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Advisors optimistic about post-fiscal cliff environment

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A majority of financial advisors believe that the post fiscal-cliff environment creates new opportunities for investment and tax planning, according to new research.

ByAllAccounts, Woburn, Mass., published this finding in a survey of more than 250 advisors, including broker-dealers, wirehouse reps, registered investment advisors and financial planners. ByAllAccounts conducted the online survey in conjunction with HWA International in February 2013.

Nearly 6 in 10 of the survey respondents say the post-fiscal cliff environment creates new opportunities for investment and tax planning. And almost 4 in 10 (38 percent) foresee post-cliff opportunities for advisors engaged in estate and trust planning.

This optimism is reflected partly in the survey respondents’ views of the American Taxpayer Relief Act of 2012, which made permanent provisions respecting, among other things, federal taxes on income, estates, dividends and capital gains. More than six in ten (62 percent) of advisors polled express satisfaction with the new law, though half of the respondents are only “somewhat satisfied.”

Similar majorities of advisors enjoyed increases in demand for trust services in 2012 (57 percent) and anticipate a zero to 20 percent increase in demand between in 2013 (46 percent).

The survey adds that irrevocable life insurance trusts (ILITs) are the most popular types of trust administered in-house by advisors. Half of the respondents do so.

The other top five trust vehicles managed in-house include:

revocable life insurance trusts (43 percent);

charitable remainder annuity trusts and charitable remainder unitrusts (31 percent);

Generation-skipping transfer trusts or dynasty trusts (27 percent); and

Education trusts (20 percent).

The survey adds that most respondents (54 percent) do not use in-house trust accounting software. Of the total, 30 percent are broker-dealers, 28 percent are registered investment advisors and 23 percent are financial planners.

Just 16 percent of those polled use trust accounting software and nearly a third don’t know.


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