Kitces Research Spotlight

Exclusive Virtual Events Featuring Original Kitces Research

Kitces Research Spotlight

The February Research Spotlight has concluded. Sign up to be notified when the next Spotlight is announced.

This is a virtual event. Purchase of a pass includes: Access to the live event and Q&A, a full event recording, and an advanced copy of the latest Kitces Research Report.

Learn More SIGN UP TO GET NOTIFIED ABOUT OUR NEXT SPOTLIGHT

About Kitces Research Spotlight

The Kitces Research Spotlight is a virtual event series where Michael Kitces, along with Kitces Director of Advisor Research Mark Tenenbaum, share actionable insights from original research studies on the financial advice industry.

Each session is designed to provide deeper perspective on the trends shaping advisory firms today — with live Q&A and early access to the full research report.

Recent Research Spotlight Topics Have Included:

New Trends and Rising Stars In the AdvisorTech Landscape
Advisor Productivity Trends and Best Practices
Advisor Technology Trends and Opportunities
Improving Advisor Wellbeing To Reduce Turnover

Research Spotlight Attendees Receive

The Kitces Research Spotlight will provide further perspective on trends and opportunities of particular interest to enterprise leaders, investors evaluating advisory firms for acquisition, and professionals focused on developing advisor talent!

Access To The 60-Minute Live Presentation And 30 Minutes of Direct Q&A with Michael and Mark using the live chat

Full Event Recording

An advanced copy of the Kitces Research Report and Presentation Slides

*Single pricing event. No Premier member discount. Not a CE-eligible event.

The Hosts

In each session, financial advisor, industry consultant, and advisor researcher Michael Kitces, along with Kitces Director of Advisor Research Mark Tenenbaum, will share the results of the latest Kitces Research.

Michael Kitces

MSFS, MTAX, CFP, CLU, ChFC, RHU, REBC, CASL

Founder and Chief Financial Planning Nerd

Kitces.com

Mark Tenenbaum

Ph.D.

Director of Advisor Research

Kitces.com

Pricing & Sign-Up Information

Tuesday, February 10, 3:30-5:00PM ET

Cost: $500*

This is a virtual event. Join from anywhere and access a full recording to reference after the event.

Purchase of a pass includes: Access to the live event and Q&A, a full event recording, and a copy of the Kitces Research Report and Presentation Slides.

*Single pricing event. No Premier member discount. Not a CE-eligible event.

FAQs

Who is this webinar best suited for?

Enterprise leaders, investors evaluating advisory firms, firm owners, and professionals focused on advisor development.

Is there CE associated with this event?

This webinar spotlight is not CE-eligible.

Are there any discounts?

Each exclusive spotlight event has a single pricing structure of $500. Kitces Premier members are not eligible for a discount.

How often do spotlights occur?

Research Spotlights are hosted in February and August of each year and focus on newly released Kitces Research studies.

#FASuccess Ep 422: Developing Your Leadership Skillset On The Path From Intern To President Of A $13B AUM Enterprise, With Kay Lynn Mayhue

January 28, 2025 07:02 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Kay Lynn Mayhue Podcast Featured Image FAS

Welcome everyone! Welcome to the 422nd episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Kay Lynn Mayhue. Kay Lynn is the President of Merit Financial Advisors, a hybrid advisory firm based in Alpharetta, Georgia, that oversees approximately $13 billion in assets under management for 26,000 client households.

What's unique about Kay Lynn, though, is how she developed her advisory, management, and leadership skills to work her way up from starting as an intern to eventually become the president of a national RIA enterprise and lead their proactive mergers and acquisitions strategy.

In this episode, we talk in-depth about the ups and downs of Kay Lynn's evolution over the past decade from being a client-facing advisor to a firm leader (including the lessons she learned when once, early on, her team threatened to quit because of her original management style), how Kay Lynn grew to recognize the importance of connecting better with her team members as people rather than just focusing on business results and outcomes alone, and Kay Lynn's strategies today around asking peers and employees for feedback (which have helped her recognize blind spots in her leadership approach, even as she's now advanced to the highest management levels at her firm).

We also talk Kay Lynn's current role managing her firm's mergers and acquisitions activity (including how she and her business partner decided to sell their previous firm to Merit rather than go through their own internal succession), why Kay Lynn sees more value in selling firms when their G2 advisors are also equity owners, even if the founder is still planning an external sale in the long run (because it results in more of an ownership mindset in the selling firm's G2 advisors that helps them see the benefit of staying on to grow their equity further after the deal is closed), and why Kay Lynn places high importance on culture when evaluating potential firms to acquire (to ensure both the right fit for her firm… and a relatively smooth transition for the selling firm's team).

And be certain to listen to the end, where Kay Lynn shares how she incorporates the BehavioralDNA personality assessment both when hiring new employees and when working with clients, how Kay Lynn's firm offers "organic growth tracks" that allow its advisors to plug into potential sources of clients (such as firms with Employee Stock Ownership Plans and establishing partnerships with CPAs) and then execute in that channel with an established marketing playbook to grow their practices, and why Kay Lynn thinks it's important for advisors to reflect on the current phase of life they're in (for example, whether they have young children or are empty nesters) and structure their work according to that phase, to be able to achieve both their professional ambitions and their priorities in their personal lives over the long run.

So, whether you're interested in learning about charting a career path to eventually lead a large enterprise RIA, positioning a firm to attract a premium valuation when considering a sale, or how to incorporate personality assessments in the hiring and client onboarding processes, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Kay Lynn Mayhue.

Kitces & Carl Ep 156: How Are You Getting Value Out Of ChatGPT As A Financial Advisor?

January 23, 2025 07:02 am 0 Comments CATEGORY: Kitces & Carl Podcast

Kitces & Carl Ep How Are You Getting Value Out Of ChatGPT As A Financial Advisor

Since the emergence of Artificial Intelligence (AI) in the mainstream technological landscape, conversations about which areas of the financial planning industry would be most likely impacted by AI have proliferated. These discussions have ranged from questioning whether everyone would be out of a job in five years to wondering if anything of substance would change at all. However, as the public’s understanding of AI has developed, the common consensus has largely shifted to the understanding that while processes may change, the expertise and human connection offered by specialists like financial advisors will be hard to replace. In fact, AI currently seems most likely to develop into a tool that advisors can use in many parts of practice. Which, in turn, poses the question – where can AI be most effectively used as a way for advisors to leverage their time and creativity?

In the 156th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss how they use AI tools such as ChatGPT to expedite their creative and strategic processes – and how to ‘ask’ ChatGPT better questions to get more effective and relevant answers.

Perhaps one of the most impressive capabilities of programs like ChatGPT lies in their ability to serve as brainstorming partners. To use them effectively, it can be helpful to assign ChatGPT a role (e.g., “You are my executive producer” or “You are a marketing director”) and define a clear objective. Providing sample documents or links to sources for tone or substance may be helpful. For example, advisors can attach their typical “first prospect meeting” agenda, give ChatGPT the role of business development coach, and ask for feedback and what to do differently.

That being said, a common frustration when using ChatGPT or similar programs for brainstorming is that the first responses may not be exactly what is hoped for. Rather than expecting a perfect ‘call and response’, the process can be approached more as an iterative dialogue. Sharing initial thoughts, providing feedback, and curating further – such as asking variations of “I really like [this idea]; can you tell me more about it for an audience of [specific type of client]…?” – can guide ChatGPT toward more tailored results. The advisor and AI can then collaborate further to create a stronger and more relevant offering. Additionally, many AI programs now ‘remember’ what was asked of them across sessions, making it easier to build on previous conversations and reach increasingly insightful responses over time!

The key point is that with some patience and guidance, ChatGPT can be a powerful tool for enhancing many aspects of an advisory firm’s operations. Whether it’s used to help with marketing, drafting email responses, summarizing content, reviewing data analyses, or even providing feedback on client surveys, the potential applications are vast. Ultimately, the only true limitation of AI’s potential is ‘just’ a question of imagination!

22 Top Financial Advisor Podcasts To Listen To In 2025

January 20, 2025 07:01 am 0 Comments CATEGORY: Personal/Career Development

There is no shortage of written content available for financial advisors to enhance their technical skills, grow in their careers, and run more successful planning practices, from books to research studies to long-form written content. Of course, given the demands of their busy schedules , finding time to dig into this content can be a challenging endeavor.

Luckily, alongside the increasing popularity of podcasts on a seemingly infinite range of topics, there is a growing ecosystem of podcasts aimed at financial advisors, covering everything from practice management and career development to technical topics, such as investment, tax, and estate planning. Which gives advisors the opportunity to gain new ideas to improve their businesses (and careers) as well as stay on top of emerging planning opportunities while commuting, working out at the gym, or walking the dog.

Nonetheless, given the hundreds of available podcasts targeted to financial advisors, finding the 'best' ones for an advisor's specific needs can be a challenge. With this in mind, we have compiled a list of "Top Financial Advisor Podcasts", with a particular focus on how advisors can find the 'right' podcasts that fit their interests and business needs, whether they are aspiring financial planners or managing large enterprises. The podcasts are organized by category (e.g., practice management, behavioral finance), with each podcast capsule including a description of the type of advisor for whom the podcast is best suited.

Notably, this list highlights podcasts that we believe (based on our own listening!) offer a high signal-to-noise ratio and are tailored to the needs of those who are a part of (or hope to join) the financial advicer community (i.e., those who are in the business of selling their financial advice as opposed to financial products). Further, because choosing 'top' podcasts is inherently subjective (e.g., a financial advisor might find that they 'click' with the style of one podcast host over another covering a similar topic), we list a number of additional podcasts that are also worth checking out in each category for advisors who want to go deeper on a given topic.

With that introduction, we hope you enjoy our list of the 22 'top' podcasts for financial advisors!

Weekend Reading For Financial Planners (January 18–19)

January 17, 2025 02:00 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" – this week's edition kicks off with the news that at a time when brokerage firms' cash sweep programs come under increased scrutiny (and as the Federal Reserve has cut interest rates), Charles Schwab (the largest RIA custodian) continues to slash sweep rates for client cash (down to 0.05%), well below the rates available on other cash-like products, leaving advisors on the platform with the task of determining whether to move (at least some) client cash to higher-paying offerings (whether from Schwab or using emerging cash management platforms) to help clients earn more on their cash holdings and to ensure they are fulfilling their fiduciary responsibilities.

Also in industry news this week:

A recent survey indicates that members of Generation X are struggling more with retirement planning compared to older Baby Boomers and younger Millennials, potentially offering opportunities for financial advisors to help Gen Xers create a plan to 'catch up' when it comes to both their retirement savings and their financial confidence
According to a recent study, 37% of financial advisors are planning to retire within the next decade, opening up potential opportunities for the 48% of advisors who indicated interest in acquiring a practice

From there, we have several articles on retirement planning:

Research into a variety of flexible retirement income strategies demonstrates the tradeoffs between current safe withdrawal rates, cash flow volatility, lifetime spending, and legacy interests
An analysis suggests that those taking Social Security benefits early to invest them have a high breakeven rate to clear compared to those who delay benefits until Full Retirement Age or beyond
Why taking a systematized approach to determining a client's retirement income style preferences can help advisors offer a more personalized client experience

We also have a number of articles on advisor marketing:

How relatively smaller RIAs are pursuing organic growth at a time when M&A activity is receiving significant attention, from expanding the platforms (and audiences) they reach to refining their service models
Eight tips to help advisors get more "earned media" opportunities and demonstrate their expertise and credibility to prospective clients
Best practices for client events, including creating a sense of community and offering opportunities to gather feedback and preferences from clients

We wrap up with three final articles, all about managing stress:

How to keep up with the news without getting overly stressed, from deciding how deep to go into particular issues to setting time boundaries for news consumption
How regular self-reflection can help identify potential stressors and begin the process of moving past them
Why separating one's thoughts from one's sense of self can help avoid the stress that can arise from 'overthinking'

Enjoy the 'light' reading!

#FASuccess Ep 420: Making Financial Planning More Repeatable Without Losing The Customization Where Clients Prioritize What Matters Most, With Michelle Underwood Gass

January 14, 2025 07:04 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Michelle Underwood Gass Podcast Featured Image FAS

Welcome everyone! Welcome to the 420th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Michelle Underwood Gass. Michelle is the Founding Principal of Paradigm Advisors, an RIA based in Dallas, Texas, that oversees approximately $110 million in assets under management for 80 client households.

What's unique about Michelle, though, is the way she created a structured meeting process to navigate around the places where new clients often get stuck, standardized their experience in navigating through her deep planning process… and still retained a way to ensure that each client's financial plan focus and implementation is customized to their needs and prioritized for what they want to tackle first and foremost.

In this episode, we talk in-depth about Michelle's 5-part planning process, which starts with a "Get to Know You" meeting with prospects that includes some Life Planning exercises to both help Michelle understand what the client's real issues are and help the client understand Michelle's planning approach and whether a planning relationship would be a good fit, how Michelle begins onboarding new clients using a tech-enabled "Uncluttering" process that reduces friction in collecting and organizing clients' documents and financial information, and how Michelle holds what she calls an "Intrinsic Discovery" meeting to go deeper and really get to the heart of the client's values and goals.

We also talk about how Michelle then engages in a "Discovering Opportunities" process to highlight particular key planning opportunities for clients to pursue first (rather than just giving them a long list of recommendations) to avoid overwhelming her busy working-age client base and instead focus on the few issues that are most important to them, how Michelle leverages eMoney's Decision Center tool during the plan implementation process to help clients see the impact of different planning options and potential recommendations that Michelle is making, and how Michelle's firm uses workflow management software Hubly (which sits on top of her CRM) to ensure that planning tasks that require input from multiple firm stakeholders across the business are still completed efficiently.

And be certain to listen to the end, where Michelle discusses how she charges a flat planning fee alongside an AUM-based fee to be able to serve high-earning professionals who could benefit from Michelle's comprehensive planning process but might not yet have sufficient assets to be served profitably based on an AUM fee alone, how Michelle crafted a pair of specialities to serve two different ideal target clients (busy working-age professionals and relatively older hedge fund veterans who she knew from her previous life running her own hedge fund), and what led Michelle to decide to start her own financial planning business after (temporarily) retiring herself from managing a hedge fund… and has since found an even deeper sense of purpose in helping her clients live their best possible lives.

So, whether you're interested in learning about creating a structured meeting process to prevent new clients from getting 'stuck', how to use workflow management software to improve efficiency for tasks that require multiple stakeholders, or how to offer a planning offering and fee model that meets the needs of two different ideal client types, then we hope you enjoy this episode of the Financial Advisor Success Podcast, with Michelle Underwood Gass.

Rebuilding The Kitces Members Section And The State Of The (Nerd’s Eye View) Blog

January 13, 2025 07:01 am 0 Comments CATEGORY: Nerd's Eye View

With another strong year in the markets, most advisory firms are near or at record highs for their revenue, their numbers of clients, and the headcounts of their teams. Which is surprising to some, given that a decade ago, the emergence of so-called "robo-advisors" was supposed to displace human financial advisors and compress advisory fees. In reality, though, the robos struggled to gain traction, and the human financial advice business just continues to grow. To the point that now, ironically, the biggest emerging challenges for the profession are how best to leverage technology to further scale financial advice, and even with tech efficiencies, we may have an outright talent shortage as more and more advisory firms hit their client capacity wall and need to hire new advisor talent.

In a similar manner, the growth of Kitces.com over the past decade has led to capacity constraints, the need for an expanding team (which has already grown from 2 to 24 team members in under a decade!), and reinvestments into technology. And so we're excited to announce that, for 2025, our major company initiative will be a complete redesign and rebuild of our Members Section! Feedback from our Members has been clear that the navigation and user experience of our Members Section is one of the most challenging aspects of being a Member, and we fully recognize that the technology we use to power the Members Section, which was once cutting-edge, is now quite dated. Which means over the next 12 months, we're going to rebuild it all from scratch, with a modern technology foundation that will allow us to better scale over the next decade. (And also make it easier for us to redesign the Nerd's Eye View blog side of the website as well, in 2026!)

In addition to rebuilding the platform that runs Kitces.com, we're also making several updates to our content offerings for both Nerd's Eye View blog Readers and advicers who have joined our Members Section. After several years, we've decided to wind down our current Office Hours programs (Software Showcases and Advisor Makeovers), though the archives of our prior events will remain available to Members. However, this shift will free up time for us to focus on initiatives that we believe can have even more reach and impact!

Building on the back of our popular Advisor Technology Map and Directory, in 2025, we'll also be developing a new Advisor Services Map to make it easier to find whatever consultants, coaches, outsourcing partners, or other solutions advicers may be seeking (and like our AdvisorTech Map, will be openly available to the entire advicer community). We've also rolled out a new private community specifically for Directors of Financial Planning (DFPs), who are increasingly becoming the lynchpins that drive planning excellence in advisory firms… which is so in alignment with our own Kitces mission that we wanted to start hosting a community for DFPs to further foster their success! And we continue to expand the types of CE we provide as well, including the ability for Canadian CFP certificants to earn CE credit from Kitces (effective immediately for 2025!), and we're aiming to offer CE for Accredited Investment Fiduciary (AIF) designees by the second half of the year!

We're also further expanding our more 'deep-dive' educational programs. In the second half of 2024, we launched two new 6-hour MasterClasses – one on Optimizing Roth Conversions, and the other on Optimizing Tax-Efficient Withdrawals From Retirement Portfolios – and in 2025, we'll be developing new MasterClasses on best practices in how to conduct a Discovery Meeting and a Plan Presentation Meeting with clients (launching in mid-year and Q4, respectively). We're also bringing back our popular IAR Ethics CE Day; save the date for Thursday, August 28th, to get all 6 hours of IAR Ethics CE (and cross-qualify the 6 hours for every other type of CE, too!) in one fell swoop, and registration is already open now! And based on your requests, in 2025, we'll be offering a second "CE Intensive" Day, sometime in Q3, to cover the other 6 hours of required IAR CE (on "Products & Practice") in a one-day virtual live event format (and again, cross-applying for other CE types as well). As always, though, we remain committed to providing IAR CE (and all our other types of CE!) for all of our Kitces article and webinar content as well; these CE Intensives are simply meant for those who would prefer to 'binge' the content all at once in single-day live experiences!

In the meantime, our own Team of Nerds continues to expand. We are currently hiring for a Research Associate to support the ongoing growth of our Advisor Productivity, Marketing, Technology, and Wellbeing studies (so please forward along to anyone you know who might be interested!). And we recently hired several new team members as well, including Managing Editor Shannen Patel (as former Managing Editor Sydney Squires transitions to become a Senior Financial Planning Nerd writer for Kitces) and Manager of People & Culture Dora Ogar!

If you're wondering how you can get more involved with the Kitces team, you can also sign up for our separate Career Opportunities mailing list (via our Career Opportunities page) to be notified when new positions open up! And for those who don't want to join the team full-time but would simply like to 'Nerd Out' with us for a bit and share what they do or know with their fellow advicers, remember to check out our "How To Contribute" page to see how you can engage with the Kitces platform as a guest writer, presenter, or podcast guest!

And all of this remains focused on advancing our core mission – to "Make Financial Advicers Better, And More Successful" – through our four strategic pillars of supporting 'Nnovation of AdviorTech tools, delivering insightful Education, conducting original advicer Research, and facilitating the Development of financial advicer skills across the spectrum of experience and firm sizes (and yes… our organizational strategy does spell N-E-R-D☺). We look forward to continuing the journey with you in 2025 and beyond!

Weekend Reading For Financial Planners (January 11–12)

January 10, 2025 02:00 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" - this week's edition kicks off with the news that the "Social Security Fairness Act" was signed into law this week, eliminating the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) provisions, which previously reduced the Social Security benefits of individuals who worked in both "covered" (jobs for which they paid into the Social Security system) and "non-covered" (those in which they didn't, typically public service jobs that come with their own pensions) positions during the course of their career (in the case of WEP) or the spousal or survivor benefits received by individuals who worked in "non-covered" jobs (in the case of GPO). Notably, the new law could affect a range of advisory firm clients, with those who were subject to WEP/GPO and currently receive Social Security standing to see a bump in their benefits while individuals subject GPO who didn't file for Social Security spousal benefits (because they would have been eliminated by GPO reductions) could find that they are now eligible to receive benefits (but will need to apply for them!).

Also in industry news this week:

A survey indicates that nearly 71% of new financial advisors drop out in the first 5 years, with firms offering better training and mentorship opportunities (as well as entry-level positions that don't come with business development targets) seeing higher employee retention rates
How broker-dealer self-regulatory organization FINRA could face a range of political and judicial challenges to its authority in the coming years

From there, we have several articles on investment planning:

How advisors can address client concerns that elevated stock valuations might portend a near-term market decline
While clients with an allocation to international stocks might be frustrated with their underperformance compared to the U.S. market in recent years, historical data suggest that geographic diversification could have benefits in the longer term
A historical study indicates that periods of high market concentration (such as today) tend to be associated with bull markets and aren't predictive of the timing of future bear markets

We also have a number of articles on advisor value:

Five ways financial planners can exceed client expectations in 2025, from educating themselves on technical topics of value to their ideal target client to increasing the number of touchpoints they have with clients (without necessarily taking up significantly more of the advisor's time)
How human advisors can differentiate themselves from financial advice provided from generative artificial intelligence tools, which are expected to become increasingly popular in the next few years
How advisors can use feedback surveys to determine what their clients value the most from their relationship and adjust their service model to provide even greater value

We wrap up with three final articles, all about credit card rewards:

How advisors can help clients determine the best credit card rewards approach for their unique situation, potentially enabling them to earn thousands of dollars worth of benefits and perks over the course of the year
While collecting (and using) credit card rewards points can be a lucrative proposition, it can be worth weighing the benefits against the time and potential financial costs of doing so
How taking a strategic approach can unlock the greatest value from accumulated credit card rewards, airline miles, and hotel points

Enjoy the 'light' reading!

Kitces & Carl Ep 155: How Do You Know You Are Adding Value Versus Just Trying To Justify Your Fees?

January 9, 2025 07:03 am 0 Comments CATEGORY: Kitces & Carl Podcast

Kitces & Carl Ep How Do You Know When Are You Adding Value Versus Just Trying To Justify Your Fees

While financial advisors offer valuable services for their clients, it can sometimes be challenging to gauge how much clients actually value those services. On one hand, a client's willingness to pay an ongoing fee for financial advice suggests that they find the advisor's services worthwhile. On the other hand, the term "financial advice" often refers to much more than asset allocation and wealth management. Many firms also offer regular meetings, webinars, client portals, and other services to enhance the client experience. Yet, with so many services available, it isn't always clear which ones truly make a meaningful difference.

In the 155th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss how advisors can look beyond engagement metrics to understand which services have the greatest impact on their clients' experience.

Engagement metrics are often used to gauge how much value a client derives from their financial advisory firm's services. For many advisors, a shift in engagement – such as a long-term client requesting fewer meetings – can be a cause for concern, as it might raise red flags signaling disengagement or even a potential move to another advisory firm. However, changes in behavior like this don't always indicate a problem. For instance, the same client wanting to reduce their meeting frequency from three times a year to just once might reflect not a loss of interest, but instead increased peace of mind, trust in the advisor, or confidence that if anything urgent comes up, they will connect with each other anyway.

This principle extends across many aspects of a firm's value proposition, from client newsletters to account log-in frequency to other common metrics of interest. While offering valuable resources to clients can make a difference, providing too many options risks overwhelming the client. Rather than reinforce the advisor's value, excessive offerings might even be a turn-off for the client, detracting from their overall experience.

This tendency to 'over-service' often comes from good intentions of providing great service and justifying the fee for financial advice, and advisors may hesitate to scale back out of concern for removing something clients value (e.g., a monthly newsletter they enjoy reading even if they never reply). To better understand what truly resonates with clients, advisors may find it worthwhile simply to start by asking. For example, sending a client engagement survey or talking with clients can provide meaningful insights. Similarly, investigating offerings that clients don't engage with – such as document vaults that they rarely use – can reveal where advisors can focus less effort, giving them more time to focus on what really does make a difference.

Ultimately, the key point is that traditional engagement metrics may fall short in capturing the true value clients place on financial advisory services. And, in a world where clients are increasingly busy and advisors face competing demands, the real opportunity lies in figuring out what truly matters to clients. By identifying the services that create the most meaningful connections and deliver the greatest impact, advisors can allocate their time and energy where it matters most – deepening trust, enhancing the client experience, and strengthening long-term relationships!

#FASuccess Ep 419: Attracting Clients Who Want To Align Their Investments With Their Values With A Sustainable Investing Approach, With Peter Krull

January 7, 2025 07:02 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome everyone! Welcome to the 419th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Peter Krull. Pete is the Director of Sustainable Investing of Earth Equity Advisors, an RIA based in Asheville, North Carolina, that oversees approximately $200 million in assets under management for 250 client households.

What's unique about Pete, though, is how he has grown his firm by exploring with clients how they can align their portfolios with their own personal values, effectively allowing their investments to become an expression of the types of businesses they want their capital to support… while still ensuring their overall portfolio is still well-diversified, tracks to broad market indices, and is prudently allocated to sound businesses.

In this episode, we talk in-depth about how Pete frames the differences between socially responsible investing (which is focused on excluding certain industries or companies from portfolios), ESG investing (which measures the risk to companies from environmental, social, and governance factors), and Pete's sustainable investing approach (which he views as a more bottom-up process designed to identify the sectors and companies that will be successful in the economy of the future), how Pete uses everything from industry newsfeeds to quantitative data to identify a broad universe of potential companies to invest in, and Pete's process for then narrowing down the pool of potential investment targets (which includes the use of fundamental quantitative metrics of company health, ESG evaluations from third-party analytics platforms, and Wall Street analyst ratings).

We also talk about why Pete views his investing style as a core holding in client portfolios (rather than a thematic addition) in part because he still seeks to at least roughly track the sector composition of broader market indices with investments that meet his sustainability criteria, why Pete uses a combination of individual stocks, ETFs, and mutual funds in client portfolios to maximize the universe of potential available investments (instead of using direct indexing, which he finds is too limiting when it's by definition constrained to only the companies available within the chosen index), and how Pete builds client portfolios with a combination of both equity and fixed income investments that meet his sustainability filters to ensure he can allocate with a stock/bond mix that meet clients' risk tolerance and desired portfolio characteristics.

And be certain to listen to the end, where Pete shares how his sustainable investing approach has been able to attract clients who want to feel like they are part of the solution in being able to direct their capital to support the companies building towards future they want to see, why Pete thinks that serving a well-defined niche has actually expanded his business opportunities because he doesn't face competition from other firms (that don't have his expertise) for the ideal clients he wants to serve, and why Pete decided to merge his firm into a larger one in order to create scale for his sustainable investment offerings and ultimately reach even more clients looking to align their investments with their values.

So, whether you're interested in learning about the differences between ESG, SRI, and sustainability investing, strategies for incorporating sustainable investing values when constructing client portfolios, or how specializing in a niche investment approach can be an effective way to attract new clients, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Peter Krull.