There's a "different mindset" that advisors need to have when focusing on the distribution phase of a client's life, says Scott Slater, and the firms that do focus on retirement are getting better educated when it comes to figuring out "which pools of money should be drawn from first," always considering the tax effects. Slater, managing director of business consulting for Schwab's Advisor Services RIA unit, says the best firms still begin with assessing client needs, but must ask themselves two fundamental questions: how well have they identified who they're serving, and what is their value proposition? Only then can they build their firms, and structure their compensation, to match the clients they're serving. If part of your value proposition, he says, is to be your client's primary advisors, then there are specific services you will need to offer. "If you care deeply about your clients," Slater says, you may get involved in helping pick nursing homes for clients or their parents. Warning against this kind of "scope creep," as he calls it, Slater also says "advisors shouldn't be afraid of charging for a service if they're adding value." Advisors have to be more "creative" when it comes to compensation, since charging an AUM fee on a declining asset base is not a great idea. As for the future, Slater suggests that trust services will become increasingly important to clients and thus to advisors, "not just to keep the assets, but for tax reasons" as well.
Access complimentary resources from Cambridge Investments to help navigate the fiduciary rule changes.
If you’re thinking of changing broker-dealers, you owe it to yourself to read this article that covers all major aspects of the transition process.
This White Paper outlines the immediate actions firms can take to correct outdated and costly supervision procedures.
Sep 27, 2016
Some broker-dealers have already decided to exit certain lines of business and are sizing up how the rule will impact their IT and compliance budgets....
Sep 20, 2016
This webcast will review the key aspects of the amendments and the steps that funds and intermediaries can take in order to comply with the...
Sep 13, 2016
Nationwide is providing a deeper look into the rule’s implications and a discussion of decisions firms will need to make in order to comply.