Home > Aspiring RIAs > News roundup: Helping clients trim big holdings, dressing appropriately, and first-year retirement spending

News roundup: Helping clients trim big holdings, dressing appropriately, and first-year retirement spending

Practice Management

Pershing’s Mark Tibergien, in a column in Investment Advisor magazine, describes the differences between a “lifestyle practice” and an “enduring advisory firm,” and he outlines the conditions that advisors need to keep in mind when building an enduring firm, such as margin compression, brand confusion, and critical mass. See the full details below. Also, advisors know the dangers of holding a large position in one stock, but it’s not always easy to convince a client of the perils. An article at Financial Planning describes how advisors can broach the topic with clients and explains some of the tactics for moving that money — such as selling periodically or making charitable donations. See the link to the full story below.

From Style to Substance

By Mark Tibergien

Source: Investment Advisor magazine

Of all the trends that have influenced the financial advice business, perhaps the most profound is the evolution from lifestyle practices to more enduring business models. A “lifestyle practice” typically depends on one or two advisors. These advisors do not have a succession plan, human capital plan, definable strategy or means to measure success. They feel content with their existing client base and have no plans to grow. By contrast, an “enduring advisory firm” is structured to survive the founder.


Convincing clients to let go of huge holdings

By Donald Jay Korn

Source: Financial Planning

A time-honored idiom warns against putting all your eggs in one basket, and the reason is evident to every adviser: such a portfolio is vulnerable to being cracked or broken if a single stock slips. Even the heartbreaking stories of investors who lost most of their wealth after Enron and Lehman Brothers collapsed can’t convince some clients to sell.


Aspiring Advisors

For new advisors in particular, deciding how to dress when meeting with clients can be a perplexing. In a post at Nerd’s Eye View blog, Derek Tharp explains the terms “signaling” and “countersignaling” and the implications they can have on the decision to dress down (or up). “The caveat is that what works for a subset of experienced advisors doesn’t necessarily work for all advisors, and especially not for younger and inexperienced advisors,” he writes. See the full post below. Also, a recent survey of CFP professionals found that 91% of respondents are very satisfied with their career choice in financial planning, reports ThinkAdvisor. A majority of those surveyed (66%) reported that they feel becoming a CFP professional had a positive impact on their income. Read more survey details below.

How (New) Advisors Should Dress And The Dangers Of Countersignaling

By Derek Tharp

Source: Nerd’s Eye View blog

How we dress is an inherently personal topic. What we wear conveys messages about who we are, what we value, and who we hope to become. As a result, talking about dress and “appropriate” clothing can be a touchy subject. But it’s not a topic that financial advisors should shy away from, as our dress can have a real-world impact on our professional success.


CFPs Believe They Have a ‘Competitive Edge’: Survey

By Emily Zulz

Source: ThinkAdvisor

Certified financial planner professionals report very high satisfaction with their career choice and decision to obtain the CFP certification, according to a new survey by the Certified Financial Planner Board of Standards. As of May 31, there were 77,880 CFP professionals, an increase of more than 4,000 since 2015. The 2017 Survey of CFP Professionals was conducted via telephone conversations with 800 CFP professionals in late May and early June using a random sample.


Retirement Planning

Advisors need to work with clients to ensure that their first year of retirement spending doesn’t endanger their retirement portfolio for the next 30 or 40 years. A Financial Advisor article explores some of the ways to safeguard funds during that first year — particularly for clients who are apt to over-spend. One of the key decisions advisors can help clients make is how much “play money” to set aside for those first 12 months. Read the full story below. Also, a 65-year-old couple that retires this year can expect to pay 6% more on health care than in 2016, Fidelity Investments reports. The analysis estimated a couple would pay $275,000 for health care and medical expenses during retirement, according to ThinkAdvisor. Read the details below.

3 Key Decisions So Clients Don’t Wreck Retirement In Year 1

By Juliette Fairley

Source: Financial Advisor

Chances are, within the first 12 months that a client transitions from work to retirement, they will want to spend their savings on trying new things. Trouble is blowing too much money can result in missing out on stock market returns. “The decisions you make at this dicey and vital juncture, many of which are irrevocable, will profoundly affect your financial security and your lifestyle for the next 30 to 40 years,” said Ray LeVitre, advisor and author of  20 Retirement Decisions You Need to Make Right Now.


Retiring This Year? Here’s What You’ll Pay for Health Care

By Michael Fischer

Source: ThinkAdvisor

Fidelity Investments reported Thursday that a 65-year-old couple retiring this year can expect an estimated $275,000 in health care and medical expenses throughout retirement. Fidelity’s annual analysis of retirees’ health care costs represented a 6% increase over last year’s estimate but a whopping 70% increase since its initial retiree health care cost estimate in 2002.


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