Weekend Reading For Financial Planners (January 24–25)

RIA Channel Continues To Add Advisors In 2025 While Total Industry Headcount Drops

(Diana Britton | WealthManagement)

Much has been written about the 'graying' of the financial advisor population, with the industry needing to backfill for an expected wave of advisor retirements (and to potentially grow larger to meet the growing demand for financial advice). Though, notably, the inflow and outflow of advisors can look quite different across different channels, as advisor movement can include not only retirements and departures for other industries, but also transitions between channels.

According to an analysis of Securities and Exchange Commission (SEC) data by AdvizorPro, the industry as a whole saw a net outflow of advisors in 2025, with 53,461 net new advisors and 57,380 advisor departures, for a net outflow of 3,919 (a shift form 2024, which showed a small net increase in advisors). Notably, though, net additions and departures weren't consistent across channels, with RIAs experiencing a net gain of 17,453 advisors, with other channels experiencing net losses (including outflows of 1,864 for wirehouses, 4,057 for broker-dealers, and 15,453 for the dually registered, or hybrid channel).

Looking at advisor transition patterns, most advisors who moved from their broker-dealer, hybrid firm, or RIA stayed in the same channel and simply moved to different firms or platforms, while a strong majority of wirehouse advisors moved to a different channel. Nonetheless, the draw of the RIA model appears to be strong, with 32% of departures from hybrid firms and 26% of those leaving wirehouses moving to RIAs. Notably, though, this is largely a one-way street, as 97% of RIA advisors who left their firm stayed in the RIA channel.

It's also notable that the results show that total outflows from dual-registrants at independent broker-dealers, into the RIA channel, appears to be accelerating (as the net outflow rose from 4,379 in 2021 to 7,036 in 2023 to the 15,453 departures in 2025). Which signals that while early on, the rise of the hybrid movement was suggested to be a destination – that advisors would choose to sustain doing brokerage business for some (smaller or more transactional) clients, and ongoing advisory for the rest – in reality becoming a hybrid appears to have emerged as more of a waystation for broker-dealer representatives ultimately moving entirely to the RIA channel..

In sum, these figures show both the need for a greater inflow of advisors into the industry (along with career paths that will make them want to stick with it!), and the continued attractiveness of the RIA channel for many advisors. Which may, in turn, help to explain why a growing number of independent broker-dealers are trying to adapt themselves as platforms that can also serve as "RIA support platforms" for brokers who want to entirely drop their FINRA licenses (but remain with the platform)… even as more corporate RIA and standalone RIA support networks are also still on the rise as the service-provider ecosystem to support independents also continues to grow to support them.

CFP Board Names New CEO, As Organization Reports Record CFP Certificants In 2025

(Alec Rich | Citywire RIA)

CFP Board is one of the most important organizations in the wealth management industry in its standard-setting role for the more than 100,000 CFP certificants (which increasingly bleeds over into the financial advice industry writ large as an ever-growing percentage of financial advisors are now CFP certificants), along with its efforts in providing legislative advocacy for higher standards in the industry, promotion of comprehensive financial planning advice to consumers (including advertising campaigns encouraging consumers to seek out CFP professionals when in need of financial advice), and encouraging students and career changers alike to consider a career in financial planning. Which puts significant responsibility on its CEO as a key influential figure in the industry to lead these areas (and more) as the CFP Board advances the financial planning profession as a whole.

After serving in the role since 2007, the CFP Board announced last February that CEO Kevin Keller planned to retire and step down from his position in 2026. Following a year-long search for his replacement, CFP Board announced this week that K. Dane Snowden (who has served as the organization's Chief Operating Officer [COO] since 2023) will take the reins on March 16th. Before joining CFP Board, Snowden was the president and CEO of the Internet Association and was previously the COO of the National Cable & Telecommunications Association. He had also served as a public member of CFP Board's Board of Directors from 2017 to 2020.

At a time when there are concerns about an aging advisor workforce and the industry's ability to meet consumer demand for financial advice, Snowden will inherit a growing organization, with CFP Board announcing that it added 6,709 certificants last year (a new single-year high), bringing the total number of CFP professionals to 107,529 by the end of 2025 (notably, 3,964 of the new CFP professionals are below age 35, providing a source of next-generation talent to firms). At the same time, with the increasingly political dynamics of the CFP Board – both given its ever growing number of large enterprise stakeholders, and how it increasingly overlaps with regulators like FINRA and the SEC as it develops its own enforcement capabilities – mean that the CFP Board's new CEO will have to navigate the stakeholder dynamics of an organization that faces more complex industry politics.

In the end, while CFP Board appears to be a positive track attracting candidates for certification (which increasingly includes not only independents, but many from large firms across industry channels, with LPL Financial, Edward Jones, Charles Schwab, Northwestern Mutual all adding at least 200 new certificants in 2025), Snowden will face many challenges and opportunities, from maintaining the quality and integrity of the fiduciary standards its certificants are required to uphold (as more insurance and brokerage firms, who do not themselves have a fiduciary obligation, continue to adopt the marks) to ensuring that CFP professionals continue to stand out from other sources of financial advice in the eyes of consumers as the leading marks to connote who is really a financial planning professional!

FINRA Advances Proposed Rule That Would Eliminate Requirements For B-Ds To Supervise Unaffiliated RIAs (And Potentially Reduce B-Ds Taking RIA Haircuts?)

(Sam Bojarski | Citywire RIA)

Given the potential for conflicts of interest, and the risk of "selling away" unregistered securities, broker-dealer registered representatives are required by self-regulatory organization FINRA to disclose certain Outside Business Activities (OBAs), with the broker-dealer required to evaluate the activity and assess whether the activity should be limited in order to ensure it doesn't interfere with or otherwise compromise the representative's responsibilities to the broker-dealer and its customers (or be viewed by the public as being part of the broker-dealer's business itself). Representatives are also required to report private securities transactions that the firm is also required to supervise (e.g., to ensure that the broker is not trading ahead of their own clients).

Amidst this backdrop, FINRA last year proposed a new rule that it said was designed to streamline regulations in these areas and in some ways narrow the scope of existing requirements (e.g., excluding securities transactions among immediate family members, and more generally narrowing the scope of OBAs that need to be overseen that clearly are not relevant to the broker-dealer's business in the first place). At the time, some commenters on the proposal expressed concern that other parts of the rule could dramatically increase the compliance burden on certain broker-dealers and RIAs (e.g., possibly bringing otherwise independent RIAs under a broker-dealer's oversight when using the broker-dealer for certain transactions, such as using the broker-dealer to 'park' old commission trails when otherwise fully transitioning to the RIA model), though FINRA subsequently issued a statement to "clarify" its proposal, saying that, under the proposed rule, broker-dealers are not intended to have any additional duties to supervise the OBAs of their representatives.

FINRA has now submitted the proposal (dubbed Rule 3290) for approval with the SEC for approval, which will now hold a 90-day comment period. Notably, the latest version of the rule revises FINRA's approach to unaffiliated advisory activity – i.e., having an outside RIA (not the B-D's own corporate RIA, but a standalone RIA that the advisor owns and is separately affiliated with), turning it from an "outside securities transaction" (requiring supervision and recordkeeping of this activity by the member broker-dealer) to an "outside activity" (requiring written notice and upfront assessment and approval obligations for such activity by the broker dealer, but not ongoing supervision responsibilities).

If adopted, the proposal could have significant implications for independent advisors who have a broker-dealer registration and their own RIA, as while their broker-dealer would review and decide whether to approve the activity upfront, it would not have an ongoing obligation to supervise. Which both reduces the compliance burden of having an outside RIA when affiliated with a broker-dealer… and could make it harder for broker-dealers to claim that they need to charge a fee (e.g., a grid or haircut payment) against these advisors's RIA revenue for these supervisory responsibilities (though dually registered advisors using the broker-dealer's own corporate RIA would appear to be still be subject to the broker-dealer's supervision as an investment adviser representative of their RIA).

Altogether, it appears that rather than potentially increasing the compliance burden on certain broker-dealers, RIAs, and individual advisors (as was initially feared by some when the proposal was initially released last year), these industry participants could see reduced obligations under the proposed rule that would narrow the broker-dealer's oversight scope more narrowly to its core brokerage duties and obligations. While FINRA with this proposal might be looking to reduce compliance burdens at a time when many advisors are moving towards full independence in the RIA channel, it is interesting that the rule could reduce a revenue stream of its member broker-dealers…though perhaps some will find other ways to maintain this income (or perhaps take a stricter stance towards approving outside investment advisory activity versus requiring use of the broker-dealer's own corporate RIA in the first place?).

The Best Retirement Income Strategies For Leaving Money Behind

(Amy Arnott | Morningstar)

Many individuals seek to leave a financial legacy after their deaths, whether in leaving money to loved ones and/or donating to favorite charities. Which can complicate planning discussions surrounding retirement income, as such an individual will want to balance meeting their lifestyle needs in retirement with the desire to have a certain amount of money left to fulfill their legacy goals.

In general, retirement income strategies that are more conservative in nature (i.e., prescribe smaller portfolio withdrawals in order to minimize the risk of portfolio depletion) tend to result in larger ending portfolio balances (that can be used to fulfill legacy goals). For example, analysts at Morningstar analyzed 1,000 hypothetical return patterns for a $1 million portfolio balance over a 30-year period (assuming a 40% stock/60% bond allocation and a withdrawal rate that ended with a positive balance in at least 900 of the trials) finding that a "base case" of making first-year withdrawals equal to 3.9% of the portfolio amount (adjusting this amount for inflation in future years) resulted in a median portfolio balance of $1.42 million after 30 years (reflecting the significant upside potential of sequence of return risk!).

For those who would want to spend more in retirement, other strategies offered higher initial withdrawal rates and sizeable ending portfolio amounts. For instance, a strategy that started with a 5.00% withdrawal rate but reduced inflation-adjusted spending by 2% each year throughout retirement (reflecting the tendency for inflation-adjusted spending to decline throughout much of retirement) led to a median ending portfolio balance of $1.34 million. An alternative approach that would have a retiree forgo inflation adjustments for the year following a year in which the portfolio declined in value would allow for a 4.30% starting safe withdrawal rate and result in a median ending value after 30 years of $1.28 million.

Altogether, these strategies could be attractive to retirees who both want to be conservative with their portfolio withdrawals and have a strong interest in leaving a (potentially large) legacy interest. Of course, such approaches come with tradeoffs, whether in terms of a relative lack of flexibility (given the prescribed nature of initial and subsequent withdrawals), lower annual withdrawals than might be available under other strategies, and (for those who choose a strategy that sometimes forgoes inflation adjustments) the risk that inflation could eat into their standard of living. Which presents an opportunity for financial advisors to offer value not only in crunching the numbers on different retirement income strategies and the tradeoffs involved (and perhaps recommending more flexible income strategies), but perhaps at a more fundamental level discussing the pros and cons of waiting to leave a legacy versus giving during one's lifetime (e.g., the potential to give more at death versus potentially giving money to loved ones when it is needed more and being alive to see the impact of this generosity).

Stop Chickening Out When It Comes To Choosing A Retirement Income Strategy

(Jordan Grumet | The Purpose Code)

The transition to retirement can be challenging in many ways, not the least being the shift from receiving regular paychecks from a job to generating income from other sources (often a combination of portfolio withdrawals, Social Security benefits, and perhaps a defined-benefit pension). Particularly for those who will be heavily reliant on their portfolios for generating income throughout retirement, the choice of strategies to do so can be particularly fraught, as the specter of depleting a portfolio and not being able to support one's lifestyle can be nerve-wracking.

Grumet suggests, however, that some retirees take this too far, choosing a retirement income strategy that has been shown to be successful through even the worst-case historic market scenarios but then adding on additional defense mechanisms that result in less income to spend in retirement (for potentially very little benefit). For instance, the well-known "4% rule", under which a retiree withdraws 4% of their initial portfolio value and then adjusts this amount for inflation in subsequent years (across a 30-year retirement), was designed to be robust against even the worst market environments. Which means that adding additional 'defensive' moves (e.g., not taking the inflation adjustment in years after experiencing a year of negative portfolio returns) would likely be overkill and lead to spending less than would be sustainable under the initial strategy.

Amidst this backdrop, financial advisors have several ways to help their clients meet their retirement spending goals while remaining confident in their income strategy. To start, advisors can offer options beyond fixed withdrawal rate strategies (e.g., a 'guardrails' approach) that offer more flexibility (and the potential for higher initial withdrawal rates, at the risk of future spending declines if market performance deteriorates). Further, given that the clients will be meeting with their advisor regularly over the course of their retirements (and therefore don't have to make a single retirement income strategy decision), those concerned about a Monte Carlo analysis result of less than 100% for a particular strategy can take heed that their advisor can propose adjustments along the way that can mitigate the chances of actual portfolio depletion (perhaps suggesting that even a 50% Monte Carlo success result could be viable). Which could ultimately allow clients to have more fulfilling retirements and greater peace of mind in the process!

8 Ways To Help Clients Stop Worrying About Running Out Of Money In Retirement

(Sheryl Rowling | Morningstar)

While retirement is often described as one's 'golden years', a time to relax, travel, and spend more time with family and friends after a long career, it can also be a period of uncertainty, particularly when it comes to generating retirement income amidst unknown future market and inflationary environments. Which could cause some individuals to enjoy their retirement less by attempting to be maximally conservative against running out of money.

Nevertheless, there are several moves that individuals can make both before and during retirement (perhaps with the support of a financial advisor) to provide for greater peace of mind that their retirement spending will be sustainable. For instance, individuals can 'insure' against potential major hikes to their spending, whether literal insurance against long-term care needs or a cash 'bucket' that can allow an individual to spend during a market downturn without having to sell assets that have declined in value. For those retirees worried about the potential for tax rate increases to diminish their spending power, contributing to Roth accounts (or engaging in [partial] Roth conversions) can 'buy out' the risk of future tax surprises by paying taxes at known rates today.

Individuals can also consider diversifying their retirement income streams beyond their portfolio. This could include increasing the amount of guaranteed income they receive by delaying Social Security benefits and/or purchasing a single-premium immediate annuity. Another (perhaps less considered) source of liquidity could be the client's home, whether through a future sale (if needed) or perhaps a reverse mortgage. And for those individuals who feel greater peace of mind with the backing of data, recognizing that a chosen retirement income strategy has been tested against historical data, that certain strategies provide for adjustments that can mitigate the chances of portfolio depletion, and acknowledging findings that inflation-adjusted spending tends to decline over much of an individual's retirement could boost their confidence.

In the end, individuals nearing and in retirement aren't passive participants in this life transition, but rather have many tools at their disposal to experience a financially secure retirement. And with a financial advisor at their side (who could raise several of these tactics that a client might not have considered themselves), they could gain greater confidence that they will remain on track to achieve their goals throughout their 'golden years'.

The War Is Over. Human Advisors Won.

(Josh Brown)

The early 2010s saw the rise of so-called "robo-advisors" that offered consumers algorithm-based investment management at a fraction of the cost that most human advisors charge (and without the sometimes-steep minimum asset requirements human advisors maintain as well). Which led some industry observers to predict that consumers (particularly younger, digitally native individuals) might turn towards digital solutions rather than human advice (though others predicted robo-tools wouldn't be a threat for advisors engaging in comprehensive financial planning).

However, the real-life experience since the early days has shown that human advisors not only survived the introduction and eventual proliferation of robo-advice solutions (both from robo-specific companies and large asset managers that created their own robo-solutions), but have thrived since that time. Recent years have seen the primary robo players pivot their business models (with Betterment shifting to become a multifaceted asset manager, 401(k) provider, and RIA custodian and Wealthfront now earning a significant portion of its revenue from client cash management) and some asset managers pulling back on their robo businesses.

A key question, then, is why human advisors prevailed so decisively against their robo counterparts. To start, while robo tools could provide asset allocation services (alongside features such as identifying tax-loss harvesting opportunities), they couldn't provide the breadth of services offered by human advisors (and, within portfolio management, the human reassurance often needed during turbulent markets). In addition, robo-advisors faced issues with high client acquisition costs, which were harder to recoup given the relatively low fees they charged (and the relatively low account balances of users on their platforms on which these fees could be charged). Also, the technology that powered robo-advice offerings became available to financial advisors as well, allowing them to spend less time on portfolio management that could instead be used to provide deeper client service in other areas (further increasing their value proposition in the process).

In sum, human advisors (particularly those offering comprehensive planning services that robo-tools can't provide) have emerged victorious in the robo-advisor revolution, continuing to amass clients and assets while taking the best parts of robo technology to improve their services. Nonetheless, with the prospect of financial advice provided by Artificial Intelligence (AI) tools, human advisors will likely need to continue to show how they offer unique value for their clients that can't be matched by a digital solution (perhaps in part by leaning into the areas where individuals prefer a human touch, such as creating personal connections and deeply understanding the scope of their clients' goals) while perhaps leveraging AI capabilities to become a "cyborg advisor" who can provide a deeper level of service by gaining efficiencies from using AI tools for various tasks that don't require interpersonal communication.

The Life Events That Clients Are Least Prepared For (And How Advisors Can Help)

(Alisa Wolfson | MarketWatch)

Individuals often seek out an advisor when they face an acute 'pain point', such as entering retirement or receiving an inheritance (and not knowing what to do with it). While advisors typically are adept at supporting clients through these situations, advisors' long-term value can emerge over time in part by helping clients prepare for other contingencies they might not have previously considered.

For instance, many clients might not have considered the impact of a future disability that prevented them (or a spouse) from working, presenting the opportunity for an advisor to discuss different ways to insure against this risk. Similarly, clients might not have considered their potential long-term care needs and how it will impact their finances, leaving room for advisors to initiate this conversation and help clients create a plan before they are potentially forced into making a decision. Other potential financial exposures aren't health-related, including lawsuits (perhaps covered with umbrella insurance for individuals and suitable legal structures for business owners), divorce (and how it would impact an individual's financial plan), and the loss of a job (as clients might underestimate the amount of time [and financial resources] it will take before they can secure a new job).

Altogether, an advisor's value is not just in providing support on issues that are on top of a client's mind, but also in ensuring they are aware of (and prepared for) contingencies they might not have considered. Which suggests that a combination of 'offensive' (e.g., creating a savings plan and appropriate asset allocation) and 'defensive' (e.g., ensuring proper insurance coverage and preparing for income-loss contingencies) tactics can provide clients with the support they need to weather the wide range of contingencies they might encounter during the (hopefully many) years they work with their advisor.

101 Ways Financial Advisors Can Add Value (And Why An Individual Advisor Doesn't Need To Offer All Of Them)

(Nerd's Eye View)

Traditionally, investment planning has been at the forefront of how financial advisors add value for their clients. But, with the rise of index funds and the commoditization of investment advice, generating sufficient investment 'alpha' to justify a fee has become more challenging for advisors. Combined with growing advisor (and consumer) interest in comprehensive financial planning services, the number of ways advisors can add value for their clients has expanded greatly.

When an advisor is thinking about their value proposition for clients, they might be tempted to list as many planning value-adds as they possibly can (to reach the broadest possible base of potential clients). But this can create challenges for the advisor as well, as they will have to spend significant time managing the variability of the planning needs of their diverse client base. An alternate approach, however, is for the advisor to focus their client service proposition on the planning needs of a specific target client, which not only increases the efficiency of the planning process, but can also facilitate marketing efforts as prospects who fit the target profile will be most attracted by the depth and specificity of the advisor's planning services!

To start crafting the persona of their ideal client, advisors can list key attributes of their target client. For advisors at established firms, this could mean thinking about their top clients, while those starting new firms could think about the type of clients they would like to serve. Client differentiators could include age, occupation, personal affinities, professional affiliations, and other criteria. The key is not necessarily to narrow down to a specific niche that meets every trait of the 'ideal' client, but rather to generate a sample persona that allows the advisor to start thinking about their 'ideal' client's planning needs.

Once an advisor has a better idea of who their target client is, they can then consider how to tailor their value proposition to those clients. Because the advisor's target client will probably only have certain planning needs (and may not require others), advisors can offer the value-adds from the hundreds of options available that best serve this target client. By applying the ideal-target-client framework, advisors can not only better target their marketing efforts (as they can align their website and other advertising efforts with their ideal client's needs), but they can also streamline their day-to-day work, as they will encounter fewer 'new' issues as their client base grows.

Ultimately, the key point is that while there are more than 100 different ways to add value to their clients' lives, the most successful advisors are likely to be those who are able to go deeper into the areas that are most important for their specific clients. In fact, by crafting an ideal target-client persona and shaping their service offering around the value-adds that most apply to these clients, not only can advisors enhance their efficiency, but they can also better differentiate themselves from more generalist firms, potentially leading to more efficient marketing and greater client growth in the long run!

Does Work-Life Balance Make You Mediocre?

(Cal Newport)

Recent years have seen the rise of 'hustle culture', where individuals (often proudly, and publicly) work lengthy hours each week as they seek to achieve major success (and wealth) in a startup or other business endeavor. Though, given the physical and mental toll that such a regimen can take on an individual over time, an important question is whether putting in abnormally long hours is required to achieve significant accomplishments.

Amidst this backdrop, Newport suggests that there is a key differentiation between what he calls "hard work" and "hard to do work".  "Hard work" refers to tasks that not only require many hours (or days) to complete, but, perhaps more importantly, require significant focus to do well. Notably, though, completing "hard work" doesn't necessarily require an individual to work an excessive number of hours each day over an extended period of time ("hard to do work"), but rather using the hours they do work well, focusing on the task at hand and avoiding distractions. Which means that individuals can potentially achieve major accomplishments while maintaining a relatively 'normal' work schedule.

In the end, while bragging about working a certain number of hours a day/week/month might appear to show dedication and commitment to achieving a significant goal, the quality of the time spent working could be even more important, potentially opening the door to achievement without detracting from one's health and other interests.

Give Yourself Permission To Prioritize Pleasure

(Oliver Burkeman | The Guardian)

There is no shortage of purported 'hacks' to help individuals avoid distractions, eat healthier, or overcome various 'vices'. While these often involve depriving oneself in some way, Burkeman suggests an alternative approach that (appealingly?) focuses on prioritizing pleasure.

For example, there are plenty of tools and tactics to reduce the number of available distractions related to smartphones (which can eat into one's personal time and professional productivity). However, while these might help provide a boost to willpower in the short run, they might not be sustainable in the long run. A different approach to avoiding these distractions is to engage in an activity that is more enjoyable and engaging than the smartphone, whether it's finding a new hobby, exercising, or simply reading a printed book. Similarly, while there are different 'tricks' to get yourself to eat healthier (e.g., keeping a favorite snack out of reach or out of the house entirely), a different solution is to explore healthier styles of cooking that might be enjoyable to explore (and lead to meals that are so satisfying that you don't think about the snack).

In sum, while peak productivity and the ability to engage in delayed gratification can sometimes be worthwhile, most people want to live a life that is enjoyable. Which could mean engaging in activities that generate pleasure, because while they might take time and energy they could ultimately lead to a more fulfilling life (and perhaps better behaviors in the process?).

The Discipline Of Stepping Away

(The Financial Pen)

While professionals typically look forward to their next vacation in theory, actually taking time away from the office and one's normal routine sometimes be disconcerting (with some research finding that individuals in challenging situations [such as those who had an extended hospital stay or who were previously incarcerated] find it hard to adjust to their newfound freedom given the disruption to their previous routine). For example, someone taking a week off in the middle of a major project might be concerned that they will lose momentum or need significant time to ramp back up once they return to the office.

However, some research suggests that taking time away from work not only can provide (often much-needed) rest, but also can expand one's horizons, all while picking back up where one left off upon returning to the office. For example, prolonged time focused at work can lead to "cognitive depletion", which research shows can lead to myopia, impulsivity, and poor probabilistic reasoning. Stepping away from this mental strain can lead to a more natural state of homeostasis, which is associated with improved decision-making and greater bandwidth to take on future tasks.

While the restorative benefits of stepping away might be tempting, some might still worry that they will be slow to pick back up the in-progress projects they left behind. Nonetheless, two psychological phenomena suggest this might not be the case. To start the "Zeigarnik Effect" finds that the mind holds unfinished tasks in a state of heightened vividness, or a mental bookmark that keeps the task alive (while completed tasks take up less mental bandwidth). Further, the "Ovsiankina Effect" recognizes that humans have a natural inclination toward completion, which can provide momentum for unfinished work. This pairing suggests that one can frequently pick up where they left off after returning from a break.

Ultimately, the key point is that while it can be tempting to keep up momentum and keep 'grinding', taking time away from work can provide needed relaxation and expanded headspace without necessarily derailing key projects in progress.

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