RIIA / Boston 2012: Bogle, Meyer Energize the Income Planning Discussion

An Eloquence of Purpose: Grappling with the big issues while honoring the human side

by P.E. Kelley, Managing Editor

L&HA e-newsLink  / LIFE&Health Advisor [email protected]

BOSTON, MA., October 4, 2012  -“We need to make our clients more productive for a longer period of time,” said Francois Gadenne as he welcomed a room filled with about 125 financial advisors earlier today, as the Retirement Income Industry Association (RIIA) commenced its sixth year at the helm of thought-leadership for the financial planning industry.

Convening at Boston’s Omni-Parker Hotel today and tomorrow, Gadenne, the group’s executive director, identified his membership as “outliers,” those who “see the problems that others don’t, ” while trying to expand the job of advisor to consider not just assets under management but to plan for the entire spectrum of human, social and financial capital.

No Man Is An Island

The proceedings began with a brief video-conference, via Skype, with author and Vanguard icon John C. Bogle, who was presented with the RIIA-sponsored Consumer Advocate Award, its first recipient. Bogle delivered a very poignant presentation to the attendees focusing on the basic purpose that every advisor must presume before doing his or her job: to deliver efficient and honest products to their clients. “It’s easy to forget that the individual human being is our main focus,” he said.

Bogle said that the mutual fund industry must necessarily seek to continually improve its value-offer to consumers by creating more efficient products while reducing the sales charges on them. Quoting one of his own books, he lamented that the industry has become guilty of “too much accounting and not enough trust.” His tone was one of concern for how the industry is being perceived. The consumer, he said, must always be “first on our agenda, every single day, and that we must put their interest before our own.” Market share, he added, must be earned, not bought; it should be a measure, not a goal. He ended by quoting the 16th century poet, John Donne: “…no man is an island, entire unto himself.”

Seeing Something Before It Is Visible

Herb Meyer is special assistant to the Director of Central Intelligence and was vice-chairman of the CIA National Intelligence Council during the Reagan administration.  Continuing the theme of recognizing ‘ouliers’ he made a plausible comparison to the work he did in the CIA, which was, essentially, detecting trends and events before they took place, with how this industry might further evolve in a post-crisis economy.  In a far-ranging speech he went back to Europe in the 1600s to identify the very seeds of industrial productivity, which defined the emergence of modern western culture. He compared this in stark contrast to the Islamic world, which has only just begun a similar emergence into a more modern world, triggered by 9/11.

It's easy to forget that the individual human being is our main focus

“We are witnessing the emergence of a global middle class,” he said. At the macro level, the prospects for western Judeo-Christian culture, and for Islam as it begins its journey into modernity, are  nothing short of epic. He touched upon major themes, such as the diminishing birth-rate in many countries and the vision to eradicate poverty, which he believes we will see in our lifetime. Moreover, the U.S., he implied, will be on the leading edge a ‘sonic-boom’ as demand for goods and services grows within this new economic and political framework.


riia2Within this human, global context, which is hard-wired into RIIA’s own mission statement, the tone was set for the remainder of the day’s speakers. Sherri Grabot, CEO of Guided Choice, a company that delivers investment advice to 401(k) participants and other retirement plans,  discussed the relationship between advisor and client at the most critical time in their relationship: as the client transitions into retirement. Retirement, she said, is no longer like turning on a switch. People today migrate into and out of retirement for varying reasons, and need advice, and viable solutions, throughout the process.

Following Grabot, Ben Woloshin, Chris Mayer and Alain Valles delivered an in-depth analysis and tutorial of the reverse-mortgage market, which they believe has become an integral component to the retirement income discussion.

The day’s discussions ended with an enlightening seminar on ‘news trending,’ delivered by James Andrus, CEO of NewsPatterns, which monitors media throughout the world, in real time, to determine larger, global trends that may be emerging but have not yet become evident. From there, he tries to prioritize news events to try to make sense of them. “What are we not thinking about,” he asked rhetorically as he illustrated events that were taking place globally at that moment. He attempted to identify what is worrying investors around the world, and to attempt to learn how to adapt to these emerging trends.

Friday Schedule

The conference continues Friday with more specific topics, including the RMA deisgnation and it’s place in today’s advisor practice; the annuity market and a view integrating Social Security into the retirement income discussion.