| A weekly digest of news and industry updates for the financial planning community |  |
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- Groups prepare for hearing on SRO bill this week
Trade groups that oppose a bill by House Financial Services Chairman Spencer Bachus, R-Ala., that would shift oversight of investment advisers to a self-regulatory organization will argue in a hearing this week that the move would hurt small firms. Officials from the Financial Industry Regulatory Authority also will testify, making the case that they are best able to regulate advisers. An ongoing dispute over the cost of oversight is likely to be part of the testimony. InvestmentNews/Washington INsider blog (free registration)
(6/1), AdvisorOne
(6/1)     
| Policy Watch | | |
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- GAO report faults SEC on oversight of FINRA
A Government Accountability Office report raises concerns about the Securities and Exchange Commission's oversight of the Financial Industry Regulatory Authority's rules and reviews. The findings come as a House panel is considering a bill that could make FINRA a self-regulatory organization for investment advisers. SEC officials said they have focused their limited resources on FINRA departments that have the greatest impact on investors. InvestmentNews (free registration)
(5/31), Financial-Planning.com
(6/1)
- SEC signs off on new rules to avoid future flash crashes
The Securities and Exchange Commission approved a proposal for rules aimed at preventing another flash crash like the one that occurred in May 2010. A new "limit up-limit down" mechanism will stop trades in individual securities that fall outside of a specified range. The second rule will refine the standards for when trading in all U.S. equity markets can be halted. AdvisorOne
(6/1)
| Practice Management | | |
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- Web services put planners under the microscope
Online services such as BrightScope and Paladin Registry give clients a host of ways to uncover information about financial advisers. The sites typically are easier to search than existing regulatory databases are, and they include details such as professional histories and details on how advisers are paid. While advisers may face increased scrutiny online, the sites also provide a way for professionals to establish their credentials. WealthManagement.com (U.S.)
(6/4)
- Build your practice by learning to sell your services
Selling yourself as a planner is critical if you want to find and keep clients, writes Vern Hayden, president of Hayden Financial Group. That includes learning to understand the dynamics of the client-planner relationship and helping clients expand their comfort zones. Four key steps are educating, participating, visioning and building trust, Hayden writes. Journal of Financial Planning
(6/2012)
- Survey: Risk management and compliance take center stage
Financial advisers are spending significantly more time dealing with risk management and regulatory compliance, according to a survey of investment-advisory and broker-dealer executives by Fidelity Investments. The shift has forced advisers to cut back on the time they spend on client service, business development and marketing, the survey found. Financial Advisor online
(5/31)
- How policy statements can keep investments on track
Investors and advisers each benefit when they create written investment-policy statements, experts say. These statements outline an investment philosophy, and they help investors stay the course during volatile times, regardless of whether they are directing their own investments or working with an adviser. The Wall Street Journal
(5/30)
| Industry Report | | |
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- PIMCO's Gross warns investors to avoid Europe
Investors should avoid investing in the eurozone until private entities are confident enough to extend credit to the region, Pacific Investment Management fund manager Bill Gross said. Gross said European leaders will be unable to solve the current crisis without funds from outside the continent. "We would suggest ... avoiding the entire eurozone until they can come up with some type of solution which involves the private sector," Gross said. Financial Advisor online/Bloomberg
(6/1)
- Report: 401(k) fees can drain retirement savings
The average American couple could lose more than 30% of their 401(k) savings to fees, according to a report by the research organization Demos. A couple that saves $510,000 for their 401(k) account could be left with $355,000 after fees, the report found. Some experts disputed the findings. Los Angeles Times (tiered subscription model)
(5/29)
- Planners debate the importance of diversification
The market crisis in 2008 caused many planners to rethink their assumptions about asset correlation and modern portfolio theory. However, many still argue that diversifying portfolios is an important part of a long-term planning strategy. While correlation has increased, clients should continue to have exposure to a mix of domestic and foreign stocks, real estate and commodities, one planner says. Journal of Financial Planning
(6/2012)
- Should retirement planning consider discretionary spending?
Dividing expenses into essential and discretionary categories may not always be helpful for retirement planning, Michael Kitces writes. Not having enough money for "wants" would be a huge failure for many retirees. That's why some clients are willing to work longer and save more so they'll have enough money to afford the lifestyle they want during retirement. Nerd's Eye View blog
(5/30)
- What divorcing couples should know about dividing a 401(k)
Obtaining a Qualified Domestic Relations Order is an essential step to dividing 401(k) assets between divorcing couples. The order, which should be prepared with an attorney, gives the parties discretion over how to split up the assets. Once executed, the order will give the former spouse the right to the assets, while protecting the account holder from taxes and penalties on withdrawals by the former spouse. The Wall Street Journal
(6/2)
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Recognize colleagues for their everyday, selfless leadership!
FPA's Leadership in Action program salutes the everyday achievements and contributions of those whose selfless dedication to their profession and community often goes unnoticed. Check out this month's Leadership in Action profile in the June Journal of Financial Planning, featuring FPA of Colorado member Karl Frank.
Do you know an FPA member who inspires others on an "everyday" basis, reminding us that we all have opportunities to lead? Nominate that individual for Leadership in Action recognition!
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Growth. Inspiration. Leadership. Success. Discover it all at FPA Experience 2012
From topics covering client engagement, longevity and core disciplines to global issues and optimizing portfolios and your practice, FPA Experience 2012 offers business-focused content for financial-planning professionals like no other conference. Register today and save $400!
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