MichaelKitces
@MichaelKitces
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One nerd’s perspective on the financial planning world… CFP, #LifelongLearner, Entrepreneur-In-Denial, Advisor #FinTech, & publisher of the Nerd’s Eye View blog
Joined October 2008
Our list of "Best Conferences 2025!", and be sure to take advantage of the discount codes that several have offered to Nerd's Eye View readers! . Best in:.-Overall Planning: @FPANorCal.-Technology: @t3techhub.-Advanced Tax Planning: @AICPA Engage.and more!.
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Huh. Who would have thought THAT is where Spicer would draw the line?
.@PressSec resigned after vehemently objecting to appointment at 10 a.m. Friday of Anthony Scaramucci as WH Communications director, per SAO.
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Just got the infamous (for advisors) question that prospects often ask: "what % return should I expect to get if I hire your firm?". Feeling compelled to take a few minutes & explain why this is NOT what any consumer should ever ask when trying to vet a financial advisor. (1/?).
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No negative market returns over rolling 15 year periods. The 'worst' average annual growth rate was 8% over 30 years. Charts like this never get old to me. ) Thanks, @awealthofcs!. "4 Charts That Explain the Stock Market"
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Infuriating. Insurance salesperson poses as a "financial advisor", gives a "plan", uses it to sell unwanted product. THIS is why we need a fiduciary standard. "r/personalfinance - My husband and I are idiots. We've been bamboozled by a financial advisor."
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Bold subtitle here: "Buying new cars is like taking $40,000 and setting it on fire". To be fair, NOT buying cars no guarantee of riches. But regularly buying new ones DEFINITELY sets you back. "The road to riches is this simple: Drive a crappy car"
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After last night's initial pass, reading through the Tax Cuts and Jobs Act legislative text in deeper detail today. Full write-up coming to Nerd's Eye View blog on Monday morning. In the meantime, will be sharing some (threaded) highlights here. .
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Fiduciary is for advisors. Suitability is for salespeople. If you understand the difference between advisors & salespeople, you already know all you need. "What you need to know about the difference between fiduciary & suitability standards for advisors"
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It's NOT a big win for the "financial services" industry. It's a big win for the financial product manufacturing and distribution industry. Not the same thing.
NEW: Appeals court shoots down fiduciary rule - perhaps Obama DOL’s top regulatory priority - in big win for Eugene Scalia, Chamber, financial services industry. This may provide major relief for @SecretaryAcosta, too. @CCastroPagan
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Umm. you mean because Wealthfront has almost $10B of AUM and the equity markets were up nearly 1% yesterday?. Kinda important to distinguish between actual flows and passive market returns if you're going to talk about growth.
Fun fact about @Wealthfront: yesterday we grew our assets under management by more than $100 million. It took us 13 months to attract our first $100 under management. We can't thank our wonderful clients enough for making this possible!.
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Powerful chart from @awealthofcs about how it all averages out in the long run. The orange bars are 1-year returns in the market. The blue line shows the rolling 30-year returns. Amazing how stable it is in the end. ?. "One Year Returns Don't Matter"
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I'm all for having full disclosure of criminal history on BrokerCheck, but. FINRA: Do you have any past crimes to disclose to investors?. Advisor: Well, 49 years ago I once got caught stealing a can of tuna fish and a package of cheese. FINRA: DISCLOSE IT THOU SHALT!
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Fisher Investments has $114B AUM, and spends 6% of revenue on marketing and advertising. (Average advisory firm is <2%). WHY does Fisher spend 6% of revenue on marketing and advertising? I can think of $114B reasons. "Why Ken Fisher Advertises So Much"
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Why I advocate the use of Monte Carlo analysis. "I'd rather be vaguely right than precisely wrong." - Keynes.
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Whew, round 1 is done! . No significant side effects so far beyond a mild headache! 🤞
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Love this simple visual from @dougboneparth on showing the value of financial planning. Investments is just one small channel of the bigger picture. "RIAs must move beyond investments to justify fees"
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Wait, the proposed solution for people taking on too much student loan debt to go to college is to give them financial education classes AFTER THEY'RE IN college about loans they've already committed to? :/.
Treasury Dept. says student-debt crisis is so bad that financial education should be mandatory for college students
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This is a tough graphic to own as a financial advisor. Only 3.2% of households have >$1M in their retirement accounts; just 7.2% have $500k+. Are our 'typical' clientele actually a lot further from the 'typical' American than we realize or care to admit?.
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Question to Advisors - what materials are you using to show clients historical context of market volatility? (Prior drawdowns and recoveries. Prior incidents of markets and disease? Etc?). Curious what organizations are producing helpful materials as talking points w/ clients?.
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Fascinating chart from Vanguard. Red line is target date funds. Blue line is median of actual Vanguard investors. Target date funds get more conservative by age 70 than where 75%+ of retirees ACTUALLY invest. Do we overstate retiree risk intolerance?.
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Wow. @CharlesSchwab launching $3.5M endowment to support Black college students pursuing financial planning. $20k scholarship ($10k for Jr year, $10k for Sr). 👏. Notably, Schwab itself is 32% non-white. "Schwab Establishes Endowment for Black Students."
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Wealthfront: We'll compete by paying the highest money market rate there is, even if we have to subsidize and lose money on it, to get new clients who may be profitable in the long run!. Betterment: Hold my beer. .
Betterment launches Everyday Savings, a cash management account offering 2.69% APY
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And. it's out! Our new list of conference recommendations for 2020! Now with a new 'Master List' of all industry conferences (for advisors, and vendors looking for exhibitor opportunities!). "20 Best Conferences For Top Financial Advisors In 2020"
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The 1% AUM fee has faced criticism from those who argue that it reduces the value of a portfolio by more than the advisor's guidance adds. Kitces Researcher @derektharp writes how advisors who lead with holistic planning have a lot of value to demonstrate.
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The 16 Best Conferences For Financial Advisors To Choose From In 2019
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Heh. RT @sadmonsters: Trump claims no one cares about his taxes. The next mass protest should be on Tax Day to prove him wrong.
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As HuffPo shuts down its contributor network, yet ANOTHER reminder to financial advisors: own your blog and website and content. Period. Don't build on Facebook. Don't build on LinkedIn. Don't build on contributor networks. Own your land. "Owning Yourself"
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Pretty cool visualization via @Riskalyze of the risk of various asset classes. (Number in the upper left of each box is Risk Number rating.). "Periodic Table of Asset Classes"
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Notice how suddenly they're willing to admit they're not in the "advice" business anymore, and now that it's hitting home for them, it's simply about offering "transactional brokerage services"? . Will that match their future marketing if Nevada walks back their fiduciary rule?.
Morgan Stanley, Charles Schwab, TD Ameritrade and Wells Fargo, have all submitted letters to the state warning that if the fiduciary rule took effect, it would effectively eliminate access to low-cost, transactional brokerage services for Nevada residents.
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Advisors: Some amongst us mocked Bitcoin and the (often young) investors who chased it during its bubble-like rise. But show some empathy for those experiencing REAL losses as Bitcoin crashes. Or we'll end out with a generation so scared they'll end out eschewing ALL investing.
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It's out! Our annual list of the "15 Best Conferences For Financial Advisors To Choose From In 2017"
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Lots of buzz about whether #ChatGPT will replace financial advisors. But the irony is even ChatGPT doesn't think will replace financial advisors. 🤣 .- Deeper expertise.- Personalized service.- Emotional support.- Help w/ difficult decisions.- AI is a tool, not a replacement.
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Woot! It's out! Our annual Financial Advisor Conferences list - with a big focus this year on Scaling Up - scaling your marketing, your advice, your business, and yourself!. Finding The ‘Best’ Financial Advisor Conferences In 2023
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Good to see. With a whopping 76% of 403(b) assets held in annuities (compared to only 10% in 401(k) plans), apparent SEC sweep into 403(b) sales practices is LONG overdue. "SEC probing compensation, sales practices in 403(b) plans for school districts"
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This is a really cool list of platforms where you can earn money via a side hustle. For advisors & other business owners, also a really cool list of potential platforms you could USE to outsource stuff yourself! :). "150 apps/websites for earning money"
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For any furloughed government employees looking for pro-bono (free) financial advice to get through a difficult situation, just go to XYPN's "Find An Advisor" page at and search by the "furlough" keyword to find advisors ready and willing to help.
More than 60 CFP®s from XY Planning Network have stepped up to provide free financial advice to furloughed federal employees during the #governmentshutdown. A special thanks to XYPN member Kevin Mahoney (@illumintCEO) for kickstarting this initiative.
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HOLY CRAP. A "glitch" in the Citigroup electronic feed was showing stocks rated as "Buy" when the actual analyst rating was "Sell". For. Four. Years. Not sure what's worse. That it happened so long. Or that no one even noticed for so long.
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12 Best Conferences For Financial Advisors To Choose From In 2016: http://t.co/SS1Ev9NQA6
http://t.co/uaX48PPSSk.
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Got to catch up w/ @ramit at @kramerbooks in celebration of his new "I Will Teach You To Be Rich" Journal. His "I Will Teach" book is still my first recommended to 20- and 30-somethings that need to get oriented around their money (and their debt!). Great to connect in person!
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Everything that's wrong with advisory industry designations, in one email ad that just hit my Inbox. :/ . BOGO deals are for the grocery store or a side of fries. Not the education & competency of a financial advisor helping a client with their life savings.
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The "Iceberg Illusion" of watching other financial advisors succeed. So much truth.
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@EamonJavers @foxjust Many of these debt and especially equity investments wouldn't be shown on ANY tax return. Investing itself isn't a taxable event. .
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Interesting research. And some rather negative implications for the world of financial advisors. Do advisors who are less confident in their growth and find it harder to get clients tend to use more jargon? Does your language shift as you gain confidence in your pricing & value?.
Jargon isn't a sign of expertise; it's a signal of insecurity. 9 studies: when people lack status, they resort to unnecessarily technical language in an attempt to look smart. When they have status, they're more concerned with communicating clearly.
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It's out! Our annual list of "The 13 Best Conferences For Financial Advisors To Choose From In 2018" -
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Sometimes advisory firms have to actually live through a bear market before learning the hazards of selling performance results. :/
Since our inception 6 years ago @Wealthfront generated a 10.02% avg annual return (on a risk 8 portfolio) despite 4 market corrections. That does not include tax-loss harvesting benefit which could have added up to 2.25% annually depending on your tax rate
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If financial planning is going to be a recognized profession, we need to expose the 'art' of financial planning to academic rigor.
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If financial planning is going to be a recognized profession, we need to expose the 'art' of financial planning to academic rigor.
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Common sense as always from @awealthofcs. “You’re never going to get caught up in a Ponzi Scheme investing in a total stock market index fund.".
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We lament the commissions & conflicts of interest associated with certain annuity sales. But for the moment, I'm just wondering what regulator approved this as a product as being appropriate for consumers in the first place? Why approve products for retirees w/ 16 yr surrender?!.
This is Suitable? 16 year surrender fee for a retiree? 90% of her net worth in illiquid investments. This is why we do what we do. Retired teachers and Police Officers deserve better than this.
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Why did @ritholtz partner w/ @betterment4advisors despite existing RIA custodian relationships? B4A was only one to fully automate onboarding a new client from website w/o human touching ANY part of it. Striking indictment of how RIA custodian tech is still lagging? #InVest19.
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Why I advocate the use of Monte Carlo analysis. "I'd rather be vaguely right than precisely wrong." - Keynes.
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Strong words from @ReformedBroker about dismantling of @CFPB consumer protections. Like Josh, I'm a business owner & no fan of unnecessary & burdensome regulation, but we need more accountability in the #FinServ industry. This is a step backwards.
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Life is full of financial trade-offs. A financial planner can help you evaluate the pros and cons of each. :). “A 2 Million Dollar Bugatti Veyron parked in a mobile home park. This guy either has it all figured out, or nothing figured out at all.”
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Dear Wholesaler: If you're reaching out "to learn more about my business", read my website & ADV. Stop calling me & leaving messages. Thx.
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Wow. This chart of student loan debt makes the rest of the financial crisis leverage seem like a minor blip.
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Nice @awealthofcs reminder how volatile returns (in stocks & bonds) still average out in the long run. As Graham famously said, in the short-term markets are a voting machine, but in the long term they're a weighing machine. "Stocks For the Long Run"
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5 Questions People Don’t Ask Their Advisor (But Should). Will you:.- Put "fiduciary" in writing?.- Run a tax projection?.- Review estate planning documents?.- Explain how you get paid?.- Explain what happens if something happens to YOU?. @PeterLazaroff
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Wow. RT @position_trader: The best explanation of financial freedom I have read. From an advertisement in the 60s. Worth a read.
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#Advicer Question: are you producing any kind of annual report/summary/deliverable to clients to demonstrate all the 'stuff' you did for them (e.g., the value provided) throughout the year?. If so, what do you use to produce, & would you be willing to share it w/ other advicers?.
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So excited to see the new @XYPlanning offices coming together! We'll be moved in by the end of the month! (Or so the contractors claim. )
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Advicers! We're compiling a list of the top podcasts for financial advisors. Let us know your favorites in the thread - they can be on practice management, technical topics, market/economic commentary, leadership, or other issues that are important to you as an advicer!.
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Getting underway for #XYPNLive - so excited to spend a week talking about fee-for-service financial planning and how to scale an advice business!
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I've completely stopped answering my cell phone unless it's specifically someone I know (and want to talk to!). Everything else just gets screened to voicemail. So many robo-calls it's not even worth trying to answer unknown numbers anymore. :/.
Serious question: Is there any point in picking up your phone for a number you don’t recognize? .It seems every time it’s a robo call. If it’s an actual person, they’ll leave a message or do the civilized thing and just text.
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Wagner's rules of financial planning success:.1 Spend less than you make.2 Save as much as you can.3 Don't do anything stupid.
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As always, @ReformedBroker channels what we're all feeling. Market rebounds and stimulus checks will help, but let's talk about some Wins in fighting this disease. How many recovered and immune? Positive survivors? Progress? . "We Need Some Wins"
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If financial planning is going to be a recognized profession, we need to expose the 'art' of financial planning to academic rigor.
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Always fun to look at these charts and remember how negative it felt at the time/in the moment when the 'scary thing' was happening (and it really was scary at the time!). "The case for (always) staying invested"
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Software that takes a full PDF of a tax return, and in 7 seconds turns it into a detailed tax summary with practical planning tips and recommendations. "#XYPNLIVE FinTech Competition: Bionic Tax Planning Takes First" via @slsteinberger
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The "Iceberg Illusion" of watching other financial advisors succeed. So much truth.
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Big news out that @Wealthfront is being acquired by UBS for $1.4B. In and of itself, that's an incredible accomplishment, but more interesting when you look at it in context of the broader industry & "robo" movement. (1/? thread).
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Been trying a new 'high intensity training' workout routine for the past 2 weeks. Already managed to work up to a full 1-minute plank. (Small wins!). Have to admit I'm impressed how much a 'short' 7-10 minute HIT workout is building results quickly.
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Why I advocate the use of Monte Carlo analysis. "I'd rather be vaguely right than precisely wrong." - Keynes.
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I think it's sad that when the OVERWHELMING majority of consumers don't get financial planning at all, that Wealthfront is so small-minded as to think it's humans-vs-robots, instead of recognizing that we each serve different consumer types with different needs. #Abundance.
Ouch, @Wealthfront "Financial planning and advice does not need to be delivered through a person," said company spokesperson Kate Wauck in a statement. @MichaelKitces What do you think about this statement, pretty bold if you ask us?.
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eMoney & MGP noting they, too, have one-page 'snapshot' view similar to what RightCapital launched. But pretty striking when you look at them how distinct RightCapital's is?. Which do you like best?. "RightCapital Debuts One-Page Financial Plan Snapshot"
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Now we know why E*Trade agreed to put Vanguard funds on their NTF platform without a back-end fee. Because if they didn't, Vanguard was going to undercut them anyway. This is a bold way for Vanguard to put pressure on back-end custodian NTF payments! Love it!
Wow, Vgrd announcing ALL (non-lvrg) ETFs will now trade commission-free on their platform. Previously only Vgrd ETFs traded for free, so basically 1,720 ETFs just went from $7/trade to free. Dayum.
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Nothing like end-of-year meetings with clients. "What's that? Today you've decided to open the individual 401(k) we were recommending all year? Sure, no problem. it's only December 28th! :)" .
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A rare visit thru NYC! Catching up with the awesome @RitholtzWealth team! Thanks @krisvenne @billsweet @michaelbatnick @BlairHduQuesnay for coming out! We missed you @ReformedBroker @ritholtz!
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Exciting news - the Kitces #Nerd clan will grow by 1 more in 2016! (Yes, there's just 1 baby in there - we verified!) http://t.co/rmVapyvWzJ.
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Interesting way to frame this. The left is how the investment pyramid looks with a financial salesperson. The right is how it looks with a financial planner?. "The Real Financial Planning Pyramid" via @iris_xyz @jwilsonsc
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If financial planning is going to be a recognized profession, we need to expose the 'art' of financial planning to academic rigor.
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Schwab 2019 trading revenue dropped 19% to $617M. Net interest revenue (i.e., on cash sweeps) grew 12% to $6.5B, now 61% of total revenue. Financially, Schwab is a bank w/ a brokerage & RIA custody side hustles?. "Schwab Client Assets Hit $4T Milestone"
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We have put together our first-ever list of 'Top Podcasts' For Financial Advisors in 2025, with a focus on how to find the 'right' podcasts that fit their needs! Best for Practice Management: @EfficientLibby, @ThePerfectRIA, The Advisor Journey.and more!
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RIA custody is "free". but they're pushing ETF providers for 15% rev-shares? Which means clients are paying, we just can't really tell how much they're being charged?. "‘A step back in time’: Fidelity slammed for plans to charge new ETF fees"
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How Life Insurance Loans Really Work And Why It’s Problematic To “Bank On Yourself”
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Heh, kudos to whoever on the @MorningstarInc #MICUS team made this the 404 page-not-found error message on the Morningstar website. Very witty. :)
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Fascinating look at (inflation-adjusted) statistics of young adults today vs 30 years ago. College costs & debt much higher while median income is flat. leading directly to delayed marriage & reduced homeownership?. “How do you start a life these days?”
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Welcome Zachary Chongjoo Kitces, born 7lbs 4oz on Feb 22! Mom & baby doing great!
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Really like this "Investment Pyramid" modern portfolio construction approach from @MebFaber.
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Umm. probably the fact that businesses still need to generate revenue to pay their employees? Just a guess.
Zero-cost planning for all: What's stopping an advisor's greatest fear?
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If everything in the portfolio went up at the same time, it would mean you're not diversified!
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I understand estate tax concerns, having worked w/ many clients to plan around it. But striking @Ritholtz data - 6M small businesses & 2M family-owned farms, only 80 faced any estate tax in 2017. "Estate Tax Gets a Lot More Attention Than It Deserves"
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Neato. Utah @my529 plan rolled out a prepaid Discover card to make it easier to purchase eligible books & other college expenses direct w/ 529 funds (no more pay-and-reimburse-yourself approach!?). "Announcing the my529 Access Discover® Prepaid Card"
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Wow, this hit close to home. (Explains a lot about my writing style 🤣).
the ADHD urge to use parenthesis in every sentence (because every thought comes with additional bonus content).
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Not clear if it will gain momentum to pass Congress, but good to see it's under consideration. Would allow 'excess' unused balance from 529 plans to roll over to a Roth IRA for retirement. "New Bill Would Allow Rollovers From 529 Plans to Roth IRAs"
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Traveling so much for speaking engagements is hard with the little ones at home. But it warms my heart when they leave surprises in my office for me to find when I come home. :)
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Wow, how the dynamics of robo-advisors have shifted. Getting desperate for growth leads to marketing compromises. This is precisely WHY advisory firms have such stringent marketing requirements!. "SEC Charges Wealthfront & Hedgeable With False Disclosures"
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