As part of our ongoing commitment to helping financial advisors succeed in today’s challenging operating environment, CLS has created the AdvisorIQ education series, through which we publish actionable industry-related content designed to help advisors enhance their service offerings and run a better business.

Understanding Investors

An overview of the research

Globally, money and personal finances are one of the largest sources of stress for people. Despite the criticality of personal finances for our lives and futures, research shows a pervasive financial illiteracy at even a basic level of knowledge for most people. The knowledge gap in personal finances is not the only (nor the most predictive) factor influencing people’s financial story—nor are intelligence, statistical abilities, or wealth. Indeed, even if in an ideal world we were to pass a national initiative to increase financial knowledge through targeted education, the reality is that individual decisions about money and personal finances are often emotional and reactive, rather than rational or strategic.

This white paper answers the question, what if we took the broader notion of personal finances out of the equation, and focus specifically on investments and investor-advisor relationships?

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Bridging The Internal Succession Gap

Strategies for Managing the Transition Between Selling Owners and Employee Buyers

The next chapter of “Succession Planning: Reinvent Your Practice,” dives deeper into the “reinvention” strategy for internal succession. With a focus on the specific challenges of internal ownership transitions, this paper suggests actionable strategies for advisors to incorporate during a transition. In addition, it offers guidance in developing a framework for the long-term continuity for founding owners, their chosen successor(s), and the firm’s clients.

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As the wealth management industry continues to evolve, becoming more competitive and complex, advisors need to embrace new business models in order to remain successful. A key trend that is front and center in wealth management today is the movement by advisors to embrace fee-based business models and transition away from a commission-based transactional approach.

How can advisors who have yet to embrace fee-based business models take action and ensure their long-term sustainability in a rapidly changing industry?

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Reinvent Your Practice

Alternatives to Traditional Succession Planning

Due to the growing “sell your practice” message being promoted by industry experts, roll-up firms, and consultants, many advisors have become convinced that their only succession option is to sell their business. However, the lack of succession readiness for the majority of the industry, along with valuation issues, makes selling a practice a difficult proposition for the majority of advisors.

Fortunately, there are many alternative approaches advisors can pursue, such as “reinventing” themselves and their practices in order to continue working with the clients they enjoy, while streamlining their operations, and their practices. The reinvention option can empower advisors, in their later years, to continue doing the things they enjoy, lessen their workload, and continue to generate income to fund their retirement years.

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The Employee Retirement Income Security Act (“ERISA”) was enacted to provide minimum standards for retirement plans in private industry and to protect the interests of participants and beneficiaries of those plans. Many of ERISA’s rules are grounded in common sense concepts, the most familiar of which is the fiduciary status requirement. However, application of the fiduciary requirements can become quite complex in the ERISA framework.

Many sponsors of qualified retirement plans that qualify for special tax treatment under ERISA may not have the necessary experience to navigate the complicated fiduciary standards under ERISA. This white paper is intended as an introductory primer on the interactions between CLS’s qualified plan service offerings and the various fiduciary standards under ERISA.

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The Inefficiencies of Target Date Funds

Why a Managed Approach to Retirement Planning Leads to Better Outcomes

This report highlights the various features, benefits, and potential inefficiencies of TDFs, which are among the fastest growing options being offered as a Qualified Default Investment Alternative (QDIA) in many retirement plans.

Due to their unique structure, risks, costs, and limitations, TDFs have certain inefficiencies that may impact investors’ ability to meet their retirement goals. As an alternative approach, incorporating managed solutions that are individualized and customized to investors’ needs, goals, and life situations can be an attractive opportunity to enhance retirement plan investing choices and manage the limitations of TDFs.

By integrating managed solutions that utilize low-cost investments such as Exchange Traded Funds (ETFs) as part of the QDIA continuum, advisors, plan sponsors, and investors will have more choice, flexibility, and personalized solutions available to help meet retirement goals.

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Propel Your Business Forward

The Inside Track to Choosing and Implementing ETF Strategists

This report will identify the key industry issues facing advisors today that are threatening profitability. These include: volatile markets, increasing client demands for service, rising costs, and a more complex regulatory framework.

To succeed in these challenging times, leading advisors are adopting new practice management philosophies and innovative approaches to portfolio management by partnering with third party money managers who specialize in ETFs. These “ETF Strategists” can provide a cost-effective, scalable, and differentiated service offering that can help decrease the time an advisor spends on portfolio construction and maintenance, while increasing the time he or she allocates toward building profitable client relationships.

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Expand Your Referral Network

Tap into the $16 Trillion Qualified Plan Market through Partnerships with TPAs

This report identifies the key issues in approaching the $16 trillion qualified plan marketplace, particularly as recent Department of Labor changes and innovative investment platforms are opening up new opportunities for advisors.

Since the qualified plan market can be challenging to navigate alone, partnering with experienced Third Party Administrator (TPA) professionals and third-party money managers who specialize in innovative investment vehicles, such as ETFs, can be the solution to differentiate an advisor’s firm in this competitive marketplace. While many advisory firms are just getting started in this lucrative market, some leading firms are finding great success through these TPA and “ETF Strategist” partnerships.

Historically, advisory firms have built their businesses through referrals from centers-of-influence, such as attorneys and accountants. By targeting the qualified plan marketplace, advisors can discover a new referral partner with local TPAs that can turbocharge their growth.

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