Metro Washington Financial Planning Day

Metro Washington Financial Planning Day will be held Saturday, Oct. 28 from 9 a.m. – 2 p.m. at the University of Virginia Northern Virginia Center (7405 Haycock Rd., Falls Church). Free, private consultations on financial matters will be available with highly qualified certified financial planner professionals. Workshops on a variety of financial topics will be held throughout the day. Individuals can also learn about programs to become a certified financial planner (CFP).

Workshops will include: budgeting, credit and debt, investing, retirement, taxes, homeownership, estate planning, insurance and more.

The event is sponsored by the Certified Financial Planner Board of Standards, Financial Planning Association, Foundation for Financial Planning and the University of Virginia School of Continuing and Professional Studies.

The event is free and open to the public. However, registration is required at FinancialPlanningDays.org/DC.

UVA’s Northern Virginia Center is located across from the West Falls Church Metro Station on the Orange Line and just off of Route 7, Route 66 and inside the Beltway. Parking is free.



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Following LPL deal, Woodbury Financial poaches $435M National Planning firm

A practice with seven advisors and 3,000 clients left National Planning for Woodbury Financial Services after LPL Financial acquired the assets of their longtime broker-dealer.

Feucht Financial Group founder Mark Feucht and his sons Jeremy and Chad Feucht, who manage $435 million in assets under administration, chose the 25th-largest IBD, Woodbury announced this week. It marked at least the second firm to join a smaller IBD instead of LPL, the largest one, after the deal.

Feucht Financial Group, Woodbury Financial Services

From left to right, Feucht Financial Group CEO Jeremy Feucht, advisor Login Kinyon, advisor Laura Ingram, CEO Chad Feucht, chairman and founder Mark Feucht, advisor Jeff Nielsen and advisor Chad Muehlbauer joined Advisor Group’s Woodbury Financial Services.

Competitors such as Woodbury and its parent, Advisor Group, have been making the pitch to advisors like those of the Fond du Lac, Wisconsin-based firm. LPL purchased the assets of National Planning Holdings’ four BDs on Aug. 15, with plans to move 3,200 advisors to LPL in waves in November and early next year.

“When that went through, we did our due diligence for our clients,” says Chad Feucht, 44. “We looked around at several firms and Woodbury was just the absolute best fit.”

A spokeswoman for National Planning declined to comment on Feucht Financial’s departure, and a spokesman for LPL did not have a comment.

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Advisors on the Move: Wirehouses lose 12 teams with over $3.5B

ALL IN THE FAMILY
Mark Feucht, 70, launched the practice in 1974 and his sons came aboard after serving in the military in Iraq. Feucht Financial had been with National Planning since 2000, following 13 years with HD Vest Financial Services, according to FINRA BrokerCheck.

The transition of Feucht Financial’s assets to Woodbury’s platform will take about three months, Chad Feucht says. The suburban St. Paul, Minnesota-based IBD has now recruited 74 new registered representatives so far this year, out of 317 for the four Advisor Group IBDs, according to the firm.

Advisor Group recruiting

“Feucht Financial Group’s laser focus on putting clients first is in perfect alignment with the values that we hold near and dear at Woodbury,” Joe Nienhaus, the firm’s regional vice president for Wisconsin, said in a statement.

“Chad and Jeremy lead their company with the same ‘service before self’ mentality that made them so successful in their careers with the United States Air Force and Army, respectively.”

Woodbury’s roughly 1,000 producing reps took in revenue of $253.9 million last year, a 3% drop in line with an industry-wide slump. Advisor Group disclosed $1.3 billion in revenue from some 4,800 reps across Woodbury, FSC Securities, Royal Alliance Associates and SagePoint Financial.

Royal Alliance last month announced that it had grabbed a $350 million hybrid RIA from National Planning, as well as a $385 million practice from Signator Investors. Also in September, FSC Securities hired Derek Burke, the former president of Waddell Reed, as its new CEO.


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After LPL deal, $1.3B National Planning firm bolts for Commonwealth

A father-son firm managing $1.3 billion in client assets opted for Commonwealth Financial Network rather than remaining with National Planning through the transition of its advisors to LPL Financial.

Stuart and Michael Paris of Paris International “would have never left” National Planning if the firm’s assets had not changed hands in LPL’s big recent acquisition, Michael Paris said this week. The Great Neck, New York-based firm chose the fourth largest independent broker-dealer over the largest one.

LPL’s Aug. 15 purchase boosted its own prospects while helping recruiting efforts for its competitors. The boutique-like model of Commonwealth stands as an alternative to increasingly large firms like LPL in the bifurcating IBD space, a study found earlier this month. LPL is too big for Paris, Michael Paris says.

Stuart and Michael Paris, Commonwealth Financial Network

The father-son duo of Stuart (left) and Michael Paris (right) leads Great Neck, New York-based Paris International.

“It’s a significant cultural difference from where we were, where we chose to go and what would have been the do-nothing alternative,” Paris says, expressing concern that LPL’s status as a publicly traded firm gives it a greater fiduciary responsibility to its shareholders than its advisors.

A spokesman for LPL said he had no immediate comment on the firm’s departure. A spokeswoman for National Planning parent Jackson National Life Insurance, which sold the assets of its four National Planning Holdings BDs to LPL, declined to comment on Paris’ exit.

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Advisors on the Move: Wirehouses lose 12 teams with over $3.5B

CHANGE UNDER PRESSURE
Paris specializes in employer retirement plans while also offering individual advisory services, with about $1 billion in plan assets and an additional $300 million in individual client assets, according to Paris. His father started the practice in 1970, and it had been with National Planning since 1999.

The firm serves as an office of supervisory jurisdiction with a smaller footprint of four other registered representatives, Paris says. With a company motto of “give to give” rather than “give to get,” he and his father chose Commonwealth over several other potential suitors under a tight deadline early next month.

“Nothing like doing eight months of work in about two,” Paris says. “Commonwealth finished a very close second to NPC for us 17 years ago. The same people who welcomed us 17 years ago were the people who welcomed us today.”

Paris is also switching its custodian from Pershing to Fidelity’s National Financial Services under the move, he notes. The firm’s assets will move over “as soon as administratively possible,” with about 80% of the assets expected to make the transition within the next 45 days, according to Paris.

Commonwealth revenue chart

RECRUITING ‘FEAST’
Revenue at the firm’s new Waltham, Massachusetts-based BD rose 6% last year to $1.07 billion despite a 2.5% drop in total revenue among the nation’s 50 largest IBDs. Commonwealth serves 1,710 advisors managing about $92 billion in advisory assets and $52 billion in brokerage assets, according to the firm.

“This is a team that values relationships as much as we do and provides the same support to its clients that we strive to provide to the advisors we work with,” Commonwealth managing principal for business development Andrew Daniels said in a statement about the firm’s latest pickup.

Daniels has said the firm sees a recruiting opportunity in the LPL-NPH deal. The firm added 94 new advisors in the first three quarters of the year, and “we remain committed to careful growth with advisors and practices that fit our culture,” spokesman Todd Estabrook adds in an email.

National Planning recently lost two teams to Securities America and one to Royal Alliance Associates. Commonwealth, Cambridge Investment Research, Cetera Financial Group, Voya Financial Advisors and Ladenburg Thalmann firms loom large as potential landing spots, according to recruiter Jon Henschen.

One group of advisors told Henschen they were so exhausted by firms’ recruiting efforts that they began dozing off during a company’s technology demonstration. The LPL-NPH deal has prompted “a feast” for firms eager to peel off NPH advisors prior to their transition to LPL, Henschen says.

“They’re really busy doing home office visits and in discussions and getting offers and following up,” Henschen says. “I’ve had a hard time getting a hold of people.”


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Financial planners split on benefits of private equity investments …

Private equity firms’ influence on wealth management is undisputed. But is it beneficial?

For some top executives, not at all.

Such investments have proven to be “a very destabilizing thing for advisors,” according to Richard Lampen, CEO of Ladenburg Thalmann Financial Services, one of the industry’s leading independent broker-dealers.

Lampen, speaking at Fidelity’s Inside Track conference on Tuesday, cited the travails of Cetera Financial Group following an ill-fated investment by RCS Capital, adding that it was critical for advisors to know “how long [outside investors] will be committed to the space.”

Michael Farr, president of Farr, Miller Washington, a Washington, D.C.-based RIA, agreed.

“At some point, private equity investors need a sale,” Farr said. “They have to monetize their investment, and it will be disruptive.”

LONG HAUL PARTNER WANTED
Not all private equity firms investing in independents should be tarred with the same brush, contended James Poer, CEO of Kestra Financial, formerly NFP Advisor Services.

Private equity can be a “misunderstood category,” Poer said. “We’ve had private equity partners and it’s been a fantastic process for us. Good firms have a realistic understanding of how to achieve and can make significant investments. If you’re partnered with the right people, it can be a really successful relationship.”


“You can only grow so fast organically,” says HighTower’s Michael Bapis. Image: Charles Paikert

Advisor Michael Bapis stressed the importance of working with a private equity firm who understands the RIA business.

He also pointed out that “RIAs need to balance growth and scale, and you can only grow so fast you can grow organically.”

“You need funding, and private equity is where you can get it,” said Bapis, who is managing director of the Bapis Group, a HighTower Advisors firm in New York City. “The challenge is finding the right partner. Your visions need to be aligned, and you want them to support the business and stay out of the weeds. And you want a PE firm that is in it for the long haul and not just a trade.”

GET GUIDANCE BEFORE DEAL
For better or worse, private equity — and other outside investors — have discovered the independent advisory space and aren’t going away anytime soon, said Shirl Penney, chief executive of Dynasty Financial Partners, the New York-based platform services provider.

“Private equity is coming in full force,” Penney said. “For years, advisory-led firms weren’t big enough for the PE business model, but now they are. Private equity can provide growth capital for MA, take liquidity off the table and make strategic investments in areas like marketing and adding advisors.”

Major private equity deals this year include KKR and Stone Point Capital buying a majority stake in Focus Financial Partners and Long Ridge Equity partners taking a stake in Carson Group Holdings.

But Penney cautioned RIAs to seek legal guidance before making a deal with a private equity firms.

“Advisors need to understand all the terms of a PE deal,” Penney said. Advisory firm owners unfamiliar with the sometimes arcane conventions of private equity may come to regret their decision, he added.

For example, if a firm isn’t growing, “the principal may get less than he thought he would,” he warned.


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Rutgers unveils financial plan | $25M from the Big Ten next year?

“The projections in our roadmap for Big Ten Conference support are based upon public reports of expected conference distributions at the University of Michigan for FY2018 and previous public comments by Commissioner Jim Delany. Legally binding confidentiality agreements preclude us from sharing publicly the full details of the future revenues that we anticipate from our Big Ten partnership and related proprietary league information. We believe the revenue projections in this budget will prove conservative.

“Five years ago, I committed to reduce the direct support to Athletics from the University by $1m per year. That commitment is reflected in this budget. Direct institutional support for the Division of Intercollegiate Athletics will continue to decrease annually, until FY2021, when it will drop to zero. While roughly $2m in institutional support per year will still be required to support the administration of university Title IX efforts through the Division of Intercollegiate Athletics, no further direct support from the operating budget of Rutgers–New Brunswick will be required.

“This plan reflects the collective efforts of our Director of Athletics, Pat Hobbs, the new Senior Associate Athletic Director for Finance, Administration and Planning, Michael Szul, and Executive Vice President for Finance and Administration Michael Gower. Under their leadership, Rutgers Athletics has renewed financial clarity that will guide it through the foreseeable future.

“I hope that this information helps to resolve the concerns of some in our community about the University’s long-term financial plan for our Division I athletics program. As I have often stated, the program must become revenue-positive and financially self-sufficient, and this now-public financial plan is evidence of our University’s firm commitment to that goal.”

How Financial Planners Can Help Older Clients

I first took Manny on as a client 17 years ago, after I’d been in the financial-planning business for about a year. He was a 71-year-old widower at the time who had a sizable estate but was unhappy with his previous adviser.

Manny felt that he still wanted to maintain some stock-market exposure, but it was important that he start transitioning his investments to more of an income portfolio. That way, he could continue a regular gifting program that he’d started for his children and grandchildren.

After a review, we felt we could provide a more personalized service that Manny felt he was looking for. In addition, we determined we could lower his costs. We talked about my practice and how my process could work for him, and he decided to move his accounts to me.

The first thing I did was listen to Manny and understand what his financial goals and objectives were. Manny didn’t love paying taxes, but after identifying the fact that his objective was to generate more income to gift to his family, we realized that his investments would have to create taxable returns. So, we slowly increased his fixed-income holdings while continuing to dabble in the stock market, where Manny felt the most comfortable.

He would often come to hang out in my office. Manny loved watching CNBC, and he appreciated my company. But over time, it became apparent that Manny was slowly starting to lose his memory. He would still come visit the office, but not as often.

It turns out that Manny was suffering from Alzheimer’s disease, an absolutely insidious illness that robs its victims of any sense of humanity and dignity. But the real tragedy is that most patients aren’t otherwise sick and can suffer from Alzheimer’s for years. That was the case with Manny.

Fortunately, his kids were all local and very close to their dad. We worked in conjunction attorneys to make sure that Manny’s assets were all properly titled and that all of his beneficiaries were listed correctly.

Manny soon got to the point where he needed in-home care, and it was important to his kids that he stay in his home for as long as possible. We also made sure that Manny continued to gift money to his heirs, as the family strongly felt strongly that’s what Manny would want.

Hospice workers were eventually brought in, and they warned that Manny only had maybe six to nine months left to live. He suffered a brain bleed, he gained weight from medication, he wandered off one day — but Manny seemed to have nine lives and an incredible will to live.

Gradually, Manny started sleeping more and eating less, and his family decided to not wake him for food. It was time to let him go. That’s what Manny would want for sure.

Manny ultimately passed away this past January. He left an amazing legacy of humor and humility for his friends and family — but he left a legacy of financial preparation, too. We put a lot of hard work into preserving his assets and maintaining college money for the next generation.

As for me, I know that Manny appreciated both the planning that I provided and all of the time that we spent together. I lost a great client, a very close friend … and my dad.

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Virtual financial planning firm to begin offering services for Front Range Gen Xers, millennials later this month

A northern Colorado financial planning firm opening at the end of the month will target helping Generation Xers and millennials through virtual advising.

Level Up Financial Planning, founded by Lucas Casarez, a Fort Collins resident, will focus on helping younger generations that live along the Front Range, including Greeley, with their financial goals. He also will specialize in technology professionals and growing families of northern Colorado. Casarez said he plans to have his services — which include budgeting, investment management, student loan analysis, retirement planning and more — operational later this month at http://www.levelupfinancialplanning.com.

Level Up will serve its clients primarily through digital platforms, including a wealth management system that can build financial plans and a virtual meeting room called Zoom, where Casarez will be able to share his screen with his clients and offer meeting times at their convenience. He said customer convenience is the driving factor of his new business, as he knows from personal experience that it is hard to find time to meet with a financial planner in a fast-paced world where a lot of folks work 9-to-5s. He said he plans to leave a few evenings and Saturdays open for his client base as well.

Casarez noted generations X and Y typically don’t have the monetary means to have a personal financial planner, so he started Level Up Financial Planning to address this need. His business is collaborating with XY Planning Network, an organization of fee-only financial advisors, to use a monthly subscription model for his customers, rather than the traditional assets under management compensation structure. For example, at previous financial advising gigs, Casarez could only accept clients who reached a certain financial threshold. Through his subscription model, clients will pay a monthly base to receive their financial assistance services, allowing for more variety in demographics in Casarez’s customer base.

“For me, it was mainly about being able to help people who aren’t really being served,” he said.

Casarez said initial services will be conducted in-person, where he plans to meet with his clients at a public meeting space that is most convenient for them. Other than that, he’ll be working out of his home and conducting his services virtually. He said he hopes to have about 20 clients by the end of the year.

Casarez has eight years of experience in banking and three years working as a wealth advisor at a local independent financial planning firm in Loveland. He wanted to work with Gen Xers and millennials because he wanted to reach individuals and families earlier in life, after years of working with older generations.

“I just knew that if I could catch people earlier and educate them earlier, that there would be more (financially) successful people,” he said. “They’ll know where the stumbling blocks in life are and can get a head start on those things.”

Level Up Financial Planning

Level Up Financial Planning is a virtual firm that targets Generations X and Y as a customer base. For more information, contact Lucas Casarez at lucas@levelupfinancialplanning.com or go to http://www.levelupfinancialplanning.com, which will be live later this month when Casarez will officially begin to offer services.

Contest winner receives free car washes for a year from Financial Planning Center

CLARKSVILLE, Tenn. (CLARKSVILLENOW) – The Financial Planning Center recently conducted an online quiz on ClarksvilleNow.com that helped readers assess if they’re ready for retirement.

All who completed the quiz were entered into a contest and the winner received a deluxe car wash every day for a year.

Congratulations to Linda Brasher, who was recently chosen as the winner of the contest.

Financial Planning Center, LLP takes a holistic approach to retirement planning. Whether you need investment management or advice on maximizing lifetime Social Security income, they operate as a fiduciary. They can be reached at 931-358-3961.

Custodians see a robo in every advisor’s future

Custodians are increasingly calling upon advisors to become disruptors.

Trust Company of America follows Pershing and LPL Financial in offering robo tools to its advisor base, exhorting RIAs to make their own automated offerings for smaller accounts. TCA CEO Josh Pace discussed its partnerships with digital firms at the custodian’s Focus on the Future conference last week. One of the firm’s RIAs has already launched its own white-labeled offering.

Josh Pace, Trust Company of America

Trust Company of America CEO Josh Pace addressed the firm’s Focus on the Future conference last week.

Pace stresses that TCA would never try to imitate the client-facing robos of giant competitors like Charles Schwab and Fidelity. The smaller custodian’s approach does, however, provide the firm’s 225 RIAs and 7,000 advisors with an automated tool like one ushered in by LPL for its advisors.

“They’ve got their high-touch wealth management office. They may want a robo solution that uses their strategies but it’s lower-touch, lower price point,” Pace says, noting TCA’s integrations with the Emotomy and Riskalyze Autopilot platforms. “So they can just spin up their own robo.”

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EARLY ADOPTERS
Chicago-based Interactive Financial Advisors set up a robo offering for its 57 affiliated advisors in the past year, according to chief compliance officer Joanne Woiteshek. The tool creates a portfolio for accounts starting as low as $1,000 after clients complete an investment strategy questionnaire, she says.

“We can do it for any-size accounts but we’re trying to pick up speed with smaller accounts,” Woiteshek says.

Another TCA partner named USA Financial, a Grand Rapids, Michigan-based RIA, broker-dealer and TAMP, is examining starting a robo tool over the next year or so, says COO Matt McGrew. The firm has 270 affiliated advisors and about $3 billion in assets under management and administration.


USA Financial wants to figure out a way to craft its offering without constructing the client’s portfolio through “six or seven questions” like popular robos on the market today, McGrew says.

“That’s not how we train our advisors to work with their clients. You have that feel and that dynamic in a robo environment,” he says, predicting automated advice loses novelty and becomes commonplace, like satellite radios.

“Now, they’ve just become a component in your car. I think we’re going to see robos go down the same path.”

ADVISORS AS ‘JUGGLERS’
In the opening address of the conference last week, Pace touted TCA’s integrations with other firms as a key area of accomplishment in the past year. The firm recently unveiled a partnership with Fi360 to use the Fiduciary Focus Toolkit on TCA’s Liberty platform for enhanced compliance under the fiduciary rule.

On the other hand, Pace acknowledged TCA has yet to finish a tech tool allowing for remote check scanning and needs to do better in eliminating paper account statements. He described what the custodian, which has $17 billion in assets under custody, sees as the advisor and RIA of the future.

“They have to be good jugglers,” Pace said. “It’s not only that they have a toolkit, but they’ve got to know how to use it. And that’s where I see a gap.”


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