of next year, getting those contributions made earlier could lead to greater compounding over time (and ensure this task isn't forgotten). Other key IRA 'maintenance' items could include (depending on the client), finalizing Roth conversion amounts for the year (as an advisor can have a much clearer picture of the client's income for 2025), completing 'backdoor' Roth contributions, or rolling over workplace retirement accounts from an employer that was left during the year.

Looking at a client's portfolio, identifying opportunities for tax loss harvesting (or perhaps capital gains harvesting if they're experiencing a year of relatively low income) could be valuable moves. Also, the end of the year could be a good time to rebalance client portfolios (or perhaps move out of mutual funds that leave a lump of coal in the form of an end-of-year capital gains distribution!). And while not directly related to retirement, advisors could encourage clients with Flexible Savings Accounts (FSAs) to create a plan to spend down any remaining dollars in the account before the end of the year (or the company-specific grace period deadline).

In sum, advisors potentially have several opportunities at the end of the year to support clients with their retirement savings, whether in the form of short-term tax savings opportunities or building a larger portfolio down the line. And by keeping these various tasks on the radar (whether through a tool such as a client service calendar or through CRM or other reminder tools) advisors can ensure no opportunity slips through the cracks!

How To Help Clients Avoid Medicare IRMAA Surcharges

(Roger Wohlner | ThinkAdvisor)

An issue that is a thorn in many clients' sides is exposure to Income-Related Monthly Adjustment Amount (IRMAA) surcharges, which increase the Medicare Part B and Part D premiums individuals pay if their Modified Adjusted Gross Income (MAGI) exceeds certain thresholds (which, for 2026 start at $109,000 for those filing individual tax returns and $218,000 for those filing joint returns). Which means that the ability to control realized in the current year (which affect IRMAA surcharges two years in the future, meaning that 2025 income will impact 2027 surcharges) could result in cost savings for these clients.

Different IRMAA-related strategies will apply for clients in particular circumstances. For clients currently receiving Medicare benefits and who are subject to Required Minimum Distributions (RMDs), making Qualified Charitable Distributions (QCDs) can have the dual benefit of reducing income for current-year tax purposes (as the QCD could cover part or all of the RMD obligation) but also reduce MAGI for IRMAA calculation purposes. For those in their 60s, the decision of when to claim Social Security benefits can impact IRMAA as well, as delaying these benefits could potentially reduce a client's MAGI and IRMAA exposure during these years.

In addition, those in this group (particularly those who have retired) might also be considering Roth conversions. These can be a double-edged sword when it comes to IRMAA, as while they reduce the size of future RMD obligations, they count as current-year income and could tip a client into a higher IRMAA bracket (though some clients might be willing to 'fill up' another IRMAA bracket to gain the other benefits of a Roth conversion). A similar issue is faced by those still working but are currently receiving Medicare benefits (or will be two years from now), as Roth retirement account contributions can reduce future RMDs but do not reduce current-year income, while traditional contributions can reduce income for both current-year tax and IRMAA purposes (though a client's current and expected future tax brackets could play a key role in this decision as well).

Ultimately, the key point is that given the 'pain' many clients feel around IRMAA surcharges, financial advisors can often gain significant goodwill by helping them reduce or eliminate this burden through income planning (particularly as they near the next IRMAA bracket, as going just $1 over the limit will force them to pay the higher surcharge for the full year) or by submitting an appeal, though in some cases advisors might recommend strategies (e.g., Roth conversions) that could offer certain clients more long-term benefits than reducing the IRMAA burden in the current year (though they might face skepticism from clients in some circumstances?).

Roth Conversion Cost Averaging And Barbelling Strategies For The New Year

(Jeffrey Levine | Nerd's Eye View)

The Tax Cuts and Jobs Act (TCJA) of 2017 eliminated recharacterizations of Roth IRA conversions made in 2018 or later, as while Roth recharacterizations were originally created as a means to "undo" a Roth conversion for someone who later discovered they were over the conversion income limits (which were in place until repealed in 2010), they had been increasingly used as a proactive strategy to increase the value of Roth conversions... and thus became perceived as an "abuse" and "loophole" that Congress felt the need to crack down on. Nonetheless, while Roth recharacterizations are now gone, it doesn't change the fact that Roth conversions themselves can still be effective tax planning tools for helping clients reduce their long-term tax liabilities. However, the elimination of the Roth recharacterization changes the optimal timing and execution of Roth conversions going forward.

In the past, completing (partial) Roth conversions as early as possible in the year was generally ideal, as a means to both maximizing the time available to consider a recharacterization, and because of the general trend for markets tend to go up more than they go down (which meant it was best to get the dollars into the Roth as early as possible so that growth would happen inside the tax-free account). Now, however, the inability to undo Roth conversions (including partial recharacterizations of an excess conversion) means it will often be more effective to implement conversions towards the end of the year, when income (and deductions) can be projected more accurately with greater confidence.

Clients could also consider various Roth conversion timing strategies when it comes to deciding when to complete the conversion. For instance, with 'conversion-cost averaging', an advisor can work with their client to determine a provisional Roth conversion amount for the year (based on the client's expected income and tax rate) and then divide that amount into monthly conversion amounts (like dollar cost averaging when it comes to investments, this averages out exposure to the market's ups and downs over the course of the year). Another (and perhaps less time-intensive) approach is Roth conversion "barbelling", where up to two conversions per year are carried out; one conversion is made as early in the year as possible, and a second conversion is made much later in the year when the client's tax picture is clearer (thus forming a 'barbell' shape with two big conversions at either end of the year, with little or no conversion activity in between). With this strategy, the initial converted amount gets the benefit of tax-free growth (if the market rises), while the second conversion can be adjusted based on the client's actual taxable income for the year (and lets the client take advantage of the 'sale' on Roth conversions if the market declines during the year).

In sum, while it is late in the year to implement a 'conversion-cost-averaging' or 'barbelling' strategy for 2025 (but by no means too late to execute a Roth conversion in general!), the fourth quarter could be a good time to work with clients to create a plan for their Roth conversion strategy for 2026 and beyond.

How To Rank For "Financial Advisor Near Me" Searches

(Brent Carnduff | Advisor Rankings)

Given the importance of financial planning (and the tech-enabled ability for many advisors to serve clients nationwide), one might assume that a consumer would carefully search for the 'right' advisor for them, independent of their location (or at least have a willingness to look beyond their immediate vicinity). Nonetheless, given data indicating that the keyword "financial advisor near me" is searched over 60,000 times per month in the U.S., it's evident that many consumers begin their search by filtering the hundreds of thousands of financial advisors to those located near them.

Which suggests that financial advisory firms could potentially increase their flow of inbound leads by being one of the firms highlighted when a consumer performs the "near me" search in Google. To start, a firm can claim and optimize its Google Business Profile, which allows a firm to set it address, services, website, and more (increasing the chances Google will suggest the firm when individuals in the same area perform the "near me" search). To further boost Google visibility, a firm can build landing pages on its site for where it is located (or multiple landing pages if it has offices in more than one city). Such pages might include an H1 header and title tag with the city or region, an intro that references the city and services offered, and an embedded Google Map of the business location, amongst other features.

Other ways to rise up the "financial advisor near me" rankings include being listed in local and industry directories (e.g., Yelp or CFP Board's directory) to reinforce the firm's legitimacy and earning positive client reviews (particularly ones that reference the firm's location alongside its characteristics (notably, because "near me" searches trigger Google to search geographically [rather than searching for sites that feature the words "near me"] including "near me" on a firm's website is unlikely to boost its position in search results).

Ultimately, the key point is that while an advisory firm might seek clients beyond its local area, maximizing its searchability for consumers who are within their vicinity could lead to a boost in visibility and inquiries. Which means that helping search engines such as Google (as well as Artificial Intelligence tools, which are increasingly used for search) understand more about the firm and the value it provides for its clients could be a key step to boosting client numbers in the years ahead.

4 Ways Advisors Can Boost Their Presence In AI Search Results

(Brian Thorp | ThinkAdvisor)

For many years, financial advisors have engaged in Search Engine Optimization (SEO) techniques in order to appear higher on the search results when a consumer searches for an advisor like them (e.g., "retirement income planning in X city"). The past few years, though, have seen a rise in the use of AI-powered tools (e.g., ChatGPT or Claude) for answering questions that might have previously been put into a search engine. Which could require different tactics for firms to engage in "Answer Engine Optimization" (AEO) and be seen by these tools as trusted sources of information (and financial planning services).

One way to do so is by including a Frequently Asked Questions (FAQ) page on the firm's website and on directories where it's listed that includes content separated into 40-60 word chunks to help AI tools better understand the firm's services and expertise. Having (positive) client testimonials and online reviews can also be a way to send trust signals to AI tools and be more likely to be cited in responses to consumer questions. Relatedly, being quoted in media outlets can help an advisor gain credibility with AI tools and demonstrate their expertise. Finally, strengthening "offsite" optimization (i.e., having a presence on third-party platforms frequently referenced by AI tools [e.g., directory listings hosted by different professional credentialing organizations]) can further generate greater visibility.

Altogether, while much of SEO involves optimizing a firm's own website, a major part of AEO is being visible across the internet, particularly when it comes to influential sites and publications. Which could ultimately help advisors be included in the responses of AI tools to user queries and be seen as a trusted source of financial information (and, hopefully, a trusted advisor who the consumer might consider contacting!).

Micro-Moves To Become The Go-To Financial Advisor In Your City

(Brady Lochte | Advisor Perspectives)

While some advisors seek to work with clients who fit a certain profile (e.g., life stage, occupation, affinity) independent of their location, local clients remain the bread and butter for many firms. With increased competition from 'outsiders' though, it has become more challenging for firms to be seen as the best option for those in their area.

However, local firms have an advantage thanks to their ability to have a regular physical presence in their communities. For instance, writing a column in the local paper, appearing with local media personalities and influencers, building relationships with local centers of influence (with whom an advisor can have a in-person coffee [instead of chatting over video]) and being 'present' (e.g., having a booth at local festivals or volunteering in schools) can all be ways to build visibility, familiarity, and trust. In addition, a local presence can be beneficial online as well (e.g., by appearing in Google searches for "advisors near me") and in being able to tailor content to the local community (e.g., putting case studies on the firm's website that reflect issues common to those in their local community instead of more generic topics).

In the end, one of the key benefits of having a local presence is the ability to show up consistently in the community and be seen as a go-to source of planning advice if a neighbor is seeking a planning relationship today or as the first advisor that comes to mind for those whose planning needs emerge in the future.

The Silver Bullet Fallacy

(Tim Harford)

When confronted with a challenging problem, a common retort is that "there are no silver bullets", or no single solution that will definitively solve the issue. Which can sometimes lead to resignation that there aren't workable solutions to a thorny issue (whether a public policy, health, or economic problem).

Harford argues, however, that while some policy issues don't lend themselves to simple solutions, it's not necessarily a reason to give up despair but rather an opportunity identify component problems that are more similar to 'werewolves' (that come with a clear workable solution). For example, in the world of investing it was long challenging for individual investors to achieve a highly diversified portfolio in a cost-efficient manner. A potential solution to this problem came in the form of the index fund, which provides the opportunity for diversification in a single, relatively low-cost vehicle.

While an index fund could be considered a 'silver bullet' for the problem of low-cost diversification, it doesn't necessarily solve the thornier problem of long-term investment success (as index fund investors can still 'buy high and sell low' on a particular fund, or as the flavors of index funds have expanded, chase the latest hot sector). Which perhaps shows that 'silver bullets' might not be a panacea in isolation and could require additional work to achieve longer-lasting success (in the case of investment, this perhaps recognizes the value of financial advisors, whose experience and technical expertise can help clients best leverage available 'silver bullets' to create an effective, comprehensive financial plan).

In sum, while some problems lend themselves to single, elegant solutions, others have greater complexity and require broader-based expertise and a willingness to experiment with different solutions. Which, given the complex nature of financial planning, suggests that advisors could have job security well into the future as they could hold advantages over tech tools that might excel at 'solving' individual problems but be challenged at delivering a more holistic advice experience?

The Narrow Path: Why Choosing Hard Things Is Your Best Investment

(Tim Maurer | The Net Worthwhile)

At certain points in life, it can feel like things are under control, whether in terms of health, jobs, or relationships. Which could make 'coasting' (i.e., continuing on the current path rather than pursuing a more challenging alternate course) an attractive option.

However, there are many potential advantages to be gained by getting out of one's comfort zone and taking what Maurer calls "the narrow path". For instance, choosing an uncomfortable option (e.g., a more rigorous workout routine or taking the leap to a new job) can lead to what neuroscientists call "stress inoculation", or the ability to build tolerance to future stressful situations (e.g., an illness, job loss, or grief). Choosing a more difficult path can also bring rewards through greater autonomy. For instance, in the financial advisor context, an advisor might make a good salary working as an employee but could find greater personal freedom and meaning by making the jump to start their own firm in their desired image. Taking on a rigorous challenge can also help individuals slow down the 'mental chatter' that can get in the way of more productive pursuits (e.g., it's unlikely that work stress will be top of mind as an individual is nearing the end of a long run).

Ultimately, the key point is that actively choosing to take on difficult challenges is not necessarily about appearing 'tough' in the eyes of others or achieving a certain accomplishment, but rather conditioning oneself for the inevitable challenges that arise over time, better focusing on the task at hand, and feeling more in control of one's life and outcomes.

Practical Invitations For Handling Uncertainty

(Meghaan Lurtz | (Less) Lonely Money)

An inevitable part of life is handling uncertainty, which can range from smaller problems (e.g., the probability that it will rain today) to bigger questions (e.g., how much an individual can sustainably spend throughout their retirement). The ability to handle uncertainty, though, can vary significantly across individuals or, for the same person, across different types of problems.

First, being able to identify uncertainty and the challenges in dealing with it can create an honest foundation to try to tackle the problem at hand (as opposed to ignoring it or underplaying its seriousness). Next, developing a sense of patience, not necessarily by setting a particular waiting period (e.g., creating a deadline to make a decision), but perhaps by opening up more room to make a decision could provide the space needed for coming up with a workable solution for the uncertain situation. For instance, a financial planning client might be deciding whether to sell their house, which could have a clear financial answer (e.g., the proceeds from the sale could support their retirement lifestyle) but come with emotional challenges (e.g., leaving the house where they raise their kids). Rather than aiming to elicit a decision in a particular conversation, an advisor might give clients room between meetings to think about the issue, which might clear things up before the next meeting.

Notably, dealing with uncertainty doesn't require going all-in on a single solution but rather could involve small 'experiments'. For instance, a client considering when to retire (and what to do when they do so) might try taking an extended sabbatical to feel out the experience without completely leaving their job. Uncertain situations also don't have to be addressed alone, with conversations with family, friends, or (for certain issues) a financial advisor (who's perhaps armed with effective questions to help a client evaluate a challenging problem) could widen one's scope and reveal potential solutions.

In the end, while uncertainty is a part of life, it doesn't necessarily have to lead to extended mental stress. Rather, tactics such as showing patience, leaning on the support of others, or experimenting could increase one's confidence that they've thought through the issue at hand and have identified a workable solution.

---

We hope you enjoyed the reading! Please leave a comment below to share your thoughts, or send an email to [email protected] to suggest any articles you think would be a good fit for a future column!

In the meantime, if you're interested in more news and information regarding advisor technology, we'd highly recommend checking out Craig Iskowitz's "WealthTech Today" blog.