MichaelKitces

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! bit.ly/4fisUpb

Understanding the difference between tax planning and tax advice is crucial for advisors seeking to stay on the right side of this liability line. Tax planning may involve discussing general tax rules, modeling hypothetical scenarios, or analyzing the tax impact of strategies for the client – without actually making concrete recommendations. Tax advice, by contrast, involves discussing specific actions with tax consequences, which can expose advisors to significant legal risk, particularly when clients interpret such statements as recommendations. kitc.es/40J1NOC #taxseason #taxplanning

Virtually no client searches for a financial planner to help them "find purpose". In this episode, we discuss the tension between the deep, transformative work advisors offer and the initial (transactional) problems that bring clients to advisors in the first place. kitc.es/4rttV3w The profession’s highest value may not lie in spreadsheets or portfolios, but in guiding clients through the intersection of money and meaning. The marketing dilemma, then, is how to communicate this deeper value without resorting to clichés like "peace of mind" or abstract promises of transformation. #financialadvisorpodcast #podcast

The industry buzz is all about the threats of fee-compression (from tech, from AI, from, from, from...), and even more so for advisors who charge standalone planning fees for services (as opposed to AUM fees). Yet in practice, AdvicePay report finds amongst advisors themselves, 54% plan to keep their fees steady, 45% plan to RAISE fees, and only 0.50% of plans to decrease their fees. Median subscription fee is $291/month (which adds up to ~$3,500/year, or very similar to the minimum fee/asset requirements of AUM firms anyway), as demand for advisors who charge planning fees continues to rise... "AdvicePay Report: Fee-For-Service No Longer a Niche Model" kitc.es/3NGWJYl

Why Marketing Costs Struggle To Scale Along With Firms: When most advisors think of marketing costs, they think of the hard dollars spent on marketing goods or services (e.g., the $6,000 per year for an AI-assisted prospecting tool, $450 per year to be listed in various directories, $2,000 per year to host a seminar at their office, or the cost of a small "thank you" gift for clients who refer their friends).  However, such expenditures alone do not account for the time advisors (and their staff) require to carry these marketing efforts through to completion. In this article, Kitces Director of Research Mark Tenenbaum and Senior Financial Planning Nerd Sydney Squires discuss why a firm's organic growth slows as the firm matures – and how firms can resist and even reverse this effect. kitc.es/3OTf4ld #advisormarketing #advicers

Helping clients articulate meaningful goals is often more difficult than it first appears. Many feel uncomfortable discussing their finances openly, and at the same time, often struggle to connect specific financial goals with the deeper values driving them. The CLEAR Framework can provide advisors with a structured approach to bring more depth to discovery conversations: kitc.es/4bOawp4 In this article, Senior Financial Planning Nerd Sydney Squires shares: -Client Barriers That Challenge The Discovery Meeting Process -Using The CLEAR Framework To Clarify Client Goals -How To Use The CLEAR Process Well -Following Up After The Discovery Meeting #advicers #discoverymeeting

Firms that prioritize 'client-centric' philosophies of technology use - viewing the most important role of technology as improving the quality of advice or clients' experience receiving it - report median revenue of around $500,000 per advisor, compared to $300,000 for those with an 'efficiency-centric' approach (whether focused on reducing costs or freeing up time). Beyond being more productive per advisor, those with client-centric philosophies are also much larger. Total practice revenue for these firms ranges from $1,000,000 to $1,200,000, compared to $400,000 to $600,000 for efficiency-centric firms.  Read more in our latest Kitces Research study on Advisor Technology: kitc.es/3BnX0tc #KitcesResearch #AdvisorTech

How a tech-forward, flat-fee model can expand access to planning, create a consistent client experience, and unlock new growth channels both through direct-to-consumer marketing and partnerships with other advisory firms.kitc.es/4bkOadx In this #FASuccess episode, Adam Dell, founder of Domain Money, shares how his firm built a financial planning software solution from the ground up to address the specific needs of his ideal clients, and how his firm uses AI to reduce administrative burden. #financialadvisorpodcast

"Avoiding Probate" is misleading as the marker of estate plan success. Because probate is so commonly framed as something to be avoided at all costs, its presence is often interpreted as evidence that the estate plan failed. That interpretation is misleading. A well-designed plan can still involve probate and be deemed a success. Alternatively, a plan that technically avoids probate may still be poorly implemented or difficult to administer. Advisors who help clients understand probate as a normal component of estate administration (rather than as a failure) can reduce this risk and provide greater clarity at a critical moment. kitc.es/4790pbK #advicers #estateplanning

What ACTUALLY Makes A Difference In Advisor Satisfaction? Senior advisors occupy a uniquely high-impact role within advisory firms and develop portable skills. For firm owners, the challenge is not merely recruiting this talent… but also creating an environment and incentives compelling enough to retain them: kitc.es/4dkgSh6 Senior advisor recruitment, training, and retention are all different sides of the same coin: workplace satisfaction. In this article, Senior Financial Planning Nerd Sydney Squires discusses the newest Kitces Research on What Actually Contributes To Advisor Wellbeing and how advisory firms can create work environments and compensation structures that increase advisor satisfaction and long-term retention. #advicers #advisorwellbeing

The downside of irrevocable trusts are that they are "irrevocable" and can't easily be undone ➡️ But here's how "swap powers" – the ability to exchange assets in an irrevocable trust with other assets of equivalent value – can be used to add flexibility and income tax efficiency to an irrevocable trust. kitc.es/3K6fHpa #advicers

How a "total portfolio approach" that groups investments by risk and performance characteristics (rather than asset class) could lead to a smoother ride for investors (@JasonKephart | @MorningstarInc) More curated articles on investment planning this #WeekendReading: kitc.es/4lCmipZ

The planning opportunities created by IRC Section 199A after the Tax Cuts and Jobs Act are tremendous. Here's how you can help clients reduce their tax burden through creative strategies around the QBI deduction.   Read more about the 3 buckets of QBI deduction strategies in the link: kitc.es/4rhLPpF

Missed Depreciation On A Rental? Why Amending Prior Returns Is Usually The Wrong Move: Missing a Required Minimum Distribution (RMD) can incur a hefty tax penalty of up to 25% of the missed amount – however, the IRS allows individuals to apply for a penalty waiver in cases where RMDs were missed due to reasonable error or circumstances such as cognitive decline kitc.es/3NiVTRk #WeekendReading

This #WeekendReading kicks off with the news that the latest @t3techhub/Inside Information Software Survey shows an uptick in advisor use of Artificial Intelligence (AI) tools, with approximately 52% of survey respondents using AI search and generative language functionality (up from 42% in the previous year's survey) and 43% of respondents reporting use of AI notetaking tools kitc.es/4lCmipZ

As a non-person entity, the T-CRUT is not subject to the 10-Year Rule and can be designated as the IRA beneficiary while naming the original non-spouse beneficiary as an income recipient of the trust and a charitable organization as the remainder beneficiary. This allows the account to grow on a tax-deferred basis, with income to beneficiaries being taxed when distributions are made. kitc.es/4nBbMyT #advicers

This isn't really an instance of "AI is replacing financial advisors", the reality is that Range was always building to be an AI-driven solution for DIY folks who weren't necessarily looking for a human advisor relationship. They needed humans to learn the processes and workflows to build for a consumer self-serve solution, and now it appears they're simply getting to the point that they're ready to be that software for DIY folks who want to self-manage with AI. The industry question will be whether Range can continue to support industry-similar revenue/client and client retention metrics with DIY-oriented software, as if their pricing has to come down and/or their client retention drops, they run a similar risk to robo-advisors a decade where, where lifetime client values dip below the very-high acquisition costs it takes to attract new clients in the first place... "RIA startup Range plans to eliminate its advisor workforce as AI takes over" kitc.es/4bepyEF

Tax Advice Restrictions For Financial Advisors⬇️⬇️ Despite the prominent role of taxes in financial planning, remaining in compliance while offering recommendations on a #taxstrategy can quickly become thorny. kitc.es/4ctJVyz #taxseason

Earlier this week, we made our latest Kitces Research study on Advisor Wellbeing publicly available on our website, and the response has been incredible! 🥳 kitc.es/4r4l0pN Our research efforts are entirely made possible by advisors like you participating in our surveys. We're currently surveying advisors for our forthcoming report on Advisor Marketing. If you work for a US-based advisory firm and find our research valuable, please consider participating in our survey. To express our gratitude for your participation, everyone who fully completes the survey will receive (expected in July 2026): A custom benchmarking report comparing your practice with those of your advisor peers who also completed the survey Exclusive early access to the final research report highlighting financial advisor marketing practices Take the survey here: kitc.es/4rjQdo1

This is a challenging spot, because if you don't outright specialize in clients with special needs children, most advisors may only come across these scenarios once or twice in a career, and won't necessarily have a good network of attorneys who can help create the special needs trust. So EncorEstate has rolled out a standalone offering for advisors to help clients get the important documents they need... "EncorEstate Plans Launches Standalone Special Needs Trust Offering for Financial Advisors at #T32026" kitc.es/4sKV6rD

This is, indirectly, how valuation multiples for RIAs are starting to come down slightly. Because the headline number of "such-and-such got a certain multiple of EBITDA" isn't the walk-away-with-cash valuation, it's the valuation including post-closing growth contingencies. In the past, that might have been 10%-20% of the deal consideration over 1-3 years. Now it could be 20%-30% of the deal consideration, and the window might extend out to 3-5 years. So you need more growth, for longer, and may have to stay and perform longer achieving it, to actually get that headline EBITDA multiple. Valuations are still very strong for advisory firms, but don't confuse an upfront-cash deal with one that requires years of post-growth earnouts to actually achieve... "Some RIA buyers hike earnout multiples in hot M&A market" kitc.es/4uf5oBE