Deals & People September 9, 2014

Independent Financial Partners Hires Recruiting Director

Independent Financial Partners (IFP), a hybrid registered investment advisory (RIA), has hired Louis Hanna as its new director of recruiting.
Reported by

William Hamm, CEO of Independent Financial Partners, says Hanna’s hiring is part of an effort to significantly increase adviser recruiting efforts, especially among the retirement specialist community.

“We’ve got about 36 people on our staff now supporting our 500 advisers, of which about 180 are retirement specialist advisers,” Hamm tells PLANADVISER. “While they are the minority in terms of the adviser network, their books of business actually represent the majority of assets under advisement. So retirement is a major portion of our business and our ongoing recruiting.”

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Hamm says much of Hanna’s focus will be on continuing to expand the firm’s hybrid RIA platform, “which means servicing and supporting existing IFP advisers, as well as recruiting and attracting new advisers from wirehouses, regional and independent broker/dealers, and small to mid-size RIA firms.”

Hanna has 25 years of financial services industry experience, including senior level positions with Conduit Advisors, ING Furman Selz, Corigin Holdings, Paradigm Multi-Strategy Funds and American Independence Funds. His previous experience includes adviser consulting and recruiting, financial intermediary wholesaling, liquid alternatives structuring/capital raising and family office capital allocation.

At IFP, Hanna will work with the IFP executive management team to identify RIA acquisition and “tuck-in” opportunities with small to mid-size RIAs. Based on his background, Hanna will also consult with IFP sub-groups and advisers in the network to assist in recruiting, practice and book acquisition, succession planning and practice management.

Hamm says IFP is gearing up to focus heavily on advisers and firms managing between $50 million and $250 million in assets under management. “IFP is committed to providing the ideal solution for these advisers,” he adds, “who are not featured in the media as often as ‘breakaway’ advisers, but run great businesses in their own right.”

More information on the firm and its recruiting efforts is available at www.ifpartners.com.

Data & Research September 8, 2014

Which Findings About Retirement Readiness Are Right?

An optimistic view of U.S. retirement preparedness depends crucially on assumptions about behavior that may not reflect real world activity, researchers suggest.
Reported by

Researchers also make the case in a new paper from the Center for Retirement Research (CRR) at Boston College that optimistic retirement readiness studies often depend on consumption patterns that are unsustainable in the long run. 

The paper, “Are Retirees Falling Short? Reconciling the Conflicting Evidence,” compares studies that found about half of pre-retirees are not on track to maintain their consumption in retirement to studies that found the majority of retirees have adequate resources. Weighing the conflicting studies, the CRR researchers conclude that many retirees can expect to fall increasingly short during their retirement.

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Of all the studies considered, the evidence the researchers found the most convincing about retirement preparedness is the simple calculation of wealth-to-income by age, taken from 10 Surveys of Consumer Finances from the Federal Reserve. The surveys show these ratios have remained unchanged over time, despite longer lives, declining Social Security replacement rates, the shift from defined benefit (DB) to defined contribution (DC) retirement plans, rapidly rising health care costs, and low interest rates. In other words, people retiring in the future will have less resources than those in the past.

A study by researchers for the National Bureau of Economic Research (NBER), using the Health and Retirement Study (HRS) and a life-cycle model of optimal wealth accumulation and decumulation, concludes that the majority of preretirees do have an optimal level of wealth. Separately, RAND Corporation researchers, using HRS consumption data, found households that retired between 2001 and 2007 experienced only small declines in consumption, suggesting adequate resources.

The CRR researchers note that the optimal saving conclusion that emerges from NBER researchers’ model rests on two key assumptions: households are content with declining levels of consumption in retirement; and households reduce their consumption when children leave home. “These assumptions make it much easier for older households to achieve target levels of wealth,” the CRR researchers wrote.

They also looked at households’ ability to maintain consumption after retirement, questioning whether the households studied by the RAND Corporation researchers possess sufficient resources to maintain their spending for the remainder of their lives, and whether they maintained their spending as they aged.

According to the research report, the key question is whether these assumptions seem plausible, and bits and pieces of evidence exist on both sides of these assumptions, so answers to this question are not yet conclusive. In addition, the researchers say considering that consumption does not decline early in retirement ignores the fact that many people do not have the resources to continue consuming at that pace over their entire retired lives.

The CRR researchers’ report can be downloaded from here following a free registration.

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