Weekend Reading for Financial Advisers: Taxes, Situational Awareness, and Giving Back

It’s no secret that financial advisers who want to succeed need to understand a range of complex subjects — not just investing but also tax and estate planning, retirement planning, and philanthropy, to name but a few. With that in mind, here are some compelling reads from the past week for the well-rounded adviser.

Tax and Estate Planning

• “Before The Door Closes: Tax Planning for 2012” is a great recap of where things stand and what could change in 2013. It is also available as a webinar. (US Trust)
• See also “Four IRA Deadlines Every Smart Investor (Or Advisor) Should Know.” (Forbes)

Behavioral Finance and Lie Detection

• Bob Seawright had a fascinating blog post about a controversial 9/11 photo and how it relates to behavioral biases. (Above the Market blog)
• See also “5 Ways to Avoid Natural Reactions that Prevent You from Making Good Decisions,” which looks at five “notorious social biases” and discusses “ways that you can recognize and react when your brain is trying to pull a fast one on you.” (Buffer)
• My colleague and fellow content director Jason Voss, CFA notes that in finance, the ability to root out the truth is critical, “from analysts reading between the lines of a chief executive’s comments to private wealth managers trying to understand their clients’ actual financial motives.” And yet detecting lies remains very hard. In this article, he explains why it’s so tricky. (Financial Times)
• Barry Ritholz had an interesting piece on “situation awareness” and the tendency, of late, for equity traders, bond managers and prop desks to go “full on wonkasaurus,” especially when it comes to the Fed and “helicopter Ben,” while forgetting “their job is to manage risk and seek opportunity.” (The Big Picture)

Retirement Planning

• Will your income needs trend down as you age? The data may say yes, but there are some important considerations to bear in mind. (Morningstar)
• In its latest paper, the Institutional Retirement Income Council (IRIC) provides some perspective on six retirement risks: sequential risk, inflation risk, longevity risk, interest rate risk, health care risk, and behavioral risk. (IRIC)
• A must-read for advisers with couples and/or single female clients nearing retirement: “Five Crucial Pieces of Retirement Advice for Women.” (BenefitsPro)

The Industry

• The nation’s biggest brokerages are apparently ramping up their efforts to transition clients to flat-fee managed accounts and away from the traditional transaction-fee model. (WSJ)

Philanthropy

• John “Jack” Bogle, founder of Vanguard Group, has a net worth “somewhere in the low eight figures.” So what exactly does he do with his money — and what advice does he have for the rest of us? Reuters sat down with him to find out. (Reuters)

And now for something completely different:

• A Renoir painting that had not been seen since 1926 turned up at a West Virginia flea market and is set for auction this month. It could fetch $75,000 or more. (AP)

For more news and trends, visit the Private Wealth Management Community of Practice.

Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.