Archives Of Weekend Reading For Financial Planners

Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that a recent survey by Charles Schwab of RIAs on its platform finds that many firms are looking beyond AUM to track their growth (at a time when market-driven AUM growth can hide possible organic growth challenges), with new client headcount, client referrals, and AUM-per-household emerging as popular data points. In addition, at a time when offering comprehensive planning services has become more common amongst advisory firms, RIAs appear to be leaning into providing exceptional client service and building a trusted reputation to differentiate themselves.

Also in industry news this week:

• Schwab executives this week offered updates on a variety of hot-button issues for RIAs on its platform, addressing its cash sweep program, lending offerings for clients, and advisor suspicions that the custodian is also acting as a competitor in part through its newly opened wealth management offices
• The SEC has released its 2027 examination priorities, which include a focus on Artificial Intelligence, both in terms of firms' use of AI-powered tools and AI-enabled cyberthreats to client data and assets

From there, we have several articles on investment planning:

• How the relative strength of large-cap U.S. stocks in recent years has led some investors to fall into a 'coretex', (perhaps unintentionally) overweighting this market segment
• A research study examines the potential benefits of diversification not only amongst different investment factors, but also in the measures used to select investments within them
• How a "tolerance band" approach to rebalancing could reduce the number of rebalancing trades needed while keeping a portfolio largely aligned with its target asset allocation

We also have a number of articles on education planning:

• A rundown of several recent changes to the student loan environment that went into effect this year, including annual and aggregate loan limits and changes to repayment programs
• How financial advisors can help clients plan for the tax implications of student loan forgiveness
• Why some students (and their parents) are turning to the private student loan market amidst new restrictions in federal student loan lending (and how advisors can help clients assess their options)

We wrap up with three final articles, all about travel:

• A look into the cat-and-mouse game between credit card issuers and those looking to maximize their points and miles earnings
• While travel is often a stated goal of those entering retirement, looking deeper into the 'why' behind this ambition could lead to a more fulfilling experience
• How travelers can ease their way through airports using VIP packages that offer a smoother ride (for a price)

Enjoy the 'light' reading!

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Enjoy the current installment of “Weekend Reading For Financial Planners” – this week’s edition kicks off with the news that a recent survey indicates that investor trust in human-provided investment advice increased, while trust in Artificial Intelligence (AI)-powered investment advice declined, compared to the prior year’s results. Further, the survey found that while relatively younger clients were more likely to trust AI-provided advice than their older counterparts, this group also experienced a sharp drop in trust in AI advice during the past year (perhaps as they have more exposure to its strengths and weaknesses?). Which, altogether, suggests that investors appear to continue to impose a ‘trust penalty’ on AI advice platforms, giving human advisors the opportunity to lean into what they do best, from building trust in personal relationships to giving clients the sense that they maintain control in the relationship. 

Also in industry news this week: 

• The IRS recently finalized rules for the car loan interest deduction introduced in the One Big Beautiful Bill act, offering financial advisors the opportunity to add value by helping clients determine whether they might qualify for it and, at a broader level, whether financing a new car purchase is the best course of action given their personal circumstances 

• A survey indicates that individuals with a financial advisor are much more likely to have a plan in place to address a potential long-term care need and shows how the impact of care responsibilities (both in terms of time and money) can frequently fall on loved ones 

From there, we have several articles on tax planning: 

• Why ‘filling up’ a client’s current tax bracket isn’t always an optimal strategy when it comes to making (partial) Roth conversions 

• The circumstances when a client might want to incur more taxes this year in return for a lower tax bill down the line (and the hurdles advisors might have to overcome to implement a related planning strategy) 

• An analysis of the expected after-tax accumulation of traditional versus Roth retirement account contributions and how it relates to the variance of the ultimate results  

We also have a number of articles on practice management: 

• A five-step framework for handling fee objections, from acknowledging the prospect’s concerns to giving them room to make a decision 

• A one-sentence response advisors could use when prospects hesitate about an advisor’s fee that avoids the appearance of defensiveness and allows for a deeper investigation of the prospect’s underlying concerns 

• How financial advisors can communicate (the necessity of) fee increases with a value-centric, client-based approach 

We wrap up with three final articles, all about the benefits of experimentation: 

• How financial advisors can help clients prepare for retirement and other goals by encouraging experiments that allow them to see what the future might be like without going all in 

• How engaging in experiments could be more effective (and productive) compared to setting major (challenging) goals in many parts of life, from careers to health and relationships 

• Why failure can be a competitive advantage for firms that are willing to experiment, be open to feedback, and apply the lessons of ‘failed’ initiatives 

Enjoy the ‘light’ reading! 

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week’s edition kicks off with the news that a survey by Vanguard of investors on its platform found that many of those who have engaged with Artificial Intelligence (AI) tools for money management or planning actually value their (human) advisor more because of these interactions, with very few indicating the opposite. Further, while the broader pool of investors surveyed appeared to largely use AI for quick (and free) answers to questions, there was significant discomfort amongst respondents when it comes to letting AI act on their behalf. Which suggests that while the ultimate level of ‘competition’ from AI for human advisors continues to develop, advisors who are able to lean into what makes them human (e.g., forging a deep understanding of their clients’ situations) as well as serving as a trusted source of information and reliable actor when it comes to executing decisions could see greater interest from prospects and loyalty from clients in the years ahead.

Also in industry news this week:

• The Social Security Administration announced this week that the annual cost of living adjustment for 2027 will be 3.6% (though potential changes to shore up the Social Security system could end up playing a larger role in seniors’ long-term finances)
• Congress has passed legislation that would change the names of key ages related to claiming Social Security benefits, linking them more closely to the size of benefits received

From there, we have several articles on Required Minimum Distribution (RMD) planning:

• 10 common RMD mistakes (and how financial advisors can help clients avoid them), from challenges in correctly coordinating RMDs across accounts to errors made when leveraging the ‘still working’ exception
• The pros and cons of taking RMDs at the beginning, end, or throughout the year
• Why the mechanics of taking RMDs for recently inherited IRAs can differ by custodian and lead to challenges for beneficiaries

We also have a number of articles on investment planning:

• An analysis of historic asset class performance when bond yields spike suggests that while there tends to be short-term pain for longer-maturity Treasuries, there could be some light at the (unknown) end of the tunnel
• Why investors might consider rebalancing at a time of higher bond yields and when many portfolios likely have veered from their target asset allocation
• While some investors might be tempted by the current yields offered by longer-maturity Treasuries, cash-like instruments could provide a more attractive risk-reward balance for assets needed to cover shorter-term expenses

We wrap up with three final articles, all about being a better conversationalist:

• While some individuals dislike ‘small talk’, research suggests it can provide professional and community-building benefits
• Strategies to make yourself easier to talk to, from making a clear introduction to offering intriguing details about your life
• 13 questions advisors can use to better get to know new clients and their planning needs

Enjoy the ‘light’ reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that Fidelity is planning to raise its minimum asset threshold for RIAs on its platform to $100 million, with affected firms having until June 30, 2027 to reach this minimum or start the process of finding a new custodial home. While this move is already leading to competition amongst other RIA custodians to serve the (few hundred) affected firms, more broadly it demonstrates the consequences of the current RIA custodial model (where neither RIAs nor their clients pay a direct fee to the custodian but rather 'pay' through the services clients use [e.g., relatively low-rate cash sweep accounts and lending products]) and suggests that an approach with more explicit fees could potentially serve custodians, RIAs, and individual clients alike.

Also in industry news this week:

• The Securities and Exchange Commission (SEC) this week released a new examination handbook that offers fresh insights into how it determines which RIAs to examine each year
• The SEC also released a proposed framework for advisor custody of clients' cryptoassets, which could provide greater assurance for advisors interested in doing so

From there, we have several articles on Health Savings Accounts (HSAs):

• Why having an HSA 'succession plan' can help avoid the loss of attractive tax benefits associated with these accounts
• While the types of services and products eligible for reimbursement using an HSA might be broader than many clients expect, pushing the boundaries could lead to undesired penalties
• How families can execute an HSA "deathbed drawdown" to get assets out of an account in a hurry and avoid negative tax repercussions when an HSA is inherited by a non-spouse individual

We also have a number of articles on the elevated interest rate environment:

• Strategies for families to support children or grandchildren with the purchase of a home amidst elevated home prices and interest rates, including intra-family loans and disclaimers
• A recent study finds that a significant portion of homebuyers are ending up with higher rates and mortgage costs by not shopping around (with those with higher income and credit scores particularly prone to do so)
• An in-depth look into how financial advisors can support clients deciding whether to pay points to receive a lower interest rate on their mortgage

We wrap up with three final articles, all about wealth:

• Recent data indicate that the wealth of the top 0.1% of households has diverged from that of those in the next wealth bracket, creating a subgroup of astronomically wealthy households
• While the wealthiest households in the United States have seen their net worth soar during the past decade, those further down the wealth spectrum (including those in younger generations) have seen gains as well (perhaps opening new opportunities for financial advisors)
• How the difference between absolute and relative wealth (and the relationship between income and wellbeing) can be instructive at a time when certain individuals have seen their wealth explode

Enjoy the 'light' reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that the IRS issued guidance and a revenue ruling drawing boundaries around what it perceives to be legitimate uses of the increasingly popular 351 exchange strategy. While the strategy as a whole remains a viable way to manage securities with large embedded capital gains, the agency warned against certain tactics within ETFs leveraging it, including the rapid turnover of contributed securities, seed baskets that don't match the ETF's stated strategy, and transactions that appear pre-arranged. Which suggests that advisors can support clients not only in considering this strategy when appropriate but also in evaluating funds to ensure they will stay on the right side of IRS guidelines (and avoid a potential negative tax surprise for their clients in the process).

Also in industry news this week:

• The Treasury Department announced this week that it auto-enrolled more than 60 million children in the "Trump Accounts" program (though parents still need to claim the accounts to access available government and philanthropic contributions to them)
• A recent survey suggests a valuable role for financial advisors in helping hesitant clients (with the means to do so) spend more in retirement

From there, we have several articles on tax planning:

• Four mistakes related to IRAs that can't be undone (and how advisors can help clients avoid them), with indirect rollovers being a major culprit
• Why October 15th represents a key deadline for several transactions related to IRA contributions
• While the Federal government is in the midst of modernizing the IRA rollover process, advisors continue to have a valuable role to play in ensuring rollovers of workplace retirement plan assets are completed correctly (avoiding negative tax consequences in the process)

We also have a number of articles on marketing:

• The content, activity, and strategies that help advisors connect with prospective clients on LinkedIn
• A "3-2-1 Method" for consistent (but not necessarily time-intensive) engagement on social media
• How financial advisors can scale their social media marketing by leveraging evergreen content

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

• How thinking (and writing) for oneself can help professionals stand out at a time of increasing use of AI for these activities
• Why "cognitive delegation" in the workplace could make it harder to attribute original work to up-and-coming employees
• Seven principles for writing with (and without) AI, including the importance of maintaining an original voice

Enjoy the 'light' reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that a survey indicates many financial planning clients are concerned about rising consumer costs, with healthcare expenses at the forefront. Which suggests financial advisors have the opportunity to offer value both by increasing their clients' confidence in their financial plan (e.g., by stress testing it for different inflationary environments) and by recommending adjustments that are supportive of their long-term goals (while avoiding potentially reactive, short-sighted moves that clients might consider in this environment).

Also in industry news this week:

• More than half of advisor respondents to a recent survey who use AI tools in their practices indicated that they are saving at least four hours per week from doing so, with advisors at RIAs leading the way on adoption
• RIA M&A activity is on track to see a downturn in the third quarter after experiencing a brisk pace during the first half of the year, possibly reflecting firm owners' desire to focus inwards on client service amidst economic volatility

From there, we have several articles on retirement planning:

• How safe withdrawal rates change when a retiree is looking well beyond a 30-year time horizon
• Why a particular individual's safe withdrawal rate can be harder to calculate than it might seem (and how advisors can provide significant value through ongoing plan monitoring)
• Actions advisors can consider to reassure clients who are nervous that they might be retiring at a market peak

We also have a number of articles on insurance planning:

• Analyzing the available options for individuals to maintain health insurance coverage after being laid off
• Why a job loss in one's 50s or 60s can be particularly financially burdensome (including the challenge of finding affordable health insurance coverage) and how advisors can help clients prepare for this contingency
• How financial advisors can use income planning to help clients qualify for premium tax credits when using an Affordable Care Act marketplace plan for their health coverage

We wrap up with three final articles, all about recent consumer trends:

• How it has become increasingly difficult to determine the true cost and value of a particular good amidst the rise of "shrinkflation", "skimpflation", and the loss of brand identity
• How consumers end up paying an indirect 'tax' when product marketplaces have manufacturers pay to receive top placement on their search results
• While consumers might identify troublesome trends that have emerged in recent years, taking a broader outlook can reveal the "ordinary abundance" that is ubiquitous today but would have been limited to only the wealthiest individuals in the past

Enjoy the 'light' reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that Anthropic announced an advisor-specific plug-in to its Claude tool, which will incorporate data from many key advisor tech tools. While the new "Claude for Financial Advisors" plug-in offers the potential to solve the long-simmering problem for advisors of integration across tools in their tech stacks, it also raises questions, including how advisors will use any time savings gained from leveraging the tool and whether these activities can create a positive ROI for the usage-based fees Anthropic charges.

Also in industry news this week:

• A survey finds that it's still early innings for many advisors in terms of their AI use, and a strong majority of respondents are seeking more time for prospecting and deepening client relationships despite the tech investments they've made
• Only 3% of clients would replace their human advisor with an AI tool, according to a recent survey, though a higher percentage have considered changing their advisor for other reasons (with communication frequency and digital presence appearing to be key factors for younger clients)

From there, we have several articles on tax planning:

• When comparing the tax benefits of donating appreciated securities versus making a Qualified Charitable Distribution (QCD), the QCD often comes out on top
• Although the IRS's introduction of a new code for custodians to report Qualified Charitable Distributions (QCDs) on 1099-R might make it easier for taxpayers to report QCDs on their tax returns, custodians might not always report those QCDs consistently, meaning it's still up to the IRA owner to make sure that what's reported on their tax return matches the contribution they made in reality
• While many advisors recommend clients convert most or all of their pre-tax retirement accounts to Roth, doing so means losing the opportunity to make Qualified Charitable Distributions (QCDs) from a pre-tax IRA – meaning that if the client has charitable intentions, they end up paying tax on the converted dollars when they could have been distributed to charity tax-free as a QCD

We also have a number of articles on generating client referrals:

• How newer firm owners can move beyond their personal network to create a sustainable referral engine
• Why getting a client to refer a friend or family member is only the first step in them becoming a client, with a firm's online presence potentially playing a major role in the referred individual's decision to move forward as well
• How advisors can generate more unsolicited referrals that actually turn into good-fit clients

We wrap up with three final articles, all about retirement lifestyle:

• A recent study ranks the best and worst states and cities for retirement based on 46 indicators falling within the broader categories of affordability, quality of life, and health care
• How retirement presents an opportunity for individuals to enjoy a slower-paced, more analog lifestyle
• While engaging with the arts can be an enjoyable activity in its own right, a recent study suggests doing so could come with health benefits as well

Enjoy the 'light' reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that a recent survey from Vanguard investigates the perspectives of men and women when it comes to investing and working with a financial advisor, finding in some cases that assumptions about these groups might not always hold. Overall, respondents expressed greater confidence in making a range of financial decisions when working with a financial advisor, though women who had left an advisor were most likely to cite the advisor not working in their best interest as the reason for doing so. Both men and women expressed a range of preferences in terms of communication styles from financial professionals, with an educational approach topping the list for women and a data-driven/analytical approach leading for men (though the preference gaps for men and women on individual styles weren't particularly large). Which, altogether, demonstrates the value of exploring each prospect's and client's unique goals and preferences, as they very well might diverge from an advisor's assumptions.

Also in industry news this week:

• An examination of Form ADV filings finds that firms that disclosed AI use actually saw higher staff headcount growth, indicating that for a subset of firms AI adoption is intended to complement, rather than supplant, human team members
• While the SEC under chair Paul Atkins appears to be less interested in pursuing broad enforcement actions related to advisory firms' use of off-channel communications with prospects and clients than in years past, an attorney and former SEC official suggests that implementing and enforcing policies toward electronic communications (and their storage) could help firms avoid client harm (which could make them subject to an enforcement action) or, in the case of broker-dealers, continued FINRA scrutiny of communication failures (even if no client harm has occurred)

From there, we have several articles on retirement planning:

• An analysis of Social Security claims data and self-reported health amongst retirees finds that those who are in poorer health tend to claim Social Security earlier (in many cases, correctly identifying a shorter expected lifespan)
• While wealthier individuals often are able to delay claiming Social Security benefits (to receive their maximum monthly benefit), those who are particularly wealthy might choose to claim earlier to fund insurance policies that could, amongst other purposes, help heirs pay for estate taxes owed
• How the ability to claim six months of retroactive Social Security benefits after reaching Full Retirement Age can both be an opportunity (by giving a client more confidence in delaying benefits) and a potential trap (by having a permanently lower monthly benefit if retroactive lump-sum benefits are taken)

We also have a number of articles on client communication:

• How financial advisors can support clients in riding the 'waves' of emotion (both positive and negative) that can arise during meetings
• A step-by-step framework for working with a client who has recently experienced the loss of a spouse to both give them space to grieve and to prepare them to make key planning decisions
• Strategies for advisors when working with a client experiencing "ambiguous loss", such as a loved one suffering from dementia

We wrap up with three final articles, all about the tradeoffs of being a 'maximizer':

• How certain tax planning strategies could lead to a lower lifetime tax bill but also less enjoyment of one's wealth
• Why much of one's health and financial success is determined by getting the 'big things' right and how trying to optimize for the rest could lead to greater stress
• The value of jumping off the "hedonic treadmill" and taking a step back to recognize when key goals have already been met

Enjoy the 'light' reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that a survey has found that, at a time when many financial advisors are leaning into comprehensive wealth management services, more than half of RIA client assets amongst respondents are invested in model portfolios. That said, advisors aren't necessarily taking a hands-off approach to portfolio construction, with advisor-built models representing the most commonly used (51% of model assets), followed by home-office models (20%), standard third-party models (17%), and third-party custom models (12%). Which suggests that many advisors are seeking ways to free up time to focus on other planning (and business management) responsibilities while remaining 'hands-on' with the investment management process.

Also in industry news this week:

• A significant increase in the minimum asset size for referrals in Charles Schwab's Advisor Network program could lead some firms to reevaluate their participation (and perhaps their overall custodial relationship with Schwab)
• The SEC this week submitted a proposal that would expand retail investor access to private market investments that have long been the purview of institutional and wealthier investors

From there, we have several articles on retirement planning:

• How safe withdrawal rates can increase significantly as retirees' time horizons shorten
• How putting a financial plan for a retired couple through a 'widowhood stress test' could identify potential weaknesses when one spouse (unexpectedly) passes away
• Why some retirees might gain peace of mind by creating an asset 'bucket' for potential long-term care expenses

We also have a number of articles on practice management:

• A five-step process to better delegate 'outcomes' within an advisory firm (and why doing so could be more impactful than 'just' handing off individual tasks)
• Ways advisory firms can integrate new planners into client meetings, from identifying good-fit clients to leaning into their cash flow expertise
• Six ways firms can get a faster return on investment from a new associate advisor, including by delegating responsibilities in areas such as client onboarding and plan updates

We wrap up with three final articles, all about the costs of home ownership:

• How financial advisors can help clients consider whether to follow through with a major home remodel, from identifying the tradeoffs from making such an outlay to determining the best source of assets to pay for it
• While many homeowners enjoy having green space on their property, lawn upkeep can come with significant 'hidden' expenses
• How prospective home buyers can conduct due diligence on a homeowners or condo association to avoid stress and save money down the line

Enjoy the 'light' reading!

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Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that Vanguard is planning to acquire RIA custodian Altruist and how it is likely to send ripples across the wealth management and asset management spectrum. While it immediately provides Altruist with the backing of an enormous asset management firm and Vanguard inroads into the RIA custodial space with a tech-forward offering, it could also put pressure on the largest RIA custodians Charles Schwab and Fidelity to up their level of service in the competition for RIA business and provide a boost to certain ETF providers looking to distribute their products to RIAs while avoiding fees charged by the major incumbent custodians.

Also in industry news this week:

• Consumers are prioritizing trust when it comes to selecting a wealth management provider, according to a recent survey, with service and fee transparency, as well as identity and account security, being key contributors to demonstrating this attribute
• Member satisfaction with Medicare Advantage plans dipped for the second straight year, according to a recent survey, highlighting the value of financial advisors in helping clients select the best Medicare option for their needs (and in making a change when necessary)

From there, we have several articles on investment planning:

• Evaluating the types of clients who could benefit the most from investments in Treasury Inflation-Protected Securities (TIPS) at a time when long TIPS offer real yields greater than 3%
• Why it's important to keep a client's investment time horizon in mind to avoid surprises when choosing individual TIPS or investing in a TIPS fund
• How advisors can incorporate inflation trends into portfolio management conversations with clients

We also have a number of articles on advisor marketing:

• How Facebook advertising campaigns can provide flexibility and data to inform a firm's broader marketing approach (but might not produce instant leads)
• How firms can use geographic market data to determine whether to emphasize a local SEO strategy or one focused on an ideal client type
• Four ways advisors can appear more often (and authoritatively) in AI answer engine search results

We wrap up with three final articles, all about next-generation wealth:

• Why some wealthy parents are sending their young adult children to retreats where they can learn about wealth stewardship and compare experiences with peers
• The growing popularity of (sometimes high-cost) 'gap years' and how they fit alongside college plans
• While many parents are worried that financial transfers to adult children might reduce their motivation, creating an income 'floor' could help them pursue a meaningful life path

Enjoy the 'light' reading!

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