Outside voices and views for advisers

Feb 8, 2016, 1:55 PM EST

How to attract, and keep, young high-net-worth clients

By James Williams

The high-net-worth market has grown significantly over the past six years, with nearly one million new high-net-worth individuals (HNWIs) added globally in 2014, according to the 2015 World Wealth Report.Every year there is a higher proportion of younger affluent investors who prefer to use mobile phones, smartwatches, tablets and other mobile devices for nearly all their information, transactions, and interactions. Like all wealth management clients, they expect strong portfolio performance and exceptional client service; they just want them to be digital and ubiquitous. In fact, 65% of all HNWIs expect to run most or all of their wealth relationships digitally within the next five years. Younger HNWIs want — and expect — a seamless experience across all devices and platforms. They don't think about which device or platform they are using for their transactions. They expect touch points across all channels to be aware of... Read full post

Feb 7, 2016, 8:32 AM EST

The return of volatility means the good, bad and ugly will be revealed

By Bob Rice

For several years of steadily rising prices across all asset categories, investing was like bowling with gutter guards: Everyone showed solid scores in every frame. Monotonous gains pushed measured volatility to historic lows. But volatility is surging again, mostly for reasons that will linger for years. Future investing score sheets are going to show who's actually good at this game. The primary change agent is the Federal Reserve, even if it just goes “one and done” with its tightening. Merely standing pat as the rest of the globe's central banks keep up their liquidity injections will set off currency fireworks and continuing market spasms.... Read full post

Feb 4, 2016, 3:40 PM EST

How brokers can navigate consolidation in the B-D industry

Financial advisers today face more uncertainty and potential headwinds than ever before — the Department of Labor's pending fiduciary ruling, rising technology and compliance costs, and increased regulatory scrutiny are just a few of the significant concerns. As a result of these and other issues, the broker-dealer industry is at a crossroads and is consolidating at an accelerated pace, unlike any period I have seen in my 30-plus years in the industry.No matter what stage of their career advisers are in — from just starting out to thinking about succession planning — now, more than ever, it is critical that they focus on how they can navigate to succeed in this new and consolidating landscape of broker-dealers. To understand how to navigate to what's next, advisers should first be aware of some of the factors driving all of this change. While it is true that the buying and selling of firms is not a new trend, it is... Read full post

Feb 4, 2016, 2:59 PM EST

The goal-setting process Warren Buffett uses to say 'no' and achieve more

By Brad Johnson

Top achievers' thought processes are often the same. I was recently reminded of this when a friend shared a story about how he's been able to achieve consistent double-digit growth every year for the last decade.It all began when I asked him, “What's your secret to your consistently amazing growth every year?”After all, he has generated annual revenue growth of 15% to 20% every single year, which is an incredible achievement.His answer surprised me. He said, “I've said no more than any other time in my career.”At first, I didn't quite understand what he was saying, so he continued. “In the past, I was the guy chasing shiny objects, so I'd be the guinea pig and test a handful of them each year in my practice. I would try three, four, five or more new ideas every year. Maybe one of them would pan out and lead to modest results, but the others were usually flops.”“But now it's totally different.... Read full post

Jan 28, 2016, 6:45 AM EST

Legacy planning is not just for the rich and famous

By James T. (Jim) Swink

Many of us will remember the Barbra Streisand song “The Way We Were” and the verse “Memories light the corners of my mind.” When we think of family and the next generation, we want those memories to be positive and not locked away in the corner. That is why if we want to leave a meaningful legacy, we must have a plan.When we hear the word legacy, many of us think that it only applies to the rich and famous. It is important to remember that a legacy is the transfer of family goals, dreams, history and, yes, financial assets. Many families have history that should be shared with future generations. They have goals, dreams and aspirations for future generations. This is where the “family love letter” has a role. The family patriarch and matriarch may write an informal family history that sets the tone for the dreams for future generations. In my family, my father wrote a six-page letter to my son on my... Read full post

Jan 21, 2016, 2:46 PM EST

Recent class-action surge ups the ante for 401(k) advice

By Blaine F. Aikin

All eyes may be on the Labor Department's fiduciary rule, but don't forget the courts.Eleven major class-action lawsuits were filed in federal courts around the country against 401(k) sponsors or providers of retirement products in the fourth quarter of 2015. All involve alleged fiduciary breach claims of, among other things, excessive fees benefiting service providers in violation of the Employee Retirement Income and Security Act of 1974 (ERISA).Most of the defendants are industry brand names, including Allianz, BB&T, Deutsche Bank, Fidelity, Insperity, New York Life, Prudential, Putnam and TIAA-CREF. All of the suits seek class-action status and millions of dollars in damages. While Congress, the DOL and the Securities and Exchange Commission define the boundaries for fiduciary advice and shape its contours, it's the court system where the rubber meets the road and factual issues are sorted out. The courts play a critical role in... Read full post

Jan 20, 2016, 5:55 PM EST

The rise of Trump, and what it means for markets and advisers

By Chad Carlson

It's hard to believe, but 2016 is upon us and Donald Trump is still in the limelight of the Republican presidential race. A year ago, many predicted Mr. Trump would put his foot too far into his mouth at some point and fall out of the race with a bang. That foot has been inserted plenty of times, often intentionally, but not to his demise. In fact, his mistakes have sometimes contributed to his rise.Love him or hate him, now that we have come this far, we have to give serious thought to the 'what if' scenario — What if Mr. Trump becomes the Republican nominee?And further still, what if his 'say anything, political outsider persona' kept on working and the country embraced him as our next president? What could this mean for the markets? For advisers?SHOOTING FROM HIP On the good side, Mr. Trump wants to address many of the issues our country is having by the simple method of fixing our economy. How? By growing it faster than... Read full post

Jan 6, 2016, 5:49 PM EST

Commonly overlooked nuances of forgivable notes

By Jodie Papike

While consulting with advisers in transition, I frequently talk with those who need transition money in order to make a broker-dealer change. While capital is appealing, it typically comes tied to details that can dramatically affect the attractiveness of the deal, as was the case for an adviser I recently spoke to.Jon was fed up with the empty promises made by his broker-dealer. He was tired of the firm's not following through on things agreed to during the recruiting process. Jon had decided he was done, and there was nothing left to do but find a new broker-dealer. His story was nothing I haven't heard before. But picking up and moving to a new broker-dealer is sometimes easier said than done.When Jon moved to his current broker-dealer, he got transition money in the form of a seven-year forgivable note that had production hurdles tied to each year's forgiveness. Jon thought the note wasn't going to be much of a hindrance, as he has ... Read full post

Jan 6, 2016, 2:41 PM EST

Making sense of China's huge stock market selloff

By Chen Zhao

Chinese investors have been agitated by domestic authorities' proposal to implement the so-called “circuit breaker,” a mechanism designed to halt trading if stock prices gyrate too wildly in both directions. Investors collectively responded to the proposal by selling down the stock market by 7% on the first trading day of 2016. It is not immediately clear why a mechanism that presumably protects investors would cause a rout in the marketplace. Some say it was the disappointing manufacturing data that triggered the selloff, while others speculate the panic was brought about by the expected end of a selling ban on large Chinese institutional investors. Whatever the reason, the panic selloff seems to be irrational. There is no question that the Chinese economy is soft. Nevertheless, this is no longer news for financial markets where stock prices already have discounted the soggy economic picture. Indeed, last month's... Read full post

Jan 4, 2016, 6:00 PM EST

4 adviser takeaways from 'The Big Short'

By Grant Webster

Most advisers have undoubtedly read — or at least know the basic premise behind — Michael Lewis's “The Big Short.” The recently released movie version of the book follows several teams of Wall Street traders and hedge fund managers throughout the early stages of the 2008-2009 financial crisis, as they attempt to profit from and reveal a meltdown in the U.S. housing market. The movie does a remarkable (and somewhat comedic) job of explaining complex financial concepts to the audience — while maintaining a dramatic and almost sobering tone. Big name stars like Steve Carrell, Brad Pitt, Ryan Gosling and Christian Bale play underdog characters who are determined to win a bet against the U.S. housing market and the big Wall Street bankers — while putting all their chips on the table in the process. The big losers, unfortunately, were the millions of people who lost their jobs, homes and livelihoods when... Read full post

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