by Carolyn Rothwell on February 14, 2017

Top Client Services: Retirement Income & Financial Planning


As we all know, there is much uncertainty surrounding the DOL fiduciary rule, which is due to take effect in less than two months. Regardless of if the DOL fiduciary rule is delayed, or a new rule is written to replace or even eliminate the current rule, the trend of advisors working to provide clients with more value, care, and transparency will continue.

A white paper by Nationwide and InvestmentNews Research explored how the DOL fiduciary rule might influence business models in the financial advice industry. When advisors were asked which services would provide clients the most value after the DOL fiduciary rule, retirement income planning and financial planning development garnered the top spots. The survey also asked which services would provide the most value to the firm after the DOL fiduciary rule and reported differences between the services value to the firm and value to the client.

Advisor Services Value to Client and Firm

At first glance, you will likely notice two things. First, the value differential between the firm and the client was the highest for investment management, with a 15.73% value for the firm over the value to the client. Second, the two most valuable services to the client, retirement income planning and financial plan development, had the largest negative differential between the value to the firm and value to the client, with a difference of -12.15% and -9.97% respectively. While the negative differential is eye catching, it's important to note financial planning and retirement income planning are the second and third most valuable services to the firm. 

Considering the time required to develop an initial financial plan compared to the amount charged, it is not a surprise planning services provide more direct value to the client than to the firm. However, even with a low-profit margin on planning services, clients who receive financial planning are reported to be more profitable to the firm.

Holistic financial planning continues to be an outstanding service advisors provide to clients. As more advisors move to offer financial planning services, creating well-crafted plans becomes essential for a firm's successFinancial plan development supports advisors working to provide the highest level of care and value to clients. 

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Carolyn Rothwell

Carolyn enjoys spending her time building Money Tree Software's brand and products. Her experience creating and delivering financial plans for a full-service financial planning firm and supporting advisors working to provide the best planning to their clients as a Money Tree support member has provided an excellent understanding of the importance financial planning.