As the Baby Boomers move into retirement, their $50 trillion in assets will move with them -- and they’ll need professional help with the transition, according to Roger Ochs, president and CEO of broker-dealer HD Vest Financial Services.

In his opening address at the company’s annual meeting for its financial advisors, Connect2016, being held this week in the Washington, D.C., area, Ochs explained that the 120 million households in the United States hold around $100 trillion in assets, in everything from homes and other real estate to retirement and investment accounts, to small businesses, and more. Boomers own roughly half of that, he noted, and as they transition to their post-work lives, they will need to figure out how to structure it so that it meets their income and spending goals.

“They’re going to transition to retirement over the next 15 to 18 years,” Ochs said. “That’s the tsunami of assets that will be transitioning, if you will.”

As an example, Ochs cited the significant amounts of money that will be moving out of 401(k) accounts and into IRAs as people leave their employers -- $439 billion will make that transfer in 2016 alone.

The Boomers will also face major liquidity events as they downsize to smaller homes or assisted-living facilities, and as those who own businesses determine what to do with them.

“Somebody’s got to advise people on all that, and at the same time, there’s been a net decrease in the number of advisors out there,” Ochs said. “That’s a tremendous opportunity.”


Ready for the tsunami 

It’s an opportunity that Ochs believes HD Vest and its advisors are poised to make the most of.

“We’re one of the few who are bringing new advisors on,” he said, noting that the company added 520 new advisors in 2015, giving it a record 4,600.

Vest now has $37 billion in assets under management, with about $10 billion of that in advisory assets.

And on one of the major issues currently facing financial planners -- the Department of Labor’s recently released fiduciary standard -- Ochs is confident that Vest and its advisors will actually benefit from it.

“We already follow a fiduciary standard today,” he said in an interview with Accounting Today. “The DOL standard is way over here compared to the current standard, but our advisors understand fiduciary -- it won’t be a huge stretch for them.”

What’s more, Vest’s “goals-based” approach to planning, which emphasizes a higher level of services aimed at helping clients achieve lifetime success, as opposed to a short-term focus on selling products, will put its advisors ahead when the new DOL rules start benchmarking industry fees based on services provided. 

“We’re in the right spot to be able to comply with the rule,” Ochs said.




Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access