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Our Shared Role in the Profession’s Evolution

This issue of Inside Information represents the mission of the publication, and my mission as a writer in the profession.  Each article invites our readers to rethink client service, investing and advice in new and better ways.

Better?  Over the years, I’ve been privileged to witness a long, positive evolution, an evolution where financial planners offered increasingly more valuable advice to their clients, and used better tools to supplement it.  When I started in the early 1980s, financial planning was all about sales, all the time.  The prevailing investment paradigm was the ‘investment pyramid.’  Retirement projections took the historical rate of return and projected that same return, every year, from the date of the plan out to the date of retirement in order to calculate the terminal value of a portfolio.

Since then, we’ve seen the advent of life planning (collecting client goals and objectives before giving advice), more sophisticated investment recommendations based on Modern Portfolio Theory, career tracks and specializations for planning staff, fee-only revenue models, and far more sophisticated financial planning tools that are now trending toward deeper and more client-friendly analytics.  

As we can see on the pages that came before this end-of-issue rant, that evolutionary journey is continuing, and I expect it to do so pretty much forever.

The way the ecosystem works—has always worked—is that an idea emerges from the great laboratory that is the planning profession.  It’s massaged until it starts to work for the benefit of clients or the firm—or it doesn’t.  If it doesn’t, we generally don’t hear about it.  If it does, you hear about it, eventually, on these pages; that is, in fact, our (my) part of the ecosystem.  Others adopt it, refine it, and it becomes mainstream, and we look back and wonder at the lack of sophistication of advisors, say, five or ten or 40 years ago.

In my experience, all of these innovations were initially embraced by a small group of advisors who were constantly looking for something better in every aspect of their professional lives.  We can call them pioneers, the tip of the spear, the innovators who take a new idea and flesh it out to the point where others can adopt it without going through the extra work of experimentation.  

In any given era, there are very few of those early adopters.  I believe that I can count them with surprising accuracy as the Inside Information subscribers and attendees at the Insider’s Forum conference, the small handful of advisors who take time out of their schedule to learn about the innovations, and everything about the innovations, as they are happening, so they can be among the first to adopt them and improve their service to their clients.

The percentage of people who drive the profession forward in its evolutionary journey is, by that count, just under a thousand—out of an overall professional population of (by one estimate) 100,000 or more.  Less than one percent.

The financial planning world owes people like you (the professional one-percenters?) an enormous debt of gratitude for all the progress we’ve made, and are continuing to make, from relatively primitive origins to relative sophistication today.  My guess is that nobody has bothered to thank you for this.  So I’m taking this moment to express deep gratitude to you for your support of our publication, but more importantly, for your role in creating of all the better advice and service that the profession is delivering to clients today and in the future.