Carl Richards and Cathy Curtis have written eloquently about financial advisors' (financial planners,' you pick the label) image in recent columns. The gestation was the comments section of a Your Money column in The New York Times, which was filled with disdain for advisors. As the article was in the NY Times, more cynics may have opined negatively due to their own personal experiences with brokers (and other Wall Street types) residing in New York City. We all know there are many outstanding planners across the country. It is difficult for the public to locate fee-only, fiduciary, client-first CFP®s. Fee-only planners' marketing budgets pale in comparison to the fog-horns of Wall Street.

Undoubtedly, differentiation is critical in the RIA space for the industry to survive the recent scandals. Pending new regulatory legislation could further place a wall between investors and their advisors in regard to differentiation, as brokers appear to have the upper hand in commoditizing the business and the labels attached to fee-only planners.   More 

As a passive investor, my use of ETFs has been confined to holding a large, highly liquid major ETF index while waiting for the wash rules to lapse. For example, if Vanguard Total Stock Market VTSMX was sold for tax-harvesting reasons, shares of Vanguard Total Stock Market ETF VTI could be purchased in portfolios to maintain proper exposure. After the wash rules expire, the mutual fund could be repurchased. Other than this option, passive low-cost index mutual funds are the preferred investment vehicle for client portfolios. Why?   More 

It is no surprise that the primary question clients currently field is, "How high is inflation rising?"

Many remember the late 1970s and early 1980s when inflation was about 14%. With the Obama administration and Congress spending at the highest rate in our country's history, this topic is front and center in clients' concerns. After the meltdown of the baby boomer's portfolios this past year, a second blast from inflation would severely erode their purchasing power. Not all of our clients bailed to fixed income, but many investors did. If inflation returns, their new, bond-heavy portfolios would suffer, and investor confidence in the capital markets would plunge. I encourage advisors to understand inflation and its root causes.   More 

An arcane, outdated IRS Code once again creates an income tax nightmare for financial planners (and by extension our clients) concerning conversion of tax-deferred accounts to Roth IRAs. The rules for this conversion are ripe for errors, as the tax code is not specific or detailed in scope. Financial planners are urged to use extreme caution and begin planning now. Bringing competent CPAs on board as part of the decision team is strongly advised. The dilemma: to convert or not convert. Traditional IRAs, SEPs, Simple IRAs, and 401k plans to Roth IRAs.

Beginning January 2010, clients may receive all the benefits of a Roth IRA--no income requirements, tax deferral, and low balances in accounts due to the market meltdown (the recent market upswing withstanding). Further, the IRS Code provides for income tax to be paid over the next two years (2010 and 2011 and 2012) in a 50%/50% equal split for conversions. Tantalizing, yes, but does it make sense?   More