Compensation, cryptocurrencies, diversity and environmental, social and governance investing were the main topics during an Industry Powerhouse Panel at Carson Group's Excell 2021 conference in Las Vegas on Wednesday.
Here are the nine top takeaways from the session:
1. Stop using the term "fee."
"I would challenge everybody to get rid of the term 'fee,'" Ron Carson, Carson Group CEO and founder, told attendees and those watching virtually.
"Who wants to pay a fee? I mean no one likes fees but we're all willing to make an investment in our future," he said.
Carson explained that he tells new clients who may see Carson as more expensive than other firms: "No, we're the best value ever. And, if at the end of three years, you're thinking in terms of a fee you're paying me, we have not done our job."
2. Advisors who don't scale their businesses risk falling behind.
"We're all privileged to be in a growing business," according to David Canter, executive vice president and head of the RIA segment at Fidelity Institutional.
There are about 14,000 RIAs registered with the Securities and Exchange Commission, he said, noting that doesn't even include the number of RIAs with less than $100 million in assets under management who are registered with U.S. states. "That number continues to grow so there's, as I like to say, a bull market for advice."
Noting that most advisors are paid on an AUM basis, with a growing number providing financial planning on an "a la carte" basis, he said: "Advisors must "provide more and more value for our clients."
However, "if you don't have" the scale of a platform like Carson Group's, "whether embedded within your own business or" provided by a partner, "it's harder and harder to provide those services and value," he said.
3. There is a growing shift to "holistic" planning.
"One of the biggest shifts that we've been seeing is this move to holistic planning: providing services above and beyond investment management," according to Suzanne Siracuse, founder and CEO of Suzanne Siracuse Consulting Services.
However, "how do you charge for something like that when it doesn't tie back to the assets that you're managing?" she said, calling that the "$50 million question."
4. The move to flat fees is accelerating.
"The trend that I'm definitely seeing is moving [to] fee for service — so a flat-fee model," Siracuse noted.
"Another really interesting model, in my opinion, is like what Facet Wealth is doing, which is a subscription-based model" in which you pay a flat fee each month and can cancel anytime, she said.
Under that model, advisors will help you with particular tasks, she noted, explaining: "What that does is it really helps clients that maybe can't afford a financial advisor … but it gets them acclimated to what advice can do. And I think that is a huge game changer."
