FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
An ex-broker ran a Ponzi scheme, where he used victims’ money on mortgage payments and cigars (News10 ABC)
Fred Monroe, a former broker, was sentenced to up to 16 years behind bars after admitting to stealing more than $5 million from his investors, reports Anya Tucker.
Some of his victims, who are now at retirement age, spoke in court about how they lost their entire life savings. Monroe reportedly spent over $785,000 on credit card, mortgage and other bank payments; over $155,000 on groceries, gasoline, restaurants, alcohol, and cigars; and more on other personal expenses.
A new study by Allianz Life shows that 69% of baby boomers and Gen Xers don’t trust online financial advice, “which makes personal advice more important,” reports Karen Demasters.
Only 10% of both groups said they would be comfortable having their relationship with their financial advisor only online. Additionally, 46% of Gen Xers and 24% of baby boomers said they have “some interest in exploring robo-advisors,” reports Demasters.
“Perhaps the low interest rate regime actually has less to do with the Fed and more to do with basic economic principles. Economics 101 teaches us that when we don’t know if economic growth will be high or low — that the future is uncertain — we should save more. That savings glut drives interest rates to a lower level,” writes Wesley Grey.
Citing a recent research by University of Chicago finance professor Samuel Hartzmark, Grey writes: “while it is true that the Fed clearly wields some influence on rates, its ability to manipulate the rate away from where economic fundamentals suggest it should be is somewhat limited.”
5 important questions to ask yourself before moving to a new wirehouse firm (Wealth Management)
“You may think jumping from one wirehouse to another is like moving to the familiar house next door, with no hassles and little due diligence necessary,” writes Mindy Diamond. “But any move, including one where there are preconceived expectations and a lucrative transition package, should move the needle in a positive way for your business.”
As such, Diamond argues there are 5 important questions to ask:
- What is the benefit to my clients in making this move?
- How will the firm support my goals for growth?
- How will this move better support my team or help me create a succession plan?
- What is the reputation and perception of the firm — both locally and nationally — and is it the right cultural fit for you and your business?
- Is a move the right thing for me and my friends at this stage of our lives?
Merrill Lynch just launched a Social Security claiming tool (InvestmentNews)
Bank of America Merrill Lynch launched its own Social Security claiming tool. This comes years after independent software companies and financial services firms first started offering similar tools, reports Mary Beth Franklin.
“The way our advisers are looking at this is they are trying to make sure there is no shortfall even if their client lives into their 90s,” Ben Storey, the firm’s retirement product director, said.
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