Your Complete Guide to XYPN16


There’s no shortage of things to look forward to at this year’s XY Planning Network National Conference, #XYPN16. And with so much going on, it’s easy to feel like you might be missing something.

That’s why we compiled this guide to walk you through all things conference content, parties, receptions, events, contests, and more!

Get the Basics

Here are some of our frequently asked questions and the improtant information you need to feel confident before arriving at #XYPN16.

Where is everything happening? We’ll be at the Sheraton San Diego Hotel & Marina. Most conference events will take place on site, whether inside or on the grounds. San Diego means lots of opportunity to use the outdoor space we have!

Do I need to arrange a shuttle from the airport to the hotel? You don’t need a shuttle, taxi, or Uber if you fly in. You can walk from the airport!

What should I wear? Whatever you want. This isn’t your typical, stuffy conference — and in fact, you may be more out of place if you wear a suit than you would be if you wore shorts and flip flops. Come as you are and dress the way that makes you comfortable and confident.

How should I meet up with people? If you’re part of one of our communities, either as an XYPN member or an XYPNRadio VIP, drop a line in the forums or the Facebook group. That’s a great way to coordinate meetups. But it’s not necessary — we have a lot of opportunities lined up to mix and mingle, network, and hang out with fellow attendees. (See below for what’s going on!)

What should I expect, in general? What’s the vibe like? Think more informal than formal, more casual than strictly professional. Everyone is friendly, approachable, and open — and most importantly, we’re here to help each other. Don’t hesitate to walk up to folks, start conversations, ask questions, and make new friends.

What if I need help at the conference? The entire XYPN Team will be on site and available to help you should you need anything. We’ll also be highly active on Twitter, so this is a great way to reach us if you can’t track a human in an XYPN tee down. Tweet @XYPlanning and use the hashtag #XYPN16.

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Know Which Sessions Are Right for You

#XYPN16 will feature 4 main content tracks. We’ve divided sessions and speakers into these categories so you can easily determine which presentations you’ll get the most value out of.

Hear from experts in each of the following tracks:

  • Practice Management: featuring panel discussions from industry leaders and top financial advisors
  • Continuing Education: get CE credit and the information you need to perform better as an advisor and RIA owner
  • Sales & Marketing: hear from the pros on how to gain visibility and generate more leads so your firm can scale and grow
  • Start My Firm: this is the content track for you if you’re looking to launch or are in the process of starting your own RIA

In addition to our content tracks, the conference features 5 keynote presentations:

  • Presentations from Alan Moore and Michael Kitces, co-founders of XY Planning Network
  • Keynote session from Heather Jarvis, student loan expert of
  • Keynote session from Pat Flynn, online entrepreneur, blogger, and podcaster from Smart Passive Income
  • Keynote presentation from Clark Howard on the importance of fee-only financial planning for consumers

To see all the sessions and speakers, head to the XYPN16 Agenda.

Check Out Breakouts, Roundtables, and More

Our expo hall will be rockin’ on Monday. Meet up with vendors and conference sponsors, grab some swag, and catch the tech demos that will happen throughout the day.

And our excellent vendors aren’t the only things to see and do in the expo hall on Monday. You can also enjoy a number of roundtable workshops, including:

  • Influencing, Not Selling, Millennials
  • Socially Responsible Investing
  • Writing Business and Operation Task Lists
  • Transitioning from the BD World to the Fee-Only World
  • Using Betterment in Your Practice
  • Divorce Planning
  • XYPN Radio VIP Roundtable Meetup
  • and more!

Plus, we’ll have a special area set up in the expo hall where you can meet up with other attendees and members of Team XYPN. Look for the XYPN Chill Zone (and note that this is where you can also get super early bird tickets on next’s year’s event — and sponsors can grab their space at a discount, too!)

Feel free to network with your fellow finanical advisors and conference attendees in the Chill Zone or just hang out and, you know, chill.

Don’t forget to make plans each morning to attend one of our group workout sessions, too! We’ll have members and attendees leading a Zumba class one morning and yoga the next.

Many of our attendees will also be bringing their families and small children with them. We’ll have a designated room set up for parents and children to go as needed for nursing and other needs throughout the day. (Please note the conference does not provide any adult supervision; parents should accompany children throughout the venue.)

Check out the full schedule to get the lineup of tech demos, roundtable workshops, and more.

Don’t Miss the Inaugural FinTech Competition

We’re hosting our inaugural FinTech Competition to find and showcase new players in the industry who are creating tech solutions to help financial advisors provide better financial planning to Gen X and Gen Y clients.

The competition will showcase 6 companies that offer software solutions and tech tools to financial advisors serving Gen X and Gen Y, in an effort to get them in a marketplace where they’re desperately needed.

Finalists were chosen for a combination of what we thought was relevant and useful tech for the advisor, and how differentiated the product was from existing solutions.

Get ready to see these finalists compete for the grand prize at #XYPN16:

These companies will be judged by Michael Kitces, Tom Kimberly of Betterment Institutional, and Ben Welch of TD Ameritrade Institutional. Bill Winterberg of FPPad will host the competition.

Party On with Your Favorite Financial Pros

We’re excited to host a number of parties, get-togethers, receptions and networking opportunities for our conference attendees this year. Here’s where we’ll be hanging out each day:

  • September 18, Sunday Night: Join us for our opening reception at 7pm on the Garden Terrace
  • September 18, Sunday Night: Keep the party going from 9pm to midnight in the Sunrise and Sunset Suites
  • September 19, Monday: Enjoy a food truck lunch, San Diego style, from 11:30am to 1pm
  • September 19, Monday Night: Participate in our pizza party in Habor Island Park starting at 6pm
  • September 19, Monday Night: Sunrise and Sunset Suites will be open again from 9pm to midnight
  • September 20, Tuesday Night: Don’t miss our closing party at Parq starting at 8pm. This will be a private event just for XYPN attendees. Join us in the Sunrise and Sunset Suites again until midnight, too
  • September 21, Wednesday Afternoon: Help us close out the conference and gear up for FinCon at the PB Ale House #XYPN16 Afterparty!

Play and Win at #XYPN16!

If all the events, parties, networking opportunities, and conference content isn’t exciting enough, maybe a chance to win a prize or two will help you perk up.

On Monday, you can be entered to win 1 of 3 iPads we’re giving away! All you need to do to earn your entry is visit each expo hall booth. Winners will be announced Monday afternoon.

You can also engage with us and join the fun on social media. Here’s a list of the contests we’ll run and how you can get involved:

#XYPN16 Superlatives: On Sunday before the conference starts, we’ll be checking Twitter to see who we can crown “Most Pumped Up for #XYPN16”! Prize: $50 Amazon Gift Card

Share your takeaway from Heather Jarvis’ pre-conference workshop on Twitter with the hashtag #XYPN16. Prize: $50 Amazon Gift Card

On Monday, tweet us your favorite photo with an exhibitor. We’ll choose the best (think: funniest, most creative) and our photo prize winner will score a new FitBit!

We also want to know what conference content you’re most excited about. On Monday, share the session you’re most excited to see and why. Use the hashtag #XYPN16. The winner will receive a free pass to XYPN17!

And finally, our big social media contest and grand prize… We’ll have a scavenger hunt on Monday. The first person to tweet us all of the following with the hashtag #XYPN16 will win a new GOPRO camera! Here’s what you need to find and send in:

  1. Photo with your favorite vendor in the expo hall
  2. Photo of you hangin’ in the XYPN Chill Zone
  3. Photo from a roundtable session
  4. Photo of someone in an XYPN tee (can be anyone, including yourself!)
  5. Photo of your favorite expo hall swag and who it’s from

The only rules for the above contests: you need to tweet all your entries to @XYPlanning and include the hashtag #XYPN16. That’s all you need to do to win!

Need Help or Have Questions? Here’s Where to Go

If you’re still looking for more information on #XYPN16, make sure to visit the main conference website at

Have specific questions? Make sure you visit our FAQ page to see if we’ve already answered them for you.

From there, you can check out the following resources and pages:

And of course, be sure to view who will be sponsoring #XYPN16. Our sponsors make the conference possible, and we wouldn’t be able to provide you with all of the above without them. Swing by their websites, social media, and of course their expo hall booths to say hello and check out what they have to offer attendees.

We can’t wait to see you in San Diego!

XYPN16 Sneak Preview: The Next Challenges For Advisory FinTech



FinTech is a difficult space in which to gain traction if you’re a small software provider. Large firms that negotiate enterprise contracts tend to be extremely demanding — and it often isn’t feasible for startups to reach larger firms in the first place.

Going to independent advisors can prove just as difficult. The market is extremely scattered and fragmented, and it’s hard to gain a foothold that’s sustainable and scalable.

Startups offering products for the side of the financial advice industry that operates independently and focuses more on comprehensive planning services instead of investment management as a primary driver of business often get stuck in the chicken-and-the-egg scenario.

You need visibility to get on with large firms or to successfully negotiate an enterprise contract that gives you the backing you need to grow. And you need backing to gain the visibility needed to earn the attention of those large firms.

Disrupting the Cycle

The FinTech Competition at XYPN16 will break that problematic cycle by providing a platform for FinTech software providers to gain visibility for their products.

We will bring startup tech companies to a large community of financial advisors who are likely to adopt those solutions. The immediate audience? XYPN16 conference-goers, a tech-savvy crowd hungry for solutions that address their problems and needs, and industry leaders and innovators who are excited to try out new FinTech that can improve their practice.

Finalists in the competition will also find their visibility getting a boost via valuable media coverage, both at the event and after through XY Planning Network’s various platforms and communities, including the Advisor Blog, XYPN Radio, social media channels, and Nerd’s Eye View from Michael Kitces.

Serving Gen X and Gen Y Clients

The overwhelming majority of technology for advisors right now is built entirely around the investment management value proposition. There are countless options for portfolio management, reporting, portals, and so on.

But there’s very little innovation around all of the other aspects of providing financial advice and delivering personal financial planning to clients. And advisors back up the investment management products with their wallets, finding it easier to pay more for portfolio-related software than any other tech tool.

One standout feature of XYPN16’s FinTech Competition is that it aims to support the growth of financial planning-centric solutions and tools for advisors, not just more investment related technology.

We support innovators who want to create more tools that allow advisors to bring better financial planning to Gen X and Gen Y on a monthly retainer business model.

The opportunity is here for both parties: advisors can reach more consumers with the monthly retainer model because it’s more affordable and accessible than a strictly AUM model. The caveat of the approach for the advisor is that they must run an extremely tech-efficient business.

For solo, independent advisors serving “small clients,” technology efficiency is crucial. And that’s where the opportunity for FinTech startups comes in: currently, there is very little software that’s made for independent advisors, particularly around helping advisors serving younger clients that don’t necessarily have assets but do have a diverse set of planning needs.

Better Tech Means Better Financial Planning

XY Planning Network is known as an industry disruptor. We want to continue making positive changes to our industry by making it easier and more feasible for advisors to serve young clients.

That gives more people access to the professional financial advice they deserve (before they amass wealth). It also creates more job opportunities for financial planners when you have a larger market of clients to serve.

We see FinTech innovation as an essential underpinning to expanding the market for financial planning in this space. Better tech makes advisors more efficient and empowers them to actually deliver a better value proposition to their clients through that efficiency and innovation.

The advisor does a better job, gives better advice, and provides a better client experience. At the end of the day, we all win.

Let’s Get Ready To Rumble!

XY Planning Network’s national conference, XYPN16, will play host to an exciting new event designed to generate more innovation in the technology space for financial advisors.

We’re hosting our inaugural FinTech Competition to find and showcase new players in the industry who are creating tech solutions to help financial advisors provide better financial planning to Gen X and Gen Y clients.

Traditionally, technology has only been provided by very large companies that focus more on investment management solutions. Some individual advisors innovated for themselves and created software solutions based on the problems they experienced in running RIAs.

They might have sold their software to a few peers and eventually ran a small software company on the side. But it’s hard for small players to gain visibility in the industry without investment from major companies — and it’s hard to generate investment without visibility.

XY Planning Network wants to help FinTech innovators overcome these and other challenges in order to bring truly unique, groundbreaking, and practical tools to the marketplace. The competition will showcase 6 companies that offer software solutions and tech tools to financial advisors serving Gen X and Gen Y, in an effort to get them in a marketplace where they’re desperately needed.

How the Inaugural FinTech Competition Found Its Finalists

18 companies met the competition criteria from all entries we received. Finalists were chosen for a combination of what we thought was relevant and useful tech for the advisor, and how differentiated the product was from existing solutions,

We tried to qualify a wide range of software solutions in the finalists — we didn’t just pick 6 financial planning software packages. Part of our goal in choosing finalists was to recognize new types and categories of software for advisors that aren’t being considered in the marketplace today.

That’s part of what makes this competition so exciting. It’s a showcase of new tools that work completely differently than anything else available.

So who are the six companies that will be competing on the FinTech stage at XYPN16?

Meet Our 6 FinTech Competition Finalists


Ambitient offers Team On-Demand, designed to simplify and consolidate various means of communication while offering additional functionality that streamlines the client interaction process. It is a single tool that combines and simplifies phone, video conference, text and email, while tying into an advisor’s real time calendar availability.

College Affordability

EFC PLUS from College Affordability is the first comprehensive college funding decision support system. Similar to the solution TurboTax provides for the IRS process, EFC PLUS generates the same customized answers for students and parents in the college funding and financial aid process.

Data Points

Predicting Wealth™ is a behavioral finance platform from Data Points that analyzes client behaviors that have been scientifically proven to impact wealth accumulation over time. The platform gives advisors powerful analytics to strategically help clients improve behaviors to build wealth, and provides clients with personalized, developmental reports.


RightCapital provides cutting edge financial planning solutions designed to enable financial advisors to efficiently and profitably produce customized financial plans. Their software includes specific functions like  budgeting, cash flow analysis, and debt management to help advisors serve next-generation clients.

Snappy Kraken

Snappy Kraken offers referral automation software. They provide advisors with a single source for customizing, deploying, managing and tracking key business processes and referral generation campaigns.

Totum Wealth

Totum helps human financial advisors bring risk clarity to their wealth management practice, delivering fully-customized portfolios via an interactive visual interface. They company is democratizing tools previously available to only the largest institutional investors.

Join Us at XYPN16 for the FinTech Competition!

The FinTech Competition will be hosted at XYPN16 by financial advisor tech guru, Bill Winterberg. Bill is the creator and host of FPPad, and is an undisputed leading source of news, insight, and thought leadership on financial planning technology.

Our competition sponsors will also be in attendance, and we want to give a special thank you and recognition to both Betterment Institutional and TD Ameritrade Institutional for supporting this event. We’re grateful companies like these are as invested as we are in the future of tech innovation in our industry.

You can attend this event yourself when you purchase a pass to XYPN16. The conference takes place from September 18 to 21 in San Diego, California. To learn more and to purchase your pass for just $399, head to


How to Run an RIA and Work as a Virtual Advisor

Run an RIA Virtual Advisor

The following is an excerpt from XY Planning Network’s ebook, The Virtual Advisor. Want your own copy? Download it for free here!

Ask yourself this question: what does your ideal life look like? There’s no wrong answer. It’s about what’s important to you. Your answer should reflect what you value.

But no matter what your answer is, it’s likely that you need a good deal of flexibility and freedom to live that life of your dreams. And that’s what the case for working virtually – even as a financial advisor – is all about. Working virtually allows you to build a business that supports your great life.

Why a Virtual Business Provides Access to Your Great Life

Traditional business models require us to build a life around our business. When you work full-time from a physical location and meet every single person you do business with in person, you lock yourself into a very set schedule and routine. There’s little room for freedom and flexibility (even though you’re an entrepreneur and you call the shots).

You must be in an office all day. You can only work with clients in your area. You can’t travel freely for extended periods of time. You don’t have the ability to move effortlessly. Changing locations means uprooting your entire business.

This probably doesn’t support your great life.

With new technology and an evolving acceptance of digital methods of communication and working together, virtual work opens many doors for you. You now have the opportunity to engage in the pieces of life that leave you satisfied, happy, and fulfilled, all while running a successful business.

What is it that you want to do on a day to day basis? It could be the ability to travel whenever and wherever. Maybe it’s maximizing the time you spend with your children and your family, and being there for all their milestone moments. Perhaps you want to volunteer and help others near and far.

Define what you want your life to look like. And then understand that whatever your answer looks like, your business can — and should — support that.

Working with Your Ideal Client

As a financial advisor who understands the importance of putting your clients’ needs and interests ahead of your own, this opening argument for working virtually may sound a little self-serving. But there’s no reason you can’t live your great life with a flexible business that allows you great personal freedom – while also better serving the clients your business is designed to help.

Think about this. When you only work in person, you limit yourself to a local area, neighborhood, community, town, or city. You can only serve people in your immediate location. People will only drive so far to come see you.

Working virtually opens you up to working with anyone, anywhere. There are no more barriers created by the fact that you and your ideal client just happen to live a few hours (or many hours) away from each other. That provides a lot of freedom not only for you, but for your clients, too.

Being a virtual advisor means your clients can be anywhere in the world, too. They’re no longer limited to working with someone based solely on the fact that the two parties are present in the same town. Your clients get to choose the absolute best financial planner for them, based on what that professional can provide, and not based on where everyone happens to be on a map.

Or your clients can still live in the same town as you do. They can still live within an hour or so of your office. And these are still clients you can work virtually with, because it provides them with a more convenient option.

When you force clients to meet in person 100% of the time – especially if you specialize in younger clients – you’re asking them to make a big time commitment. They have to take off work. They may need to get (and pay for) a babysitter. Then they need to actually get to your office, and deal with traffic and parking.

A one hour meeting becomes a three hour ordeal for those who work, have families, or need to attend to other other responsibilities. Hosting virtual meetings can save time and stress, and can provide a better client experience.

Your practice should be designed to care for your ideal client, no matter what. So, no, virtual advisors are not self-serving and virtual planning is not solely for the benefit of the provider. This is a win-win situation for everyone in the highly digital, mobile, technology-focused, forward-thinking world we all live in today.

Learn more about the technology you need and the compliance questions you have around running a virtual RIA with your free copy of The Virtual Advisor.


Narrowing Your Niche and Why It’s a Good Thing

Let’s talk for a moment about a phrase used above: your ideal client. You do need to understand who this person is, and the specific set of characteristics that make them who they are – and that make them ideal for your business.

It’s important to target your audience and focus on a specific segment because you can’t be all things to all people.

When you clearly define your niche market, you can be the go-to expert for that segment. By becoming the expert in a niche market, you become the most knowledgeable professional in that area – and that makes you highly referable to new clients. Narrowing your niche makes it easier to define what you do and who you do it for.

Reaching Gen X and Gen Y as a Virtual Advisor

The ultimate case for working virtually may lie with the fact that younger generations are comfortable with technology and find it accessible, sensible, and convenient in their everyday lives.

Gen Y is defined as individuals with birth years ranging from the early 1980s to the early 2000s. This is the largest generation in US history; consisting of 93 million Americans, Generation Y eclipses the the Baby Boomers by about 20 million people.

If you add in Gen X (or those aged between 34 and 50), which have adopted technology en masse as well — you’re looking at nearly 50% of the US population. And these groups are not only comfortable with the kind of technology that allows for virtual planning — they demand it.

According to the global information and measurement firm The Nielsen Company, “when asked what makes their generation unique, Millennials ranked ‘Technology Use’ first.”

“Given their fluency and comfort with technology, Millennials have more of a positive view of how technology is affecting their lives than any other generation. More than 74 percent feel that new technology makes their lives easier, and 54 percent feel new technology helps them be closer to their friends and family.”

If you want to reach one of the largest generations in history, a group eventually expected to hold $30 trillion in assets, it’s important that you maintain an open mind when it comes to technology — and working virtually.

How Financial Advisors Can Secure Client Information via Email

Client Information

As new technologies emerge and our industry continues to evolve, keeping information safe and secure becomes more and more important. It’s critical to understand cyber security from a basic protection standpoint. But financial advisors should also know what they need to do to stay compliant, too.

Recently, state regulators increased focus on privacy laws. Specifically, they looked at the use, storage, transmission, and handling of client information.

The Compliance Updates Financial Advisors Need to Know

The SEC issued Regulation S-P, and the CTFB (Consumer Financial Protection Bureau) adopted Regulation P. Both of these regulations address the responsibility to provide initial privacy notices to your clients. These notices should outline the handling of their nonpublic, personal information.

And if you’re state-registered, you probably need to create these notices for your clients, too. Most states have some version of a privacy requirement that mirrors the regulations above.

In an increasingly technology-based world, you shouldn’t anticipate any regulatory pull-back on this topic anytime soon. It’s advisable that all firms have an effective cybersecurity program that includes the necessary evaluations and testing of all technology used in the firm’s course of operations.

Much of the rationale behind this need is the compliance surrounding the protection of client information. Not only is there regulatory risk, but reputational risk is substantial. The feeling of personal violation associated with having one’s’ privacy compromised can be damaging to client relationships.

Some of the most common pieces of client information that fall under the category of nonpublic and personal include your clients’:

  • Social Security Number
  • Driver’s license or passport number
  • State identification number
  • Debit or credit card number
  • Account number

And some of the most common ways we fail to secure that information? Accidentally sending client information via email.

How to Protect Client Information via Email

We have all been there. You draft an email, press send, and then immediately notice a mistake. Some email service providers have “recall” feature that allow for an attempt to recall the message, but once you click “send” it’s usually too late to turn back.

If the error you made includes sharing any of the above listed pieces of client information, then you probably violated Regulatory Privacy Requirements… unless you took the necessary steps to encrypt the email before sending it.

Use Email Encryption

There are numerous vendors available that offer services that assist you in encrypting your emails. But if you prefer not to pay for an additional service, there are other alternatives.

One option is to add passwords to your PDF documents when you save them. You can either call the recipient of the document to give them the password over the phone, or let them know in the email that the password is something recognizable to them (i.e. “The password is the last 4 digits of your Social Security Number”).

Obviously, it defeats the purpose to send the password in the same email.

Another viable option is to manually strike out certain items on the personal information. For example, if you send an email in reference to account number 1234-5678, then most regulators would accept a message sent as xxxx-5678 as compliant.

Download our free guide on 25 tools under $25/month to help you better run your business.

Don’t Fall into the Email Thread Trap

It is easier to remember to encrypt personal data on an email that you draft from scratch. But when you respond to client emails in such a manner that it creates a long email chain, you risk falling into a compliance trap.

That’s because the longer the email chain, the harder it is to make sure that you aren’t disseminating personal information. Remember, even if the client sends the personal information to you via email, if you respond without encrypting it, it can be seen as a violation for your firm.

Track Your Communications

One way to satisfy regulators in the area of securing client information is to maintain a log of each and every violation of client privacy that occurs within your firm. Make sure that your firm has proper supervision and archiving of email communications, and pull a sample of emails every once in awhile to make sure you don’t spot any violations.

Document the review by date and time and if you have the resources, create a separate mailbox only for forwarding the emails that you have reviewed. Your log can be an Excel spreadsheet that documents the date, the time, any violations, who created the violation, and what corrective action was taken.

Accidentally failing to protect client information via emails is a common occurrence. It happens! But with preparation, awareness, and proactiveness, firms can decrease the number of client privacy violations that are committed via email.


Scott GillAbout the Author: Scott Gill is the Director of Keeping Us Compliant here at XY Planning Network. Outside of the office, Scott enjoys watching sports, exercising, and operating the charitable organization he created upon his father’s passing. You can connect with him on LinkedIn.

11 Myths to Stop Believing about Fee-Only Financial Planners

Fee-only Financial Planners

The XY Planning Network has a few requirements for membership, and one of the leading qualifications is that you must be a fee-only financial planner. And as easy as it seems to determine if someone is fee-only, it’s actually a fairly complicated process.

At the Network, we adopted the CFP Board’s definition of “fee-only.” While we don’t necessarily agree with every facet of it — as co-founder Michael Kitces wrote about in the past — we didn’t want to create a second definition of fee-only and further muddy the waters on what the term really means.

Where Does Fee-Only Come From?

Ever wonder where the term came from in the first place? The CFP Board simply stated their version of what constituted fee-only, and the industry moved forward with what the Board stated.. There wasn’t a precise definition.

But NAPFA — the National Association of Personal Financial Advisors and the home of fee-only advisors — already had their own definition of what it meant to be a fee-only financial planner. When the CFP Board rolled out new rules a few years ago with a definition that was different from NAPFA’s, it created this two definition of fee-only issue.

When we launched the XY Planning Network, we chose to use the CFP Board’s definition for clarity with consumers as well as advisors. And today, whenever we talk to advisors interested in joining XYPN, we get a lot of questions around being fee-only.

Busting the Myths Around the Fee-Only Designation

There are a lot of myths surrounding the definition of fee-only financial planners, what constitutes fee-only, and what would violate the definition of fee-only. Unfortunately, we see many people in the industry trying to use that confusion to their advantage and to find a workaround to the qualifications of what makes an advisor fee-only.

The following is a list of 11 questions or statements we often hear when we talk to people about what makes a fee-only financial planner. We’re busting the myths and shedding light on what you can and cannot do in order to uphold this designation within the industry.

1. I Can Be a Part of My B/D’s RIA, But Still Be Fee-Only

Many people claim this is according to the CFP Board — but this is a myth. In order to be fee-only, you and all related parties including the firm that you work for must be fee-only. That means is that no commissions can ever be earned.

If you’re attached to a broker/dealer, that company is able to earn commissions. You cannot call yourself fee-only because of that relationship. This is the case whether your RIA is fee-only or not.

2. I Can Be Part of a Hybrid Firm So Long as I Personally Am Fee-Only

According to the definition, you violate the definition of fee-only if you or any related party can earn commissions. What this means is that the definition of fee-only is actually at the firm level and not at an individual advisor level.

There are many financial advisors who work inside of RIAs that also employ others selling insurance. Everything the advisor does is on a fee-only basis, but this does not qualify for the definition of fee-only.

Again, according to the definition, everyone at the firm must be fee-only. Even if you worked at a firm with 100 advisors and there’s one selling insurance, no one at that firm can call themselves fee-only.

Learn how XY Planning Network can support you in starting your own firm. Click here to save your seat on our next webinar.

3. I Can Be Fee-Only and Still Sell Insurance

This one is pretty obvious, but it’s worth saying: this is a myth! This is something that we hear pretty often: “I’ll continue working in my client’s best interest and simply sell them insurance. So I should be able to call myself fee-only.”

The terms fiduciary and fee-only are not the same. You can absolutely do what is in your client’s best interest and be a fiduciary to that client while still selling them insurance. But that doesn’t mean you can call yourself fee-only.

By definition being fee-only means you can’t be earning commissions — and you can’t be in a position where you could earn commissions.

4. I Can’t Advise on Insurance If I’m Fee-Only

Not true! You can absolutely advise clients on what types of products they should purchase, how much they should purchase, what companies they should purchase their insurance products from, and remain fee-only.

Fee-only means that you do not earn a commission on the sale of a financial product, but you can give advice on what your client should pursue. There’s an obvious, inherent conflict of interest when you both give advice and sell a product. The commissions earned from the sale of a product may taint your advice whether you intentionally do it or not.

Fee-only financial planners separate giving advice from selling a product. You may only receive payment for giving advice, and that eliminates a large conflict that advisors who aren’t fee-only will always face.

5. I Can’t Join XYPN Due to Existing Trails

We do allow for members to join the XY Planning Network that still have trails. You simply need to get rid of those trailing commissions within the first 12 months of being a member.

Until you’re officially fee-only, you cannot be listed on our Find an Advisor profile and you can’t hold yourself out as a member of the XY Planning Network. You’re also not allowed to sell new products once you join the organization.

But there is a transition period, because we recognize that when you leave a broker/dealer, break away from another firm, or run an existing firm that is not fee-only today, you can’t just cut everything off overnight.

6. I Can’t Keep My Insurance License and Remain Fee-Only

This is a myth. Many states actually require that you have an insurance license in order to be able to advise on insurance at all. Consult with your state regulators to determine if you’re in one of these states that requires licenses in order to provide advice related to insurance.

You absolutely can keep your insurance licenses and remain fee-only. What you cannot do is associate with an insurance company that gives you the opportunity to sell insurance products for commission.

7. I Can Get Affiliate Revenue from My Blog and Stay Fee-Only

With the rise of financial bloggers turning into financial planners and financial planners starting blogs, we’ve created a gray area in compensation. Many bloggers get paid through affiliate links on their website. They may write a review of Personal Capital and if a reader clicks an affiliate link and signs up for an account (or takes some predetermined action), the blogger receives a kickback from Personal Capital.

These affiliate links can earn hundreds, even thousands of dollars per reader who clicks and takes action on the other company’s website. Bloggers also develop relationships with each other to provide affiliate sales for one another’s products.

Any of these relationships, in our view, violate the definition of fee-only. You cannot financially benefit from the advice that you give. So when in doubt, ask yourself, “could this taint my advice? Could getting paid to recommend Personal Capital over LearnVest taint my advice when it comes to which one I’m recommending?”

The answer is always “yes.” It’s not about does it influence your advice, but could it influence your advice. And if it could, then you need to forgo it.

Ultimately you make a referral to whichever company you think is best. If you get paid to recommend any product, service, or company, you violate the definition of fee-only.

8. I Can Be Fee-Only Even If I Have Less Than 2% Ownership in a Commission-Generating Firm

We’re seeing this question less and less, but some lingering confusion comes from NAPFA’s old definition of fee-only. To get specific, many fee-only financial planners used trust companies to do some of their investment management. In the past, trust companies required a firm actually have partial ownership in the trust company in order to utilize it.

And so they may have one share or they may literally own one-half of a percent of a trust company in order to gain access to using that company. But because the trust company was allowed to sell commission products, NAPFA’s definition of fee-only essentially said that if you own less than 2% of this company, we understand what you’re doing and we’re not going to say that that violates fee-only.

It made sense at the time. But since then NAPFA has changed their definition and the CFP Board’s definition certainly does not allow for this. This is an old-school idea that no longer applies. Today, you cannot maintain ownership — whether ia fractional share or any percentage whatsoever — in any company that can generate commissions.

9. I Can Own Both a Financial Planning Firm and an Insurance Company

Nope. This is a common workaround attempt where an advisor might say, “how about I just own a financial planning firm and I own a separate insurance company, and I’ll do all of my planning on a fee-only basis and then I’ll sell insurance to whomever.”

This violates the definition of fee-only because you would have ownership in a company that sells insurance. Now you may ask, “could I simply sign contracts that prohibit any financial planning clients from getting insurance?”

You can absolutely do that, but it doesn’t make you fee-only. Owning both is simply not permissible while trying to be fee-only.

In addition to this, another common question we here goes something the lines of, “can I own a financial planning firm and my business partner own an insurance company and we work together somehow?” The answer is no.

You can have no ownership, nor can you sign contracts that guarantee for all of your financial planning clients to go with a particular insurance company and vice versa, because now you are incentivized to refer all of that business to to a single insurance company.

10. I Can Own Both a Financial Planning Firm and an Insurance Company — as Long as I Don’t Refer Business Between the Two

Nice try, but no. If you own both, you simply cannot call yourself fee-only in any way.

11. My Clients Want a One-Stop Shop for All Their Financial Needs. I Can’t Provide That as a Fee-Only Financial Planner

We understand the desire to want to give your clients a one-stop shop at your firm for all of their needs — and this includes insurance. You do comprehensive financial planning. You do investment management. You want to provide them with the insurance they need, too.

But there’s a logical fallacy here. Why are you only focusing on wanting to sell insurance and not being able to as a fee-only advisor?

Are you also writing all of your clients’ estate documents? Are you doing all of their tax planning? Are you helping them get a mortgage? The answer is probably no.

Very, very few firms do all of that inside a single firm. Most firms refer clients out to experts. With insurance, you can do all the comprehensive financial planning and give your clients the advice that they need — and then be able to refer them to experts on insurance whenever you need to.

And this strategy actually benefits you. One, by outsourcing it to an outside company, you don’t actually have to handle all of the paperwork, the medical underwriting, getting all of the forms filled out, and everything else that comes with getting the insurance policy which is an incredibly detailed time-consuming task (and honestly, probably not a good use of your time).

Two, you can refer them to an expert. You can refer them to someone that does this everyday, all year. If you’re only writing a few term life insurance policies a year, you can’t possibly stay up on all of the changes that are happening with all of the different companies, with all the different types of policies out there.

It is likely better for the client to refer them to an expert who can get them the best policy for them. So while you’re the expert in what they need, the insurance company is actually the expert in actually getting it for them.

If you’re not sure who to refer clients to, start by checking out companies like Low-Load Insurance Services (LLIS is also a national sponsor of XYPN).

While we can’t answer every question regarding the definition of fee-only, but busting these 11 common myths should help give you a better understanding of what it means to uphold the requirements and standards. If you have further questions around what constitutes — or what violates — the definition of fee-only, please reach out to CFP Board for clarification.


Creating a Cybersecurity Plan for Your Financial Planning Firm

Cybersecurity Plan for Your Financial Planning Firm

It is clearly a challenge in the modern era of business to make serious technology decisions. We now see a pace of change that disrupts technology planning on nearly a quarterly basis, less accommodating than the year over year hardware and software updates and releases we have grown accustomed to.

Paired with this breakneck speed of technology is the comprehensive move to the use of Internet-connected applications — both in the web browser and on smartphones and tablets.

This shift to the web began over a decade ago. And since the emergence of the iPhone in 2007 and iPad in 2010, the acceleration of our business tools becoming a part of the “Internet of Things” has been stunning.

This combination creates complexity for financial planning firm owners and puts pressure on all advisors tasked with protecting data and information for an RIA to make smart technology decisions. You must balance efficiency, risk and profitability.

But cybersecurity is not a new topic. In fact, it has been a part of our conversation on risk since the first systems connected to the Internet. It is just exacerbated now in our digital, always-connected way of doing business.

What to Consider in Your Approach to Cybersecurity

Data security is as much about behavior as it is software and hardware. Train your team in good security practices.

Talk through how you each work, both in office and when mobile. Think through these scenarios when you develop your security practices and policies for employees to read and affirm.

Staying Safe When Connected to the Internet

It is quite rare when anyone works offline. Be certain that all laptops are using personal VPNs for using WiFi on public networks, password managers to ensure strong passwords and reinforcing the need to always be protective of handling and protecting customer information and other vital data. Two-factor (multi-factor) authentication should be used on all accounts where it is available.

All computers, and especially laptops, should be disk encrypted. This is now available at no additional cost on Mac OS X and Windows computers (you can use File Vault and Bit Locker, respectively). In addition, setting a timeout on those computers to re-encrypt when they go into sleep mode (best practice is 1 minute of inactivity).

For manual locking, remind users to lock their computers when walking away from them in any setting (especially in public places – it can be done with a keyboard stroke on both Macs and PCs).

Ensure that antivirus software is set to update and run automatically. Always set computers to auto-update for operating system patches.

Provide firewall security for all Internet connections. These are best used both at the connection level (a router bringing the Internet into your office) and also the individual firewall software included on computers. This includes home and other remote offices.

Your policies should require these to be confirmed and tested at least quarterly.

Dealing with Mobile Security Concerns

Have a strategy and plan for managing mobile devices. Confidential data can leak onto smartphones and tablets. They should be protected with a password or pin to unlock, and set to erase automatically if an incorrect password or pin is entered more than 5 times.

Additionally, a security app should be on each device that protects against malware and viruses. Personal VPNs should be used on these devices as well to secure all WiFi connections. The password managers selected for your computer browser(s) will also extend to your smartphones and tablets.

Finally, where possible, the backup and/or sync process for backing up these devices should be password protected and/or encrypted.

Backups Are an Essential Part of Sound Cybersecurity

Backing up business data is essential. We subscribe to the 3-2-1 backup approach. This means always having three copies of your critical business data, from email to working documents and other data from systems and applications.

Restoring from backup should be tested at a minimum annually. Ideally, you can use this approach:

  • The original copy of data are your working files, actively on your computer and/or mobile devices.
  • The second copy is your daily backup, which can be local or cloud-based. If local, the data storage should be rotated to be stored in fire and water proof storage.
  • The third copy is what we call the disaster recovery backup. It should be backed up on a completely different system and stored in a geographically disparate area. In essence, one should be able to acquire all new equipment and devices and restore all business operations from this third backup regardless of location.

Insurance Doesn’t Solve the Whole Problem — But Does Matter

You will need to maintain insurance to address cyber security incidents and/or network and data breaches are becoming more commonplace as a foundation to any security strategy. Explore the capabilities for carrying insurance that can assist with notifications, litigation and credit insurance from your existing general and professional liability carrier(s).

This insurance goes along with the steps we have outlined, not as an alternative or replacement.

Today’s technology grows and changes at exponential rates. As you incorporate more technology into the running of your firm, it’s important that you stay educated on best practices for cybersecurity. Keep asking questions, doing your research, and maintaining your awareness of the importance of protecting your — and your clients’


ABlane-Social-Profile-Photo-257x300bout the Author: Recognized as an industry leader in financial services marketing, compliance and technology, Blane Warrene has worked in progressive roles for broker dealers, investment advisors and asset managers. He co-founded Arkovi Social Media Archiving in 2009 with Carl Cline and TysonLowery, and sold it to RegEd in October 2012 RegEd. He also co-founded QuonWarrene with Neal Quon, where he serves as a board member today.

Blane additionally serves on the board of the Dennison Railroad Depot Museum, a national historic landmark in Ohio. You can connect with him on LinkedIn, or on Twitter.


Advisor Book Review: So You Want to Be a Financial Planner

Want to be a financial planner

For far too long, there hasn’t been much direction or advice for next generation talent interested in pursuing a financial planning career. There aren’t widely-available answers to the tough questions about how to start or get your foot in the door as an advisor who really cares about financial planning for their clients.

Resources are scarce and it’s not always easy to find a mentor to help understand how to break into the profession and succeed in the industry. But there is good news, and it comes in the form of a comprehensive read for anyone looking to get into financial planning

So You Want to Be a Financial Planner aims to fill the resource gap by covering just about every angle of the topic that anyone looking to enter this industry will want to get familiar with. This book is a full guide for anyone considering a career change, looking to transition to financial planning from another position within the financial industry, or currently pursuing higher education in financial planning.

Simply put, it gives future financial planners the start they need to succeed in the field.

Pair this book with our free business plan template. Click here to download your copy.

Must-Know Info Straight from the Source

One of the great things about So You Want to Be a Financial Planner is that it was written by someone who knows the ins and outs of the business — and whose aim in writing the book was not to market herself or her firm, but truly to provide much-needed insight for newcomers.

Nancy Langdon Jones, CFP® is heavily involved in the industry and focuses on educating professionals both through her books and through teaching courses leading to the CFP® certification exam. She’s also served on the CFP® Board Item Writing Committee and is a member of NASAA’s Investment Advisor Competency Exam Advisor Council.

The book itself provides information that’s hard to find elsewhere, and readers who are new to financial planning can trust that it’s a reliable resource to help them get started.

What’s Covered, and What You’ll Learn

The book builds on a natural progression of what it means to be a financial planner and takes readers on a step-by-step journey of what starting their own practice would look like. Beginning with establishing the educational framework, Jones explains the process of obtaining the Certified Financial Planner™ designation, and provides case studies from advisors that have attended some of the top CFP® programs across the country.

The material continues with chapters on compliance, starting a practice from scratch, and even a chapter on maintaining passions and hobbies outside of the industry while working toward growing your financial planning career. Readers will find immense value in the balance of actionable advice and psychological perspective provided throughout.

Going Beyond Theory and Hypotheticals

The opening chapter begins with arguably the most important question for someone looking to establish a career within the financial planning industry: the question of why.

Jones is transparent in her reason for choosing a career in financial planning and shares several interactions with actual clients that only reinforced her decision (and this level of transparency is a theme throughout the book). Jones shares not only her experience, but also the stories of other financial planners who detail their successes and failures along their career paths.

The insight and stories are very helpful for driving some of the points home, and reading stories of individuals who have had the real-life experience is far more helpful than simply reading hypothetical explanations of what could happen.

A Springboard for Additional Resources

The sheer amount of resources included feels impressive and is an added benefit to readers. Not only do you receive the information, but you also get a list of other places that might fill in any gaps.

For example, if you were considering the financial planning industry and had questions about what to expect on the Series 65 exam, there are actual sample questions in the book. Or maybe you’re a little further along and need an action plan for establishing the compliance and regulatory side of your planning practice. There is a step-by-step process for that as well.

Simply put, whether you are new to the industry or an established practitioner, you can rest assured that So You Want to Be a Financial Planner provides a number of resources to help level-up your practice.

Addressing the Gaps

If there’s any opportunity for improvement within the book, it would be a more in-depth look at how to market yourself as a financial planner and your financial planning firm. To be fair, Jones does open the chapter by stating that the marketing information will be relatively short because 1) she admittedly doesn’t know a lot about marketing and 2) there are entire libraries and degree programs on the subject.

While those points may be valid, the information included in the subsequent chapter feels slightly stale and outdated.

With an increasing reliance of many advisors on technology, the methods of advertising by creating and distributing flyers or placing ads in newspapers simply won’t work with more tech-savvy consumers and next generation clients.

A basic overview of some of the new marketing best practices available would be helpful, and would continue one of the book’s strong suits: providing a strong starting point and foundation from which to continue to build knowledge.

What’s Next if You Want to Be a Financial Planner?

So You Want to Be a Financial Planner places a heavy emphasis on networks in general, and networking with other colleagues in the industry. For someone looking to break into the financial planning as a career, these are invaluable resources to consider after you’re done reading.

In many of the case studies, the financial advisors profiled credit much of their success to the networking opportunities they have been afforded and the organizations that they are a part of, including:

A Must-Read for Newcomers to Financial Planning

With So You Want to Be a Financial Planner, Jones covers just about every angle of the topic that anyone looking to enter this industry will want to get familiar with. She provides answers, ideas, and solutions for people eager to start down this career track, and gives countless resources to follow up on when you’re ready to ask more advanced questions and dive deep into complicated topics like starting your own firm.

This is a must-read for anyone considering a career change, looking to transition to financial planning from another position within the financial industry, or currently pursuing higher education in financial planning. This comprehensive guide gives future financial planners the excellent start they need to succeed.


Compliant Document Storage for RIAs: What You Need to Know

Compliant Document Storage for RIAs

Compliant cloud document storage, or storage of data in general, is a hot topic right now. There’s not a lot of guidance being provided by the SEC or state regulators in regards to actual, concrete rules around what advisors need to do in order to ensure their documents are stored in a compliant manner.

The best that we have right now? FINRA has released some rules around the idea that they prefer documents be stored behind a 256-bit encryption format. But this was created by FINRA, and it’s not a hard and fast rule — so it doesn’t necessarily apply to SEC- or state-registered firms, and at this point it’s unclear how it might apply.

There are a few things you can be doing to ensure that, as a financial advisor, you’re being smart with your data. We want to be compliant and we also want to be sure we’re not hacked and client-sensitive data is being stolen out of our systems. You never want to be the one to make a phone call to a client to tell them their identity was stolen thanks to a hack at your office.

Creating a Secure System for Your Compliant Document Storage

There are three layers of security that we need to consider. The first is how documents are actually stored on your computer and other devices. This also applies to servers, but most tech-savvy financial advisors use the cloud for storage. We discuss why cloud storage makes more sense in our free ebook, The Virtual Advisor.

The second layer is the transmission of data, which refers to the process of moving information from local storage to the cloud or moving files back and forth between you and your clients. The third is the actual cloud storage solution.

So how do you protect all these levels?

Secure Your Devices

The first step to take is to secure all your devices. Whenever you’re logging into your computer systems, you always want to have a very secure password on your computer.

You want to be sure other people can’t pick up your laptop and easily access information and documents on it — which means making sure anytime your computer times out or goes into sleep mode, it requires a password when you return to actively using it (rather than just requiring a password when it’s booted up from being shut down).

Use Encryption Software

Next, use encrption software on your computer so that if someone does hack the initial layer — the documents actually being stored on your devices — that they’re not able to fully access your hard drive.

For PC users, you can check out BitLocker Drive Encryption to do this. If you use any devices running iOS, you can use OS X. Alternatively, Symantec offers a solution that works for both Windows and Apple operating systems.

Don’t forget about mobile devices, too. Many of us link Google Drive, Dropbox, and of course our emails to our phones, so they need to be secured like your computer. Make sure you set up a PIN to protect your information — but also note that this can be hacked through brute force.

To protect against this, you need the ability to remotely wipe data from your phone. For both Android and iOS, you can use Lookout. (If you’re an Apple user, you can also set up Find My Phone.)

Secure the Transmission of Data

This is an area where many financial advisors can get into trouble. In order to secure transmission of data, you need to start by using a secure Internet connection. The Internet you use at your home or office is most likely just fine — the issue usually comes when you’re on a public, unsecured WiFi network.

Many folks will go and sit at the local coffee shop and upload documents to the cloud or handle email. It seems harmless, but the problem is that these networks are extremely easy to hack. Essentially, a middle schooler could hack the network and gain access to your data.

There are a lot of “spoofing” opportunities here, which means someone could set up a wireless network called, for example, “Starbucks3” and make it look legitimate. If you’re not signing onto the real network Starbucks is providing for free and sign onto a fake network instead, a hacker can literally scrape any data you transmit over that wireless connection.

To secure the transmission of your data, you should avoid unsecured public networks. You can use a jetpack or mobile hotspot instead to avoid these issues. All of the major cellular carries offer these, and they turn 3G and 4G mobile data into a WiFi network that your computer can connect to. Many smartphones come with the capability to create mobile hotspots.

You can also get PrivateWiFi, which allows you to set up your own virtual private network (or VPN. You can then connect to the Internet remotely with a secure connection.

Another issue to be aware of when using your computer and connecting to the Internet: your choice in browser. Use a browser such as Google Chrome, which comes with a lot of built-in secure features to ensure the encrypted transmission of data.

And anytime you’re sending sensitive information online, you want to check that the web address says “https.” Http is the standard, and the extra s indicates the URL is secure.

Secure Your Documents Once They’re in the Cloud

This is the area where many advisors — and compliance experts — are concerned, because there are different levels of encryption that each individual system uses. For example, Google Drive stores data with a 128-bit encryption, which is significantly better than the previous standard of 56-bit. However, it’s not as secure as 256-bit, which is what FINRA has recommended as the new standard.

With this information, you have a couple of options. If you use Google Drive or Dropbox and prefer to continue using these programs, you can sign up for a separate program called Boxcryptor. It’s very inexpensive — $50 per year for a personal license, or $100 per year for business. (Individual advisors may be able to use the personal license; you only need the business license if you have staff members.)

Boxcryptor encrypts documents on your computer before you send them up to the cloud. The advantage here is that neither Dropbox nor Google Drive will be able to see anything about those documents you’re storing in those cloud systems because of the encryption on them.

This is a way to ensure you can store all your documents using a cloud-based storage system. You can also share access on encrypted documents. You can set up folders where your clients can upload documents and they’ll be automatically encrypted, too. It’s very easy to use.

Another option is to simply move away from storage solutions like Drive or Dropbox and use a system like ComConnect File Sync. SpiderOak is another solution that offers built-in encryption.

Additional Recommendations for Working with Sensitive Documents

Here are a few additional tips to try when setting up compliant document storage for your RIA:

  • Always use 2-step authentication
  • Use a password management system like LastPass or RoboForm
  • Set up very secure security questions, or randomize your answers just like you can randomize password characters and numbers

Compliant document storage is a topic that we’ll continue to revisit and seek to understand in the future. With the pace at which technology grows, we — as an industry — will constantly need to find new solutions, better security, and ways to remain both compliant and proactive about keeping files safe.

If you have additional questions on this topic, the go-to expert in this area is Blane Warrene. You can visit his site at or connect with him on Twitter @blano.

How to Create a Business That Supports Your Great Life

VAAsk yourself this question: what does your ideal life look like? There’s no wrong answer. It’s about what’s important to you. Your answer should reflect what you value.

But no matter what your answer is, it’s likely that you need a good deal of flexibility and freedom to live that life of your dreams. And that’s what the case for working virtually – even as a financial advisor – is all about. Working virtually allows you to create a business that supports your great life.

If you want to learn more about why and how to make this happen, XY Planning Network has a new (and free!) ebook to add to your reading list: The Virtual Advisor.

This ebook will walk you through why virtual planning makes sense for both advisors and clients, different ways to create a “virtual” office setup, the technology you’ll need to create a business that’s capable of running from anywhere, what you need to know about compliance, and an in-depth look at how to market your firm. As a bonus, the ebook includes 4 case studies of financial planners who are successfully working as virtual advisors.

Why Advisors Create a Business that Works Virtually

Working virtually opens you up to working with anyone, anywhere. There are no more barriers created by the fact that you and your ideal client just happen to live a few hours (or many hours) away from each other. That provides a lot of freedom not only for you, but for your clients, too.

Being a virtual advisor means your clients can be anywhere in the world, too. They’re no longer limited to working with someone based solely on the fact that the two parties are present in the same town. Your clients get to choose the absolute best financial planner for them, based on what that professional can provide, and not based on where everyone happens to be on a map.

Or your clients can still live in the same town as you do. They can still live within an hour or so of your office. And these are still clients you can work virtually with, because it provides them with a more convenient option.

When you force clients to meet in person 100% of the time – especially if you specialize in younger clients – you’re asking them to make a big time commitment. They have to take off work. They may need to get (and pay for) a babysitter. Then they need to actually get to your office, and deal with traffic and parking.

A one hour meeting becomes a three hour ordeal for those who work, have families, or need to attend to other other responsibilities. Hosting virtual meetings can save time and stress, and can provide a better client experience.

Other clients may always need access to virtual planning services. If you work with servicemen and women or corporate workers who experience frequent relocations, for example, you need a way to stay connected despite distance and changing addresses. Many younger clients are highly mobile and may prioritize their ability to travel and change cities when considering a planner.

Your practice should be designed to care for your ideal client, no matter what. So, no, virtual advisors are not self-serving and virtual planning is not solely for the benefit of the provider. This is a win-win situation for everyone in the highly digital, mobile, technology-focused, forward-thinking world we all live in today.

Bottom line: working virtually means your clients can be off and enjoying their great lives, too. Great lives that, as their financial advisor, you undoubtedly helped them think about, plan for, and reach through smart money moves.

Do You Want to Stand Out with Your Services?

The virtual advisor is different. They’re able to build a business that’s flexible, adaptable, and forward-thinking. They provide a level of service, convenience, and accessibility to their clients that planners who will only meet in person cannot offer. The virtual advisor is no longer limited by location. They can serve anyone, anytime, anywhere.

The ability to work virtually is becoming increasingly valuable in a digital world full of tech-savvy clients who may prefer having a quick chat on Google Hangouts to meeting at a physical location. This doesn’t mean you need to go 100% virtual. But the ability to provide some level of virtual planning services to your clients who want (or even require) it makes you and your business more marketable and able to serve a wider section of the consumer market.

If you want to start working virtually, this ebook provides you with the information, tools, and resources you’ll need to get started. But if you have further questions, don’t hesitate to read out to the leading network of fee-only advisors who specialize in working with Gen X and Gen Y — and who all offer some form of virtual planning services for those clients.

That’s XY Planning Network, of course! After you get your free copy of The Virtual Advisor, be sure to:

Get Your Copy of The Virtual Advisor

In The Virtual Advisor, we’ll explain why working virtually makes sense for both you and your clients, how to set up and efficiently run a virtual business, and what you need to know to handle compliance issues and marketing yourself both locally and online.

If you’re ready to build a business that supports your ideal life and is recognized for being forward-thinking as the next generation of financial planning arrives, download your free copy of The Virtual Advisor right here.

And if you’re interested in learning more and getting the expert take on the ebook, don’t miss this review by Michael Kitces: The Emergence Of The “Location-Independent” Virtual Financial Advisor

Bonus: Book Review from Cristina Guglielmetti, CFP®

Want to hear what other advisors have to say before downloading your copy? Check out this review from Cristina Guglielmetti:

The book cleanly lays out the options available to someone thinking of starting their own practice, including some you probably haven’t considered. It encourages you to think beyond the traditional advisor box to really decide how you want to deliver your services, and to whom. It anticipates common questions around technology and compliance, and compares the expenses and pros and cons of virtual vs physical offices. The book points out the possibility of a hybrid model, working mostly virtually but offering the chance to meet in person for certain meetings*. And regardless of where your clients are, local networking and marketing will remain to be important to growing your practice.

Of note, many of the recommendations in the book will apply to new advisors regardless of how they choose to design their business: choosing a niche, differentiating yourself, and being familiar with the tech tools available are important even if you’re planning to go 100% traditional, with a physical office and only in-person meetings. Your clients will be conversant in these technologies and will expect you to be as well.

Overall, this is a handy how-to for anyone considering pursuing being an independent financial advisor, and successfully addresses the long list of questions everyone has when they’re thinking of making the move.

*On a personal note, this is how my practice is taking shape. A lot of my clients are local, and they specifically want someone local (perhaps for the familiarity with the NY real estate market and school environment since most of them have kids around the same age as mine, general familiarity with NY-centric issues, etc.) But while all of them have chosen to meet in person at least once, they all like the fact that they don’t have to if it’s a burden schedule-wise to make it happen.

— Cristina Guglielmetti, CFP®
Future Perfect Planning

Why Financial Planners Should Embrace Robo Advisors

Please welcome guest contributor Andrew Mohrmann to the XY Planning Network blog! Andrew is an XYPN member, and today he’s sharing his take on why financial planners don’t need to fear robo advisors — and how they can even embrace these technologies instead of trying to beat or avoid them.

Financial Planners and Robo Advisors

If you’re in the financial services industry, chances are you are well aware of the robo advisor emergence over the past 5 years. Many have lamented this as a disruptive technology, poised to put tens of thousands of financial consultants, wealth managers, financial planners or any other title for a living, breathing advisor out of business.

Case in point: this recent article cites that 76% of advisors view online advice — and robo advisors — as a threat to their practice.

I’m simply not buying it. Instead, I feel that these technologies will only augment my ability to provide my clients with objective, transparent and comprehensive financial planning. As I developed Modern Dollar Planning earlier this year, I chose to partner with Betterment Institutional to manage my clients’ assets.

Why and How I Embraced Robo Advisors

Prior to starting my firm, I spent the better part of my 20’s working at two of the nation’s top independent RIA firms where I had the opportunity to learn firsthand the value of taking an academic, long-term, and low-cost approach to investing. I don’t subscribe to marketing timing, stock picking or the idea that I can beat the market.

Instead, I look to build a portfolio for my clients (and myself) that is appropriately allocated, keeps costs low, and keeps me from reacting in volatile markets. Betterment’s approach fits well with my own philosophy on investing. I then get to focus on the issues that are going to have a bigger impact on my young clients’ lives, such as creating sustainable budgets, restructuring student debt or mortgages, making the most of their employee benefits, avoiding expensive insurance products, or even helping them craft a plan for leaving the corporate world.

I get to know them well and help them prioritize the financial steps to reach their big picture goals.

Utilizing the Tools That Are Already Available

If I were to secure a relationship with a more traditional custodian like Charles Schwab or TD Ameritrade and design new portfolios from scratch, they would end up looking very similar to those of robo advisors like Betterment. If you looked under the hood, you’d see primarily low cost funds from Vanguard, IShares and other economical index options.

So as I looked at investment management options, I figured, why try to recreate the wheel that Betterment has built? Their platform affords my young clients the ability to invest small amounts monthly at zero trading costs. They take care of time consuming rebalancing and investment of cash from dividends or deposits. I also don’t have to add on expensive portfolio reporting software.

Now when it comes to investment management, I get to spend my time helping clients with big picture asset allocation/location, determining safe savings rates and keeping them from falling prey to fear, or greed in tumultuous market periods.

People Want More Than Software

As I completed an MBA during my time at my previous high net worth advisory firm, I began to have classmates and friends start inquiring about working with me. Unfortunately, most of these folks simply didn’t have the assets to meet my firm’s minimums.

I’d point them in the direction of a low cost solution like Betterment. Surprisingly, very few of those people actually followed through on my advice! I found that when it came to their money, even though I had told them what to do, they were reluctant to use the cheap online offerings. They wanted a personal relationship that provided some assurance and answers to their questions.

It was disappointing to see my friends pass over what I knew to be strong investment options because they weren’t confident in leaning on technology like robo advisors alone.

The rollout of Betterment’s institutional platform was actually one of the main reasons I felt that I could go out and successfully start my own practice catering to my generation (I’m 29). I view partnership and effective use of the new technologies hitting the scene as a catalyst to my success.

Even Gen X and Y Are Willing to Pay for a Trusted Financial Partner

One of the first prospects that became interested in working with my new firm was a mid 30’s executive at a Fortune 500 company. He loved the objectivity of my offering and decided to engage me for a single meeting Strategy Session, where we isolated a few financial planning topics of concern to him.

During that meeting, I uncovered the fact that he had significant assets for his age with an agent at a big insurance company. He was paying front loads and about 1.3% in expense ratios/12b-1 fees for proprietary funds.

I explained my philosophy on investing in more of a passive manner, keeping the costs low, rebalancing, and so on. We talked about the way that commissioned brokers are paid and the differences in incentives working with a fee-only financial planner vs. a captive agent.

A few weeks after our successful strategy session, he contacted me and asked if I would manage his investments. I happily said yes and we set up another meeting to discuss allocation and execute the transfers.

At the outset of this meeting, he mentioned that he wanted to show me a website that a colleague of his had shown him as they talked about investments at work. He opened his laptop to Betterment’s website and I chuckled. I explained to him that Betterment actually had an institutional version that I use to implement portfolios for my clients.

The difference, I mentioned, was that I bring to the table planning expertise that no robo advisors are ever going to replicate, but there would be an additional fee for my involvement. I also explained that I’d have no problem if he decided to go directly to the retail version and save money.

How could I blame him when I use Betterment on behalf of my clients (and for my own assets)?

His next comment took me by surprise. He was very quick and steadfast in his decision that he would still like to use my firm for asset management, despite the fact that he’d be paying more for my help.

During that strategy session, I had cemented in his mind the value of objective financial planning. We had talked about big picture asset allocation, the fact that he carried a very large cash position given his net worth, how he should handle his company stock options, his need for estate documents, and some questions he had around purchasing rental properties some day. We touched topics and ideas that a software program is never going to replicate.

As Long As You Provide Unbiased Financial Planning, You’re Not Replaceable

I don’t view robo advisors as a threat to my new business because I know that I offer clients a value that software can’t deliver if I’m truly doing my job. My clients, even millennials and those comfortable using technology, understand this as well.

By partnering with technology providers like Betterment, I’m actually able to spend even more time helping my clients on the issues where I can drive real value beyond just trading and rebalancing. I’ll leave those rote tasks up to software that can do it more efficiently anyway.

Andrew MorhmannAbout the Author: Andrew Mohrmann is a fee-only financial planner who left the ranks of high net worth wealth management to found Modern Dollar Planning, where he helps 20 and 30 somethings set a new financial trajectory. He is dedicated to helping his generation make smart financial decisions and believes they should have access to objective guidance, regardless of their current assets. You can connect with Andrew on Twitter @Andrew_Mohrmann