Fourth Annual Advisor Authority Study Reveals Vast Majority of RIAs and Fee-Based Advisors Expect Tax Reform to Benefit Clients–and Are Taking Proactive Measures to Address Clients’ Concerns
"The Tax Reform and Jobs Act is anticipated to have winners and losers across the financial services landscape. Our research shows that despite advisor optimism, investors are less confident, so RIAs and fee-based advisors are taking action to clear up the complexity and develop proactive strategies for clients at every level, from the ultra-high net worth to the mass affluent," said
When it comes to the newly passed tax reforms, RIAs and fee-based advisors are already taking proactive action on behalf of their clients, with 8 in 10 (79%) saying they are adapting their approach to tax-advantaged investing in response. RIAs and fee-based advisors recognize their clients' ongoing anxieties about taxes, which continue to be complex and can be one of the biggest investment expenses a client will pay, when federal and state taxes are combined. This year advisors rate taxes among clients' top three financial concerns over the next 12 months and among the top three macro factors most adversely impacting client's portfolios over the next 12 months.
As tax season approaches, investors say that they remain apprehensive—and despite advisor optimism in tax reform's benefits, investors are less confident. Year-over-year, taxes continue to be among investor's top concerns. When asked to identify their biggest financial concern over the next 12 months, investors rated taxes second, tied with protecting assets. When asked what macro issue would most adversely impact their portfolio over the next 12 months, investors this year rated taxes number-one, tied with global instability.
Yet, despite their ongoing concerns over the impact of taxes, and a relative lack of confidence over the benefits of tax reform, little more than one-quarter (28%) of investors say tax reform would increase their likelihood of working with an advisor in the next 12 months. This represents a unique opportunity for advisors to educate their own clients and prospective clients about the benefits of a holistic approach to financial planning that includes a focus on taxes.
In turn, 6 in 10 RIAs and fee-based advisors (60%) say that tax reform will provide them with the opportunity to expand their services and generate more business related to tax planning. Just as the vast majority of RIAs and fee-based advisors are optimistic that their clients will benefit from tax reform, more than three-fourths of advisors (77%) also believe that they will benefit.
The fourth annual Advisor Authority study explores the investing and advising issues confronting RIAs, fee-based advisors and investors—and the innovative techniques that they need to succeed in today's complex market. It features a special focus on the most successful advisors and the most affluent investors. These initial findings are to be followed by a series of ongoing reports that will be released from May through year-end 2018.
About Advisor Authority: Methodology
The fourth annual Advisory Authority Survey was conducted online within
Investors are weighted where necessary by age by gender, race/ethnicity, region, region, education, income, marital status, household size, investable assets and propensity to be online to bring them in line with their actual proportions in the population.
About Jefferson National
Jefferson National, operating as Nationwide's advisory solutions business, is a recognized innovator of a leading tax-advantaged investing solution for RIAs, fee-based advisors and the clients they serve. Trusted partner to a network of more than 5,000 advisors, Jefferson National provides greater efficiency, transparency and choice through an adaptable technology platform, award-winning distribution strategy and cost-effective servicing capabilities. Named the industry "Gold Standard" as of 2012 and winner of more than 50 industry awards, including the DMA 2010
About Nationwide
Nationwide, a Fortune 100 company based in
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