The Wire

April 24, 2020

‘It’s the ultimate reset’: How lockdown can improve UK and US financial planning

In the third and final part of our US and UK financial planning discussion, we take a look at what firms might learn from the lockdown and how they might come out of it stronger.

Steps taken to focus on planning and listening seem more prudent than ever, and efforts to distinguish between the value of financial planning, and fluctuations in the markets, seem increasingly worthwhile.

April 9, 2020

RIA M&A: What's Next in Early 2020?

Many RIAs are spending time taking care of their clients and employees while assessing the financial impacts of COVID-19. As the industry gets used to working remotely and adjusting to market volatility, new questions about macro RIA trends have surfaced. 

What will happen to RIA M&A?  

March 31, 2020

Coronavirus stimulus loans could tempt RIAs

Partially forgivable loans from the Small Business Administration (SBA), made available as part of the federal government’s $2tn stimulus designed to blunt the coronavirus’ economic impact, could soon become a standard recommendation for RIAs’ small business owner clients.

But could they soon become a useful tool for advisory firms themselves?

March 27, 2020

This may be the time for RIAs to rethink fee models and costs

The coronavirus crisis may provide an important opportunity for RIAs to rethink their business models. 

John Furey (pictured), managing partner of RIA consulting firm Advisor Growth Strategies, said firms facing thinner profit margins should take this opportunity to sort their needs from their ‘nice to haves’ and to reexamine how they operate their businesses and compensate their teams.

March 24, 2020

The RIA Profit Margin to Weather a Pandemic's Recession

Asset-based fee revenue at wealth managers plunged this month alongside the fastest-ever bear market in response to the novel coronavirus. At RIAs with thinner profit margins, that could mean drastically lower compensation and even cost-cutting.

In 2018, the median operating profit margin for RIAs managing between $100 million and $250 million was 28.9%, net compensation costs. RIAs that managed more had relatively similar margins ranging between 26.4% and 30%, according to Schwab Advisor Services’ 2019 RIA benchmarking study, its most recent annual report than surveys more than 1,300 firms, which self-report.

March 24, 2020

Some RIAs Vow To Keep All Staff In Place

A number of registered investment advisory firms—including some well-know billion-dollar shops—are vowing to hold on to all of their talent as the coronavirus challenge continues despite anticipating a sharp haircut to revenues.

According to advisors Financial Advisor magazine talked to across the country, retaining staffing is a priority to firms as they ramp up customer service and communication. That’s despite what is likely to be a 30% decrease in assets and revenues for advisor firms for the foreseeable future.

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