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Weekend Reading for Financial Planners (Apr 14-15)

Weekend Reading for Financial Planners (Apr 14-15)

Enjoy the current installment of “weekend reading for financial planners” – this week’s edition kicks off with the news that the SEC will be conducting an Open Meeting of all 5 commissioners next Wednesday, April 18th, specifically to discuss its widely anticipated proposals regarding new fiduciary requirements for brokers and investment advisers. Also in the news this week is a series of proposed “principles” that SIFMA is advocating the industry should adopt for best practices around account aggregation.

From there, we have several articles about how advisors charge for their services, including a new study from Cerulli Associates finding that the use of fixed financial planning fees is on the rise, the announcement that Fidelity is converting its entire financial advisory services to retail clients into a single unified (AUM) fee schedule, a survey from Pershing finding that leading advisory firms that focus on holistic planning are not feeling pressure to cut their fees (but are feeling pressure to offer new services to justify the fees they do charge), and a new Risk Alert from the SEC on RIAs that are failing to engage in proper billing practices with clients (usually not out of intended malfeasance, but simply lax processes and procedures for executing their billing in the first place).

We also have several tax-related articles, including suggestions on the key points to review on clients’ 2017 tax returns as tax filing season comes to a close, the rise of the DAPT (Domestic Asset Protection Trust) for both estate planning and asset protection benefits, and the challenges of tax reporting on Bitcoin and other cryptocurrency transactions (for which active cryptocurrency traders may have a very large volume of individual lot transactions, and the IRS is increasingly scrutinizing whether such investors are actually properly reporting their transactions and gains).

We wrap up with three interesting articles, all looking at the changing landscape of both industry standards and the organizations that serve advisors, including: a challenging article raising the question of whether the FPA is really fulfilling its vision to be a professional organization with local chapters, or is operating more like a trade organization that consolidates power to its national headquarters; a look at whether the CFP Board is doing enough to provide guidance to CFP certificants about how, exactly, they should be complying with the CFP Board’s new fiduciary standards to manage and mitigate conflicts of interest; and a look from Bob Veres at how it seems increasingly inevitable that the entire future of financial advice will be fiduciary… the only question is which regulator will make the rules to enforce it.

Enjoy the “light” reading!

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