Weekend Reading For Financial Planners (June 20–21)

Enjoy the current installment of “Weekend Reading For Financial Planners” – this week’s edition kicks off with the news that the SEC in recent examinations appears to be looking into RIAs’ use of held-away asset management technology that allows advisors to more efficiently and securely manage their clients’ 401(k) plan accounts by giving the advisor the ability to not just view and actually trade in the 401(k) account. Areas of concern for the regulator appear to include whether a firm is transparently disclosing fees (including whether fees charged by these platforms are covered by the firm or passed on to the client) and whether a firm is using third-party providers at all or is doing it themselves and then retaining client login credentials (which could create custody and data security concerns). Which highlights the importance for those who use held-away asset management technology to be able to explain to their regulator (whether at the Federal or at the state level) how it allows them to better holistically manage their clients’ assets without resorting to collecting client login credentials.

Also in industry news this week:

A survey of undergraduate students in financial planning programs finds that this group is largely focused on client service and growth opportunities (in addition to salary), suggesting that firms whose culture focuses on building long-term relationships with employees and clients alike could be more attractive to next-gen advisors
The quality of advice received and the quality of the relationship top the list of reasons clients leave their advisor, according to a recent survey, suggesting that advisors meeting with a ‘switcher’ might explore how their experience and communication practices might (or might not) be a fit for these prospective clients

From there, we have several articles on investment planning:

While a dividend-centric investment approach might come with tax inefficiencies (and potential concentration risk) compared to a ‘total return’ approach, it could still be attractive to certain retired clients who might be willing to spend more if they don’t need to tap into their principal
When it might (or might not) be prudent to reinvest dividends and how advisors can offer significant investment and tax planning value in this area
Why a focus on investing in dividend-paying stocks could leave investors with a tilt towards value stocks that they might not have expected

We also have a number of articles on practice management:

Three key questions advisory firms can ask candidates during an initial ‘phone screen’ to efficiently and effectively determine whether it’s worth investing more time evaluating a particular applicant
How financial planning job candidates can send more ‘positive’ signals during the interview process (and avoid ‘negative’ ones) while demonstrating both their technical and professional acumen
How financial advisory firms can demonstrate their culture during the hiring process to attract good-fit candidates who will be more likely to stick around for the long haul

We wrap up with three final articles, all about AI and the workplace:

A recent survey finds there appears to be a mismatch between the time workers say they save by using AI and how much additional productivity they achieve (which suggests that the task-switching and other costs of AI could reduce its potential time-saving benefits)
How firms can ensure jobs remain meaningful in a world of increasing automation and human-AI interaction
How the example of bank tellers (whose numbers actually grew after the introduction of the ATM, only to decline amidst the rise of smartphones and mobile banking) shows how technological innovations can have sometimes unpredictable effects on employment in specific fields

Enjoy the ‘light’ reading!