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News Roundup: Robo-advisor returns vary widely, UBS leaves broker protocol, and Roth celebrates 20th birthday


Practice Management

A recent study on the performance of 20 direct-to-investor robo-advisors finds a wide variation in returns, noting a 281-basis-point difference between the top and bottom performers, reports Financial Advisor. TD Ameritrade had the best-performing robo-advisor year-to-date, according to the report by BackEnd Benchmarking. However, “for most of our research we’re only looking at a little more than a year’s worth of results,” said a research analyst at the firm. Read the details below. Also, in an interview with ThinkAdvisor, Rick Kahler, a founding board member of the Financial Therapy Association, talks about the value of incorporating financial therapy into an advisory practice. “Ninety percent of money decisions are made emotionally,” he tells the publication. “Most people have a huge underbelly of emotions and beliefs” that planners need to acknowledge. He also discusses how he counseled Wynonna Judd when she was on the brink of bankruptcy. See a link to the Q&A below.

Robo-Advisor Returns For Clients Vary Greatly, New Report Finds

By Christopher Robbins

Source: Financial Advisor

As robo-advisors proliferated, there was little for investors and advisors to use to differentiate one from the other, aside from the promises of product providers and slick advertisements. Now, as robo-advisors swell towards an anticipated $166 billion AUM, comparative research from Martinsville, N.J.-based BackEnd Benchmarking finds huge disparities in robo-advisor returns.


Your Clients Don’t Just Need Advice, They Need Financial Therapy

By Jane Wollman Rusoff

Source: ThinkAdvisor

Sex and money are, ironically, what both men and women psychologically struggle with most, research says. Can financial advisors help clients overcome money issues that impede their investing? Yes, by offering financial therapy to help turn destructive behaviors into logical investment decisions. Indeed, FAs’ failure to address the reality that clients base 90% of financial decisions on their emotions will “probably be their undoing professionally.” So says wealth advisor Rick Kahler, a founding board member and past president of the Financial Therapy Association, in an interview with ThinkAdvisor.




UBS is leaving the Protocol for Broker Recruiting, following in the steps of Morgan Stanley, which said last month it was leaving the Protocol, according to ThinkAdvisor. Consultant Danny Sarch said the move could lead to a wave of departures at UBS and could hurt clients. Read the full story below. Also, Caleb Brown of New Planner Recruiting writes about three success stories in which younger generation advisors became owners in their respective firms and lists some of the important takeaways. He also provides a list of qualities that these planners exhibited during their rise to successor status, including eagerly taking on additional tasks whenever needed and being quick learners. See a link to the full post below.

UBS Exits Protocol, Creating ‘New World’ for Advisors, Clients

By Janet Levaux

Source: ThinkAdvisor

One month after Morgan Stanley said it was leaving the Protocol for Broker Recruiting, UBS says it will too. “As our operating model is more focused on retaining our existing advisors than recruiting to grow our business, UBS will no longer be subject to the Protocol effective Friday, Dec. 1, 2017,” said Tom Naratil, head of the firm’s Wealth Management Americas unit, in a memo obtained by ThinkAdvisor.


Successful Successions

By Caleb Brown

Source: New Planner Recruiting

This month, we will share the specifics from three, of many, succession success stories we have observed working with financial planning firms on hiring and integrating new talent. Below we lay out the details of how several candidates from various backgrounds and possessing a variety of skill sets were able to become owners in their respective firms.



Retirement Planning

It’s the 20th birthday of the Roth IRA, but IRA distribution expert Ed Slott notes that they are “still greatly underused.” In his column, he describes the many benefits of a Roth and explains how advisors can overcome client resistant and provide value by suggesting Roths or Roth conversions. See the link below. Also, many retirees say they’d like to consolidate their accounts, but few have done so, according to Cerulli research. For example, 46% of those retired for one to five years say they’d like to consolidate their assets, but only 11 percent have done so. Cerulli suggests an answer might be to create a new position called “consolidation concierge.” See the story below.


It’s Roth’s 20th birthday party. Where is everyone?

By Ed Slott

Source: Financial Planning

As the ball drops this New Year’s Eve, don’t forget to raise a glass to the Roth IRA. January 1 marks the 20th birthday of this key retirement account. In the past two decades, Roths have grown to hold more than $660 billion in assets, according to the Investment Company Institute. But as popular as they have become, they are still greatly underused.


Consolidation Concierges: A New Advisory Position?

By Lee Barney

Source: planadviser.com

Upon approaching retirement, the average investor has 3.6 financial provider relationships, Cerulli research shows. While 46% of those who have been retired between one and five years, only 11% have actually consolidated their assets. The desire to consolidate assets declines slightly over time for retirees, with 45% of those retired between six and 10 years wanting to bundle their assets with one provider, but only 14% having done so.