Enjoy the current installment of “Weekend Reading For Financial Planners” – this week’s edition kicks off with the news that while a report by Microsoft finding that users of its Copilot Artificial Intelligence (AI) tool were able to successfully complete many tasks associated with financial advice (putting financial advisors in the upper tier of job functions that AI could potentially perform), a separate survey from Northwestern Mutual found that Americans continue to overwhelmingly trust human advisors over AI tools for tasks such as creating a retirement plan, suggesting that while many of the functions performed by a financial advisor could theoretically be done with the assistance of an AI tool, consumers are (at least so far) not convinced that relying on AI is a superior approach (though they did largely express support for their human advisors leveraging AI technology, suggesting that AI tools could be more of a force multiplier for advisors rather than a competitor).
Also in industry news this week:
- Morningstar’s latest “Mind The Gap” report finds that investors continue to frequently underperform in the total performance of the funds they invest in (due to market timing and other behaviors), suggesting a continued valuable role for advisors in helping them stay on track with their investments (even if clients don’t necessarily think they’re engaging in ‘bad’ behavior)
- A recent regulatory sanction indicates that merely introducing a communications archiving tool is not sufficient for firms to remain compliant with relevant regulations and that more active oversight is necessary
From there, we have several articles on insurance planning:
- Recent data indicate that property and casualty insurance premium increases continue to outpace the broader inflation rate, particularly for clients living in disaster-prone areas
- The value for clients of maintaining adequate disability insurance and potential pitfalls to monitor when evaluating different types of coverage
- A framework for helping clients determine the ‘right’ amount of insurance needed for their particular circumstances
We also have a number of articles on investment planning:
- Why recent momentum for adding private market investments to workers’ 401(k) options could create litigation concerns (and lead to E&O insurance hikes) for RIAs advising on business-owner clients’ 401(k) plans
- How the introduction of private market investments into target-date and other allocation funds could give clients exposure to these assets without actively choosing to do so
- Why some advisors and investors might choose to invest in asset managers sponsoring alternative asset funds rather than buying the funds themselves
We wrap up with three final articles, all about living abroad:
- Four ways for clients to retire abroad, from leveraging a “golden visa” to taking extended 90-day stays in multiple countries each year
- The ups and downs of life as a “digital nomad”, from the opportunities for adventure to the weight of handling the logistics of frequent moves
- Key issues for advisors working with cross-border clients, including the tax implications of moving to a particular country to the logistics of banking and fund transfers while abroad
Enjoy the ‘light’ reading!
