Social Media Graces
Advisors recognize the growing need to interact with clients using social media, but they do not want to violate compliance rules. To help them out, LIMRA, an annuity industry association, has launched "Insight: Advisor Series." It's a social media training program specifically designed to guide advisors through the potential legal and cultural land mines presented by social networking sites and platforms. A group of five financial services firms have been beta testing the training application for the past several months, according to press reports. The subscription-based app can be accessed online from the LIMRA website or, more commonly, through individual firm's e-learning management systems. Advisors already use those e-learning systems for a variety of training on everything from sexual harassment to educational courses on individual investment products.
Mass Affluence Angst
First Bank of America Corp., owner of Merrill Edge, a platform that serves the mass affluent, is telling advisors what is on the minds of investors with $50,000 to $250,000 in investable assets. It looks like advisors that serve this group will have some serious client coaching to do. In the first place, 45% of 1,000 households sampled believe they will never be wealthy. They are also cautious with their investments, as 36% of them report having a low tolerance for risk. Not surprisingly, 45% also say they are more conservative about investing compared to a year ago. Not all of the results reveal misgivings about investing, though. Merrill Edge found that 53% of respondents work with between three and five financial services companies. And financial planners who prefer to give advice holistically should take note: 58% of respondents say having access to a complete picture of finances and investments in one place gives them confidence about their finances. Also, 57% say their confidence comes from knowing how to allocate assets appropriately across investment options, and 56% of respondents say confidence comes from receiving professional advice.
Average Highs
Fidelity Investments says the average 401(k) balance rose to $71,500 at the end of 2010, the highest in the 10 years since the Boston-based financial services firm began tracking a database of 11 million accounts. For participants who were continuously active for the past 10 years, the average balance increased to $183,100 at the end of last year from $59,100 at the end of fourth- quarter 2000. Fidelity's analysis found that average participant deferrals held steady at 8.2% for an eighth straight quarter. For a seventh straight quarter, more participants increased their total deferral rate (6.1%) than decreased it (3.0%).
