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News Roundup: Client profiling, breakaway satisfaction, and retirement savings regrets

Client Profile

Practice Management

If you want to truly understand your clients and help them attain their long-term goals, client profiling is key. Scott MacKillop, CEO of First Ascent Asset Management, shares some of the insights he learned from UC Berkeley economics professor Shachar Kariv, who has conducted research on the topic. Advisors must explore and understand the three dimensions common to every client: their goals, constraints and preferences, MacKillop notes in a column in Financial Advisor magazine. Advisors must also understand the various aspects of a client’s risk persona. See the link to his column below. Also, “Advisory firms should be thinking about how to provide challenging work and a career path for employees rather than relying on compensation as their only tool,” writes Pershing’s Mark Tibergien in a column at Investment Advisor magazine. To that end, he recommends that firms put in place a five-step career pyramid. See the full story below.

Creating The Right Client Profile

By Scott Mackillop

Source: Financial Advisor magazine

Do you want to differentiate your firm from the competition while adding value to your client relationships? Then you should focus attention on an area that is ignored by most advisors: client profiling. Few advisors think of this as an area where they might add value, but it presents them with a great opportunity to stand out in a way their clients will understand and appreciate.


Developing Talent

By Mark Tibergien

Source: Investment Advisor magazine

Many words have been written about the acute talent shortage in the financial-services industry for years. Yet, a 2016 study sponsored by BNY Mellon’s Pershing found that for the first time, the number of employee advisors exceeded the number of owners in RIA firms. Further, the universities that confer financial planning degrees are graduating and placing more students each year. What does this mean for your firm?



Breakaways/Aspiring Advisors

The results are, well, unanimous. A blind survey by Dynasty Financial Partners found that 100 percent of the breakaways it surveyed are happier for having made the move to the independent RIA channel, reports Financial Advisor IQ. The firm surveyed 450 financial advisors. FA-IQ reached out to some breakaways to get their views on the results and “all we got was confirmation,” according to the publication. See the details below. Also, Citigroup has confirmed that it is leaving the protocol for broker recruiting, InvestmentNews reports. “This decision allows us to continue to invest in our growing team of award-winning financial advisers,” a Citi spokesman wrote in an email to the publication. Citigroup has approximately 1,000 financial advisors. See the story below.

Breakaway Advisors Absolutely Love Their Independence

By Thomas Coyle

Source: Financial Advisor IQ

It’s almost comical. One hundred percent of former wirehouse or regional-brokerage advisors in the independent RIA channel are happier for having made the move. That’s according to a blind survey of 450 FAs by Dynasty Financial Partners — a sponsor that, as an infrastructure provider to breakaway RIAs, has to be pleased with the result.


Citigroup is latest big firm to dump broker protocol

By Bruce Kelly

Source: InvestmentNews

Another large brokerage has decided to exit the so-called protocol for broker recruiting, with Citigroup Global Markets confirming on Friday that it was leaving the agreement. “Similar to others in the industry, Citi has decided to exit the protocol,” wrote spokesman Drew Benson in an email. “This decision allows us to continue to invest in our growing team of award-winning financial advisers.”



Retirement Planning

Note to younger self: Save more for retirement. That’s one of the big takeaways from a recent American Century Investments plan participant study: About 90 percent of those surveyed said they regretted their retirement savings habits. However, 75% said their early-career self would be only “somewhat or very likely” to take that advice, reports ThinkAdvisor. Read the details below. Also, Natalie Choate, in a column at Morningstar, cautions IRA account holders to check for errors on two “tiny but powerful” tax forms, IRS Forms 1099-R and 5498. A mistake on either of these forms could cost clients money or a needless IRS audit, she writes. Advisors need to make sure their clients provide them with every copy of Form 5498 they ever receive in the mail. See a link to her column below.


Workers Regret Not Saving More for Retirement: Study

By Michael S. Fischer

Source: ThinkAdvisor

Some 90% of retirement plan participants in American Century Investments’ recently released fifth annual plan participant study expressed regret about their retirement savings habits. The number of pre-retirees in the 55-to-65 age group who reported having a great deal of regret rose by 5% in the past two years, the study found.


The One Form That IRA Holders Should Scrutinize

By Natalie Choate

Source: Morningstar

Every year, your IRA provider reports on your IRA to the IRS. Providers do this with two tiny but powerful tax forms, IRS Forms 1099-R and 5498. A mistake on one of these forms could cost you money or lead to a needless IRS audit. There are tens of millions of IRA accounts in the U.S., so there are going to be some reporting mistakes. Head off problems by eyeballing those forms carefully when you receive them, and if you find mistakes, getting them corrected. Moreover, know what every number and code on those forms means, so you can be sure your tax preparer correctly transfers the info onto your tax return.