Insurable Interest Canadian Insurance Blog

The complaints about change don’t tend to be about the thinkorswim trading platform, which came with the Ameritrade acquisition, since there wasn’t a change there, he explained.  “It tends to be about the mobile app, because the mobile app is what many TDA clients use who don’t use thinkorswim, and they’re going from one experience, TDA mobile, to Schwab mobile,” Craig said, comparing the situation to to a BMW driver waking up one day and finding a Mercedes in the garage and having difficulty figuring out where things are at first. Craig also explained that “what Schwab does is far more significant from a capability standpoint than what Ameritrade did. So as you’d expect, our app, our web experiences are more comprehensive. We’re also a lot larger.” Some former Ameritrade clients ask why Schwab doesn’t just use the Ameritrade app, Craig noted, saying there are many reasons. If Schwab did that, “we’d have three times as many complaints on the blue (or Schwab) side.” Prior to conversions, Schwab’s app and mobile experiences were rated highly, either at par with or better than those of TD Ameritrade, he added. “We’re getting a very, very small number of complaints,” he said. ”They tend...

Before a summer conference pause, a major advisor event recently wrapped in Fort Lauderdale, Florida. The WealthStack conference, in its third year, was dominated by the growing impact and integration of artificial intelligence as well as the accelerating consolidation of the wealth management industry through mergers and acquisitions. Given that backdrop, it was no surprise that the opening keynote was a fireside chat with Joe Duran. Duran gained prominence over the past decade by building United Capital, one of the largest RIA firms, through acquisitions, then selling it to Goldman Sachs for $750 million. At the time, it was thought that this deal would be a preview of the independent space being gobbled up by deep-pocketed Wall Street. Recent events, however, provided ample evidence to dispel that notion. Most notably, Goldman made a 180-degree turn to sell United Capital to Creative Planning, a mega-RIA. Duran, back with his latest venture, Rise Growth Partners, delivered a strong message that inorganic growth is no longer a viable strategy.  “There are many hidden costs to M&A that most people don’t realize, such as the added overhead of running the new location, which can easily surpass $250,000 per year,” he said. Duran described the private...

What You Need to Know The client faced home foreclosure after the advisor failed to make mortgage payments as promised, the DOJ says. The client had worked 40 years for an air conditioning company and couldn’t read. The advisor used his car, rather than his bank employer’s office, to meet with the client. A former Maryland financial advisor who lied about attempting suicide has been sentenced to 3 1/2 years in federal prison for stealing an elderly client’s life savings. Eddy Ray Blizzard, 45, who made a plea agreement, stole nearly $1 million from a now-deceased client, “R.M.,” over many years, causing the man’s home to go into foreclosure a few months before he died in 2020, the Justice Department announced earlier this month. R.M., who had a ninth grade education and couldn’t read or write, started investing and became Blizzard’s client shortly after taking a buyout and retiring in 2003 following a 40-year career as a commercial air conditioning installer in Maryland, according to the department. The client died in 2020 when he was roughly 75 years old, the year after his house was foreclosed on because Blizzard hadn’t made promised mortgage payments,. according to the Justice Department, which said...

What You Need to Know Clients often want to move retirement cash into IRAs. High employer stock prices may lead to capital gains tax headaches. An NUA election can ease the pain. Many 401(k) participants decide to roll their company retirement accounts into IRAs, with or without annuities, for greater investment flexibility. For some retirees, however, rolling over the entire 401(k) may be overlooking a key opportunity. Employees that have significant gains in company stock have another option: a net unrealized appreciation, or NUA, election. As markets trade at all-time highs, this is an election that should not be overlooked. A NUA election allows retirement plan holders to withdraw company stock and send it to a non-qualified investment account. The basics of a NUA transaction are relatively straightforward. The participant can withdraw the stock from the plan and pay ordinary income tax on the basis only. The difference between the basis and the market value at the time of the withdrawal is known as the net unrealized appreciation or NUA. When the stock is sold, the NUA is realized, and only then are gains taxed at the client’s capital gain rate. The difference between the individual’s ordinary income rate and...

The Federal Reserve’s delay of interest-rate cuts in a bid to temper inflation runs the risk of falling behind the curve, according to Mohamed El-Erian. “The Fed pivoted on the basis of data. It was the opposite of the pivot that they did in December — now they have to do a U-turn,”  El-Erian, the president of Queens’ College, Cambridge and a Bloomberg Opinion columnist, told Bloomberg Television on Friday. “As they are doing the U-turn and stay higher for longer, the market is going the other way,” he said. “The Fed is going to have to pivot — not on the basis of inflation numbers, but the basis of the real economy,” he added. Like other market watchers, El-Erian has previously raised the possibility that the U.S. central bank should look beyond its 2% inflation target in a new era of structurally higher pressures on price growth. “Is the inflation target the right target? We all talk about wanting to go back to 2%,” El-Erian said. “Two percent is totally arbitrary. If we are pursuing the wrong inflation target, the risk of a mistake — that mistake would mean sacrificing growth unnecessarily — the risk of a mistake is...