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While advisors agree with the overall concept and spirit of the Department of Labor’s fiduciary ruling, concerns ring aplenty, as the vast majority have yet to be convinced that the new legislation will deliver on its intent. First and foremost, advisors lament that the DOL fiduciary ruling is casting an overall negative industry gloom and is fueling investors’ focus on fees.
Perhaps even more importantly, advisors believe that the DOL action is forcing them toward a fee-based compensation structure and limiting their product selection. As such, advisors fall into two camps: those who are already fee-based see the DOL action as formalizing an inevitable market shift, while commission-based advisors fear that commoditizing their service puts them at greater risk of being undercut by cheaper automated advice services.
In addition, making the advisory role even more onerous, advisors indicate that their personal liability concerns are heightened due to the increased volume and scope of internal and external regulations. As a result, many advisors report feeling increasingly monitored rather than supported by their firms.
In the context of all of these challenges, advisors remain open to business-building ideas to improve their expertise and are committed to working strategically to future-proof the industry. Advisors welcome any technological advancement that can alleviate administrative tasks and enable them to focus on more customized service. Last but not least, advisors indicate a need for wide-ranging promotion and advocacy creating
transparent messaging for clients and presenting a united front to government regulators.
The Advisor of Tomorrow™ report examines new expectations for financial planning and advice. Advances in technology, tightening fiduciary regulations and new expectations from the Millennial generation are raising the standard of investment advice and causing financial advisors to significantly adapt their strategies. As the landscape changes, advisors are looking beyond today to be ready for tomorrow. These groundbreaking focus groups reveal what tomorrow’s financial advisor will look like and what types of support they will need. For more information, review an overview of the full report including the table of contents and list of exhibits.