Advisors Say Tax Reform Top of Mind for Clients and Most Likely to Impact Portfolio Management
Louisville, KY, March 20, 2017— Jefferson National, a leading distributor of innovative tax-advantaged investing solutions for Registered Investment Advisors (RIAs), fee-based advisors and the clients they serve, announced results from its latest survey on the new Administration’s impact on advisor sentiment and approach to investing.
While nearly three-fourths (70%) of advisors say markets will increase over the next 12 months, the vast majority (80%) believe changes in Washington will drive ongoing volatility. Many are taking action by investing more aggressively and more tactically, as well as by adjusting allocations in response to proposed policies. Tax policy is also a key consideration.
“Most RIAs and fee-based advisors are optimistic, but they are bracing for turbulent markets in the face of many unknowns,as Washington lawmakers address a range of key economic and political issues,” says Laurence Greenberg, President of Jefferson National. “While it may be difficult to predict outcomes in times of change, advisors and their clients can benefit by controlling what they can—taking a holistic approach to planning, keeping costs low, and investing for greater tax-efficiency. And as more advisors respond by using tactical management, proactively managing risk and adjusting portfolio allocations, tax-advantaged investing becomes increasingly important.”
A more aggressive approach
More than 40% of RIAs and fee-based advisors surveyed have already adjusted clients’ portfolios in response to the new administration’s proposed policies. Of those who have made adjustments, 72% have invested more aggressively and 83% have invested more tactically. Likewise, more than three-fourths (78%) have adjusted holdings of sectors or securities that are expected to benefit under the new policies, and nearly two-thirds (61%) have adjusted the interest rate sensitivity of bond portfolios.
Tax reform is top of mind for advisors and clients. Advisors say that tax reform (63%) is the proposed policy which is most likely to cause them to adjust or plan to adjust clients’ portfolios. This is followed closely by deregulation (60%) and infrastructure investment (56%), while trade policy (42%) and immigration policy (11%) are less likely to have an impact. Likewise, tax reform is the proposed policy that clients want to discuss most often with respect to their portfolios. At 53%, tax reform is cited roughly twice as often as deregulation, infrastructure investment, trade policy and immigration. This aligns with the findings of Jefferson National’s most recent Advisor Authority study of more than 1,300 RIAs, fee-based advisors and individual investors nationwide, which cited taxes among investor’s top three financial concerns—and the number-one financial concern of Ultra-High Net Worth Investors.
To view more findings from Jefferson National’s Washington Impact Survey, financial professionals can download this infographic.
Survey Methodology:
This Washington Impact Survey was conducted online by Jefferson National from February 2, 2017 – February 20, 2017. A total of 292 RIAs and fee-based financial advisors completed the survey for a confidence level of 90% +/- 5%.
About Jefferson National
Jefferson National is a leading distributor of innovative tax-advantaged investing solutions for RIAs, fee-based advisors and the clients they serve. Trusted partner to a network of 4,000 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” and winner of more than 50 industry awards, including the DMA 2010 Financial Services Company of the Year. The company serves advisors and clients in all 50 states and the District of Columbia, through its subsidiaries Jefferson National Life Insurance Company and Jefferson National Life Insurance Company of New York. To reach our advisor support desk, please call 1-866-WHY-FLAT (1-866-949-3528). To learn more, please visit our website and follow Jefferson National on Twitter at @jeffnat.
