Weekend Reading For Financial Planners (August 9–10)

Enjoy the current installment of “Weekend Reading For Financial Planners” – this week’s edition kicks off with the news that a recent report from The Ensemble Practice finds that advisory firms are in a period of “prosperous stagnation” with strong profitability (with the firms surveyed showing a record average operating profit margin of 39.2% in 2024) but organic growth falling short of targets (an average of 3.1% below the average firm growth goal of 10.0%). The report suggests that while many firms have streamlined operations and experienced tailwinds from strong equity markets the past couple years, bringing on new clients has been a challenge for some (highlighting that fast-growing firms tend to allocate larger shares of their budgets to marketing, expenditures which could crimp profitability in the short run but lead to greater opportunities in the long run).

Also in industry news this week:

Artificial Intelligence (AI), anti-money laundering, and cybersecurity top the list of concerns amongst RIA compliance officers, according to a recent survey, as firms adjust to a rapidly evolving technological and regulatory environment
An Executive Order signed this week intends to clear the way for 401(k)s to be able to offer private equity, cryptocurrencies, and other alternative assets in their investment lineups

From there, we have several articles on retirement planning:

The potential value of incorporating “income risk” (which can be a particular concern for clients nearing retirement, as well as those just staring out) when considering client portfolio allocations
Four ways to beat “sequence of return risk”, including incorporating flexible spending rules, holding “buffer” assets, and more
Why a “rising equity glidepath” in retirement can improve client outcomes and how advisors can effectively communicate this (perhaps counterintuitive) strategy to clients

We also have a number of articles on practice management:

Why establishing a strong firm culture is not just a matter of having an established mission and values, but is also a matter of understanding the employee experience and getting buy-in from all team members
How an effective firm-wide retreat can both bring the team closer together and give the business a clearer sense of direction for the coming months
How establishing a “Culture Committee” helped one firm improve employee morale and retention after a particularly stressful period

We wrap up with three final articles, all about college planning:

Eight to-dos for clients and their children heading to college this fall, from ensuring proper insurance coverage to getting key legal documents in place
How the Common Data Set document can help families find colleges where their student might receive a generous merit aid award
How a student’s post-college success is determined by factors that go well beyond the prestige of the school they attend

Enjoy the ‘light’ reading!