RIA Central Digests for 10/23/2014

Regulatory/Compliance

 

Assistant Labor Secretary Phyllis Borzi, who has been championing an expanded definition of “fiduciary” in the retirement plan area, is reportedly waiting in the wings while Labor Secretary Thomas Perez hears from opponents of the plan. InvestmentNews has the story. Also, financial planning for same-sex couples still involves a lot of uncertainty post-DOMA. David Gordon, a former attorney who is now executive director of The Gordon Financial Group, talked with ThinkAdvisor about some of the biggest changes since the ruling and some of the challenges that still exist, such as health care coverage and Medicaid. One of his tips for advisors: Connect with experts in the field. A link to the story follows.

 

Borzi Taking A Back Seat On Fiduciary
By Mark Schoeff Jr.
Source:InvestmentNews

 

The leading player in the Department of Labor’s effort to raise investment advice standards for retirement plans is patiently waiting on the sidelines while her boss talks to opponents of the measure. Labor Secretary Thomas Perez has been meeting with industry representatives to hear their qualms about the measure, which would expand the definition of “fiduciary” under federal retirement law to include more advisers, such as brokers who sell individual retirement accounts.

 

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After DOMA, Financial Planning Still A Challenge For Same-Sex Couples
By Danielle Andrus
Source: ThinkAdvisor

 

When Section 3 of the Defense of Marriage Act was ruled unconstitutional last year, gay and lesbian couples gained access to some federal benefits afforded married couples, but the ruling didn’t require states to recognize their unions. Now, state bans on same-sex marriage are dropping like flies, but the legal landscape for same-sex couples is still in flux. It can be especially challenging for married couples who move to a state that doesn’t recognize their union.

 

Read the rest of the story…

 

 

RIA Central Digests for 10/22/2014

Practice Management

 

Michael Kitces digs into a recent study on advisory firm acquisitions from Aite Group and NFP Advisor Services and presents some of the intriguing highlights, including the finding that those who acquire practices “on the cheap” generally experience the lowest satisfaction levels after the fact. His post is at Nerd’s Eye View. Also, more firms seems to be experimenting with a varied compensation model that might include AUM fees for some, retainers for another, or a combination of both as they deal with a financially diverse clientele. An article at Research Magazine describes some of the approaches advisors are taking, particularly with younger investors, as well as how advisors tackle “the talk” with clients about changes in fee structures. A link to the story follows.

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Building a Planned Giving Niche

Charitable givingA few years back, I spoke to an advisor in Dallas, Texas who had earned the Chartered Advisor in Philanthropy (CAP) designation from the American College. He planned to use this designation well into his own retirement as he reached out into his community and aided charitable institutions.

 

Becoming an expert in planned giving has several advantages for your practice:

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RIA Central Digests for 10/21/2014

Sales & Marketing

 

It doesn’t take long for a prospect to form an opinion of you: Five seconds or less. That’s why it’s important to make that first impression count — even before the client walks in the door. In a column at Advisor Perspectives, Dan Richards goes over some of the “little things” you can do before and during a prospect meeting to create a positive image. A link to the story follows. Also, why not borrow a page from schools around the country and host a “back-to-school” night for clients? John Anderson of SEI Advisor Network suggests that it’s a good way to remind clients “of who you are, what you do and what they can expect in their relationship with you.” Read his tips in a blog post at byallaccounts.com, below.

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RIA Central Digests for 10/16/2014

Regulatory/Compliance

 

The SEC had a “banner” year for enforcement actions in fiscal 2014, according to the agency’s enforcement chief, and there won’t be any easing up in the coming year. Andrew Ceresney, SEC director of enforcement, said insider trading will continue to be a “major focus” for the agency, as will private equity fees, microcap fraud, and pyramid schemes, according to a story at ThinkAdvisor. A link to the story follows. Also, the SEC Investor Advisory Committee has recommended that the SEC consider changes to the definition of accredited investor, a move that could impact which Americans can invest in nonpublic offerings. Currently private placement purchases are limited to individuals who earn at least $200,000 a year or have a net worth of $1 million (excluding primary residence). A story at InvestmentNews has the details on how that definition could change.

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RIA Central Digests for 10/15/2014

Practice Management

 

As it turns out, most of the “unique” value propositions that advisors offer to clients aren’t really that unique. In reviewing a recent study by Pershing Advisor Solutions, Michael Kitces notes that findings show advisors offer little more than “table stakes” when describing their propositions. For an advisor to differentiate him/herself today “requires a deeper, more specialized focus,” he writes. Read more in his post at Nerd’s Eye View. Also, RIABiz provides a recent webinar transcript that covers such industry topics as robo-RIAs, technology, and “the staying power” of independent advisors. Participants included an RIA owner, an RIA attorney, and a reporter from RIABiz. A link to the story follows.

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RIA Central Digests for 10/14/2014

Sales & Marketing

 

Instead of asking clients what you can offer to them to increase engagement, it’s time to ask what you can create with them. Julie Littlechild refers to this as “co-creation” of value and provides ways that you can use this process in your practice. For example, you can co-create a meeting agenda that ensures your client is actively involved in shaping the conversation during the meeting. A link to her post follows. Also, authoring your own book can be an enduring marketing tool that helps build your reputation with clients and prospects. If you have an idea for a book, but need help bringing it to fruition, there are several coaching and publishing firms that can help. A story at Financial Planning offers more details.

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Use the Ebola Threat to Review Your Emergency Procedures

EbolaThe chances of an Ebola epidemic are extremely low, but with so much in the news about Ebola these days, it’s a good time to review your practice’s emergency procedures. Conduct a risk analysis of your business. Educate your team and your clients about your preparation for any kind of disaster, natural or otherwise, and take the following precautions:

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RIA Central Digests for 10/09/2014

Regulatory/Compliance

 

Too old and too male is how the Public Investors Arbitration Bar Association (Piaba) described Finra arbitrators in a recent study. The association also chastised Finra for failing to do a study on the diversity of its arbitrators, according to a story at Financial Advisor. Finra disputes Piaba’s claims, however. Read more in the story that follows. Also, assessing the costs for the second phase of a proposed Comprehensive Automated Risk Data System (CARDS) has put Finra chief economist Jonathan Sokobin in the spotlight. InvestmentNews talked with Sokobin about the process of compiling cost-benefit information on the plan. See the story below.

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RIA Central Digests for 10/08/2014

Practice Management

 

It’s true that the advisory profession is going through “a very complicated multifaceted transition phase,” says Bob Veres. But don’t try to tackle a “to do” list of changes for your practice all at one time. Veres helps by listing recommended changes to be made and rating them according to priority, from “urgent” to “not necessarily any time soon.” For example, “Creating a more interactive planning experience” is tagged as urgent. His column is at Advisor Perspectives. Also, the volume of M&A deal activity in the RIA space has been “wrongly documented,” according to information presented at the recent ECHELON Deals and Dealmaker Summit. Instead of the reported average of 47 deals annually in the industry, the estimate reported at the conference was that 1,009 advisors were involved in deals in 2013. See the story below from RIABiz for details.

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