Enjoy the current installment of “Weekend Reading For Financial Planners” – this week’s edition kicks off with the news that despite concerns from fiduciary advocates that the Department of Labor’s new “fiduciary” rule will undermine consumer protections by allowing “fiduciary commissions”, the annuity industry is mounting a challenge to the rule out of a concern that it is still too stringent in attaching a higher standard of care to sales of annuities into IRA rollovers, raising the question of whether a final rule will be issued in the coming months or not (and if it is, whether it will again be challenged and struck down as the last DoL fiduciary rule was).
Also in the news this week are some interesting new industry studies, including a look at the growing interest from industry providers to gain adoption of Health Savings Accounts amongst financial advisors to use as a supplemental retirement savings account for more affluent clientele, and another study finding that 44% of investors (and 68% of Millennials) would consider switching away from an advisor who did not align with their political views (stoking fears amongst some advisors that political discussions will cause lost clients, but signaling an opportunity for others that being more upfront about the advisor’s politics can actually better bind clients who share similar political views).
From there, we have a few articles on industry trends around advisor platforms, including a veritable explosion of new recruiting efforts from broker-dealers that have transitioned to virtual recruiting (as it’s now easier to vet a new platform from the comfort of your home office!?), the ongoing tension that RIAs face in choosing which RIA custodian on whom they both depend and may compete with (as the Schwab-TD Ameritrade merger creates a veritable oligopoly of mega providers), and the options for advisors to consider if they don’t have enough in assets under management to affiliate with one of the mega RIA custodians.
We’ve also included a number of marketing articles this week, from a look at how anticipated SEC revisions to the advertising and (anti-)testimonial rules could create an upheaval in advisor marketing in 2021, how “expertise marketing” is different than traditional advisor marketing and is all about finding synergies that build compounding marketing momentum over time, and why it’s so important to consider the Client’s “Lifetime Value” and not just the top-line revenue growth of the firm to understand the health of an advisory firm and its marketing efforts.
We wrap up with three interesting articles, all around the theme of what clients really want from the advisor-client relationship: the first explores a recent Spectrem Group study that finds, despite the rise of robo-advisors and more and more online technology, that more consumers are relying on financial advisors now than in the aftermath of the financial crisis a decade ago (though at the same time, there has also been an uptick in self-directed investors relying on increasingly sophisticated technology solutions); the second provides an interesting perspective from the client’s point of view (literally, written by a client who has had many financial advisors over the years) on what really matters when it comes to client retention; and the last recaps a keynote session from this week’s Morningstar conference about how the future of the financial advice industry is changing, where the AUM model and in-person meetings won’t vanish, but a growing range of virtual meetings and non-AUM fee-for-service business models are opening new doors of opportunity to grow advisory businesses!
Enjoy the ‘light’ reading!