David Tittsworth’s voice will be missed by all who believe in the fiduciary standard in the financial services world, and there may be celebrations going on at brokerage firm headquarters to mark his retirement. Meanwhile, in this issue of Financial Advisor, we get a peek at new tech initiatives at the larger custodial firms, and two columns that relate to selling your practice: an interview with David Grau, who says that most advisors should look at internal succession rather than an outright sale to an unrelated party, and Mark Hurley, who says beware of anyone offering stock in exchange for all or part of your firm.
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Nobody remembers that I (Bob Veres) created the very first advisor software survey, because I kept a spreadsheet of all the software options that I would send to advisors when they would ask me a software-related question. Today, the Financial Planning software survey, created by Joel Bruckenstein, is a huge resource for the profession, a barometer of where we are and where we’re going. That said, I miss the comprehensive listing of all the programs out there, price, contact information and feature set.
Beyond that, I’m pretty sure I have never given out this many “high” relevance ratings in a single issue of any magazine before. Kelli Cruz offers great advice on how to make performance reviews productive and less painful. Kimberly Foss helps advisors recognize and manage their own stress levels during a market downturn (how soon will we need this advice?) and Ann Marsh has managed to compile 17 different tips on planned giving for clients. The profile of Mike Walther, who has been profiled in Inside Information, identifies a potentially huge resource for advisory firms, Ed Slott gives guidance on how to roll corporate plan assets into traditional and Roth IRAs based on a new revenue ruling, Don Korn offers a pretty good summary of ways that you can lower taxes by spreading out your tax base among family members, and I really liked Alan Roth’s advice about listening to soothsayers who masquerade as economists. The parting thoughts offered good advice on a thorny topic (dementia) and even the Veres column made peculiar sense this month.
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How often do you hear founding advisors lament how they can find everything in a successor except the rainmaking capability? Angie Herbers, in the cover article of the November issue of Investment Advisor, says the problem can be solved if you give up on the rainmaking model altogether. Replace it with a firmware process that may involve three client meetings, that everyone is trained to run. The close rate goes up, and everybody knows how to go through the process that leads to a mutual commitment. The alternative is to hire a 20-something person and ask that person to become a rainmaker, which isn’t likely to happen overnight…
Mark Tibergien makes an interesting distinction between missionary and mercenary cultures at advisory firms, and you probably understand the difference immediately when you see the terms. The question is: are you, without intending to, communicating a mercenary culture by your decisions and your focus on revenues and short-term profits?
Finally, take a look at the Bob Clark article, and go back to the terms and conditions that you clicked when you renewed your CFP license. You might be surprised at what you find.
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This issue of Financial Planning gives you a brief scouting report on the various colleges offering a financial planning degree or training students to take the CFP exam. As usual, you will be surprised at how small the programs at the major universities are in terms of students, and how much larger are the institutions like the College for Financial Planning and the American College.
The other strong articles: Glenn Kaputt talks about how he trains new advisors, and Christine Gaze—who is somebody you should start knowing about in the practice management consulting space—happens to recommend that you pay more attention to your internal training processes. Meanwhile, Veres suggests that you might be able to address almost any future uncertainty with a few basic adjustments to your practice. Better start now; in a future column, he’s going to predict some very specific disaster scenarios that are coming down the pike…
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