In the News

5 predictions for robo advisers and digital advice in 2018

Alessandra Malito, Dec 29, 2017

Digital investing advice has evolved in the past several years from digital-only to a hybrid that includes advice from human beings — and assets on these platforms have grown substantially. In 2018, experts expect that trend to continue, but with a face-lift for the traditional and hybrid “robo advisers.”… Calculators are popular among digital advice platforms, because they allow consumers to assess where they stand financially or how much they can invest, but videos created by financial institutions that explain confusing terms and investment strategies will become more prevalent as the younger generation ages — 43% of people 21 to 39 years old are watching videos about finance, compared with 29% of midcareer adults 40 to 52 years old, said Laura Varas, founder of research firm Hearts & Wallets....

More Clients Take a Hybrid Approach to Investing

Sean Allocca, Dec 20, 2017

Robo advisory firms aren't the only ones increasingly adopting a hybrid approach. More than 40% of all investors now use some combination of human and digital advice, according to new research from the consulting firm Hearts & Wallets. “The term is going to be decreasingly useful,” says Laura Varas, chief executive of Hearts & Wallets....

Why Investing Conversations Are Changing

Bridget Doyle, Dec 15, 2017

Investors are growing less reliant on traditional advisory services, according to a new study put out this week by Hearts & Wallets. Focused on understanding the "hybrid investor" (those who use a mix of online advice and live professionals) the study looks at how investors, including plan participants, access informative financial resources....

Survey: 41% of Households Mix Digital, Human Financial Advice

Staff writer, Dec 14, 2017

Individual investors are slowly abandoning pure self-direction and are turning to financial professionals for advice, according to a new study by an investor data company. But this isn't a return to the way things used to be, said Hearts & Wallets, the Rye, N.Y.-based research firm that conducted the study of 40,000 individuals....

Investors Blend Data Sources

Noah Zuss, Dec 14, 2017

Retail investors are increasingly consulting many sources for financial advice, with 41% of US households using both live and digital information, according to research Hearts & Wallets released today. The findings’ Implications for asset managers and advisers include getting a hold of which sources are the most influential, Laura Varas, CEO and founder of Hearts and Wallets, said....

Consumers Seek Multiple Sources Of Financial Advice

Dec 14, 2017

Consumers are increasingly seeking multiple sources of live advice and technology and blending approaches to financial decision-making to achieve financial goals in a new report by to Hearts & Wallets, the source for retail investor data and insights....

Fewer People Rely on Employer as a Source of Investment Advice

Rebecca Moore, Dec 12, 2017

“Employer” is the eighth most important source of investment advice and information in 2017, cited as a primary, usual or occasional source by 46% of households nationally, according to a report from Hearts & Wallets. Employer is the primary source for only 27% of households....

Hearts & Wallets: Retirement Income not Investors’ Top Priority

Noah Zuss, Dec 8, 2017

A holistic approach to retirement planning is critical since generating income in retirement is not the top priority for retirement savers, according to research from Hearts & Wallets....

The Biggest Unmet Need For Consumers In Goals-Based Wealth Management

Dec 6, 2017

Managing The Income To Wealth Transition

Dec 5, 2017

A new report reveals the biggest unmet consumer need among nine components in a goals-based wealth management program and the growing role of the spouse in retirement planning, according to Hearts & Wallets, the source for retail investor data and insights. Retirement Income to Goals-Based Wealth Management provides a roadmap to transition from retirement income plans to goals-based wealth management using a consumer-oriented mindset....

Spouses Play Increasingly Influential Role Alongside Advisers

John Manganaro, Dec 5, 2017

A new report from Hearts & Wallets assesses the state of retirement income planning through the eyes of older affluent consumers. The report, “Retirement Income to Goals-Based Wealth Management,” focuses on U.S. retirement savers ages 53 years and older with more than $100,000 in investable assets....

Now or Later: Investors Weigh Rainy Day Savings v. 401(k)s

Emile Hallez, Nov 14, 2017

Americans are more concerned with saving for a rainy day than preparing for retirement, according to recent surveys. The results reflect a trend that emerged several years ago but has since become much more pronounced, two reports issued this week by Hearts & Wallets indicate....

Health Care Overtakes Social Security As Top Consumer Concern

Nov 9, 2017

Building bigger emergency funds continues to grow in importance as the top goal, while health care has overtaken Social Security as the top consumer concern, with more Americans reporting health issues and thinking about how to save for health care, in two new research reports by Hearts & Wallets, the source for retail investor data and insights....

Financial Dreams, Worries and Growing Appetite for Financial Guidance

Nov 8, 2017

Consumers Not Receptive to Employer-Provided Retirement Planning Resources

Lee Barney, Nov 8, 2017

Only about one third (35%) of U.S. consumers use or would use “retirement planning resources provided through employer” while 41% do not or would not, according to Hearts & Wallets research....

Mutual Funds’ Use is Plunging

Nov 1, 2017

Just 39% of U.S. households own mutual funds, down from 63% in 2010, according to Hearts & Wallets, a retail investment data and analysis firm. Younger investors especially have turned their back on the vehicles....

Investors Bailing On Mutual Funds

Karen DeMasters, Oct 30, 2017

The percentage of households invested in mutual funds has dropped drastically over the past seven years, says Hearts & Wallets, a source of retail investment data and analysis....

Investors: Most Fund Managers 'Interchangeable and Irrelevant'

Bradley Saacks, Oct 30, 2017

The last thing any asset manager wants to be is replaceable, but waning brand awareness among end investors is putting even the bigger fund brands at risk of just that, new research from Hearts & Wallets suggests. As asset managers increasingly focus their product development strategies around distributor wishes, end investors are losing track of who is investing their savings, according to the research and consulting firm....

Younger and Experienced Investors Receptive to Actively Managed Products

Ted Godbout, Oct 30, 2017

When viewing investors across life stages and assets, there is a common belief that actively managed investment strategies are too expensive....

These are the people financial advisers ignore

Richard Eisenberg, Oct 25, 2017

Hearts & Wallets: Target younger investors when selling models

Yun Li, Oct 24, 2017

Asset managers may be going after the wrong market with model portfolios as younger investors prefer packaged products, whereas retirees like to assemble component investments, two new reports from Hearts & Wallets shows....

The Awakening: How Younger and Experienced Consumers Will Shape Investment Products

Oct 23, 2017

As mutual funds continue to decline, falling from 63% of U.S. households owning them in 2010 to 39% in 2017, asset allocation and passive investment remain market darlings....

Money Concerns And People That Financial Advisers Ignore

Rich Eisenberg, Oct 10, 2017

In a time when so many people in their 50s and 60s sorely need financial advisers, a new report finds that money pros are often ignoring many of their goals. The result: bad advice or no advice on key financial planning issues for boomers. And wives who aren’t breadwinners get especially short shrift. The report, State of Advice and Guidance 2017, was conducted by Hearts & Wallets, a data and consulting firm focused on the drivers behind retail investor decision making....

The 7 Retirement Moves Couples in their 50s Should Make Now

Penelope Wang, Elizabeth O'Brien, Kerri Anne Renzulli, Sep 29, 2017

Many people head toward retirement as part of a couple. But that doesn’t mean that spouses are working together as a team. Only one-third of couples have even discussed retirement planning, according to a study by consultants Hearts & Wallets. Asked how much money they think they will need for retirement, 47% of couples disagree, Fidelity recently found. And men and women often have different interests in later life, with far more men than women engaging in sports and outdoor activities, and far more women than men getting together with friends and family, according to TIAA research…

Vanguard Puts 401(k) Savers' Retirement Income Front and Center

Beagan Wilcox Volz, Sep 28, 2017

Vanguard has redesigned its participant website to make estimated retirement income more prominent in an attempt to prod greater savings at a time when many say the country faces a retirement crisis… Getting participants thinking about the purpose of their 401(k) account early and often is important for leading them to think more about how they contribute to and manage their accounts, says Laura Varas, CEO of industry research and consulting firm Hearts & Wallets....

Non-Breadwinners Often 'Invisible' To Advisors, Study Says

Karen DeMasters, Sep 19, 2017

A spouse who does not bring in any money is often ignored by financial advisors and hybrid or robo-advisors, according to a study released Tuesday by Hearts and Wallets, a data and consulting firm focused on understanding investors’ decision-making processes. The report found that contributions from the non-breadwinner spouse, as far as the financial security of the family and anticipated inheritances are concerned, often were marginalized when it came to planning for retirement. The study included 39 firms that provide human advisors, online advisors or hybrids providing financial advise to couples in the 53 to 64 age range...

This loophole lets you withdraw early from your 401(k), but should you?

Alessandra Malito, Aug 10, 2017

The Internal Revenue Service has a rule that states individuals can withdraw from a 401(k) plan if they’ve retired, quit or been fired at 55 years old -- that doesn’t necessarily mean they should take it… Hummel makes a point though — most Americans are not in the position to retire at 55, completely cutting off any sources of income aside from their retirement account distributions. Americans are dreadfully undersaved for retirement, and in turn retirees are turning to flexible jobs that allow them some freedom but also an income. About 10% of preretiree households are currently in the gig economy, and 11% of retiree households are in the gig economy, according to research firm Hearts & Wallets....

Serving the Entire Family is Where FAs Have Robos Beat

Thomas Coyle, Aug 8, 2017

Wealth industry experts say a growing recognition of the value of rigorous tax efficiency across household accounts gives traditional financial advisors a potential advantage over no-frills rivals. This article, the second part of a two-part series, looks at ways advisors use off-the-shelf and purpose-built technology to provide comprehensive advice for entire families… On one hand it promises clients cutting-edge efficiencies and a way for advisors to underline their lasting value. But it’s a multi-layered and difficult task, says Laura Varas of the Rye, N.Y.-based consultancy Hearts & Wallets. Fortunately, Varas stresses, the help traditional FAs need to compete as tax-efficient household wealth managers is in view….

Tax Optimization: The Ultimate Differentiator?

Thomas Coyle, Aug 7, 2017

Robo platforms, digital innovation and artificial intelligence dominate fintech coverage in wealth management. But tax optimization is a lower-profile capability with equal potential to revolutionize the industry — not just in customer service, but in terms of the industry’s very topography.… Tax-loss considerations are part of the tax-optimization equation, Laura Varas of the consulting firm Hearts & Wallets tells FA-IQ. But she says the concept also permeates overall goals-based retirement and legacy management — as distinct from, in her view, goals-based planning and investing. “Tax optimization is just what it sounds like: not paying more in taxes than you have to,” says Rye, N.Y.-based Varas. “But,” she adds, “it’s part of a bigger picture”….

Oh Brother: Firms’ Images, Language Shutting Women Out

Staff writer, Jul 9, 2017

Women make up about 10% of the portfolio managers in the U.S., and companies increasingly market products toward female investors. Yet many industry shops continue to use language in investor and other communications that harkens back to decades ago — when advisors were referred to as “customers’ men.”... Seemingly small transgressions such as gendered language in regulatory filings or generic client communications can send a larger message about the culture of a firm — and that can deter top female talent and customers. “I don’t think the message is at all subtle,” says Laura Varas, CEO of industry research and consulting firm Hearts & Wallets. “Using such salutations is akin to telling women they are not welcome, she says....

Does Gigging Work? An increase in the desire to stop work reflects people’s greater control of their ability to work

May 31, 2017

More households than ever (35%) in the past seven years “want to stop working/retire at a certain age,” according to analyses by Hearts & Wallets. After a several-year trend of the majority wanting to work as long as health permits, that group shrank to a minority (45%) this past year. Hearts & Wallets speculates that the increase in the desire to stop work reflects people’s greater control of their ability to work, thanks to the “gig” economy….

Retirees embrace the gig economy

Mary Beth Franklin, Apr 21, 2017

It turns out that the three-legged stool of retirement income may not be not be dead after all. But for a growing number of retirees, the components of retirement income are shifting....

Dear Baby Boomer: Retirement Is This Close, and You Need to Deal With a Few Issues

Steve Fullerton, Apr 19, 2017

I know you’re ready. You’re so close to retirement, you can taste the cool beverages on the beach and feel the sand between your toes… Here are four issues you’ll need to tighten up on in order to enjoy that sunny future… Besides creating a potential dependency problem that could dog your kids for life, all that help is drawing from resources you’ll need when you retire. Parents who are 65 years or older with financially independent kids are more than twice as likely to be retired as those who financially support their adult children, according to a 2015 study by retirement market research firm Hearts & Wallets....

Get ready for senior Uber drivers — the gig economy and flexible jobs are part of retirement planning

Alessandra Malito, Apr 19, 2017

In the future, Miss Daisy may be driving you Future retirees should, and do, expect to work — but in a different way. More than a third of future retirees plan to have employment income, and that may very well come from the gig economy. Flexible work arrangements are favorable for retirees, according to research firm Hearts & Wallets, which surveyed more than 5,000 households. About 10% of pre-retiree households are currently in the gig, or flexible, economy, and 11% of retiree households are in the gig economy. Future retirees expect employment to make up a quarter of their income — the other two common sources of retirement income include Social Security and retirement account withdrawals….

Is Our Low Home Ownership Rate a Risk to Americans’ Retirement?

Beth Braverman, Apr 18, 2017

Home ownership rates have declined dramatically since the housing crisis hit, as potential first-time homebuyers put off a purchase because they couldn’t afford or qualify for a mortgage or because they wanted to preserve flexibility in an unstable economy… Paying a mortgage represents a form of forced savings, as homeowners build equity over the long term. A new report from data and consulting firm Hearts & Wallets finds that for households with less than $500,000 in investable assets, real estate represents more than half of those assets. It represents a third of assets for wealthier households....

More Americans Say They Want to Stop Working and Retire

Rebecca Moore, Apr 17, 2017

However, they may not be saving enough to reach this goal, according to Hearts & Wallets analyses. More households than ever (35%) in the past seven years “want to stop working/retire at a certain age,” analyses by Hearts & Wallets find. After a several year trend of a majority wanting to work as long as health permits, that number dropped to less (45%) this past year. Hearts & Wallets speculates that the increase in the desire to stop work is a reflection of a greater control of their ability to work due to the "gig" economy....

Americans May Not Be Saving Enough to Reach Retirement Goals

Rebecca Moore, Apr 17, 2017

More households than ever (35%) in the past seven years “want to stop working/retire at a certain age,” analyses by Hearts & Wallets find. After a several year trend of a majority wanting to work as long as health permits, that number dropped to less (45%) this past year. Hearts & Wallets speculates that the increase in the desire to stop work is a reflection of a greater control of their ability to work due to the “gig” economy....

Growing Legions of Freelance Workers Speak to IRA Demand

Emile Hallez, Apr 18, 2017

An increasing number of workers in the U.S. are turning to “gig” work for income, a trend that could prove to be an opportunity for IRA providers. About one third of U.S. households have at least one member who works freelance or part time, according to a survey recently conducted by research firm Hearts & Wallets. That represents nearly 28 million of the total 85 million households, and the majority of contract workers say they are employed that way by choice....

Is Our Low Home Ownership Rate a Risk to Americans’ Retirement?

Beth Braverman, Apr 17, 2017

Most trustworthy financial firms according to consumers: Hearts & Wallets

Danielle Andrus, Apr 10, 2017

Hearts & Wallets released a survey in March that identified which financial institutions consumers were more likely to trust....

Most Trusted Brands For Retirement Saving?

John Sullivan, Apr 3, 2017

Financial services companies have 'room to improve' 401k advisors looking to build a trusted brand might want to examine what the following firms are doing right, and then implement it (within reason) in their own practices. Hearts & Wallets found Charles Schwab, Edward Jones, SunTrust, USAA and Vanguard among top financial industry trust earners, especially when it comes to investors’ intent to invest more assets and make recommendations to friends and family.saving Bank of America, Capital One, and Fidelity also earned high marks, specifically in the brokerage space....

SunTrust, USAA Among Most Trustworthy Financial Firms, Consumers Say

Danielle Andrus, Apr 2, 2017

Hearts & Wallets survey finds they performed well despite lower trust in the banking sector overall Hearts & Wallets released a survey on Wednesday that identified which financial institutions consumers were more likely to trust. Regional bank SunTrust and insurance bank USAA were among the top performers, with two-thirds of consumers surveyed giving them high marks in trust. Hearts & Wallets noted that those firms earned consumers trust despite being in the bank category, which consumers rated poorly overall....

USAA, SunTrust, Ed Jones Most Trusted for Fund Sales: Survey

Emile Hallez, Mar 30, 2017

USAA, SunTrust and Edward Jones are the companies that investors said they trust the most when it comes to buying mutual funds, according to results of a recent survey by Hearts & Wallets. Other firms ranked high on that list include TIAA, Prudential, Charles Schwab and Ameriprise. One reason behind some of those companies’ high rankings is that they’ve undertaken campaigns to help customers understand what fees they pay and what the company does to earn that money, says Laura Varas, founder of Hearts & Wallets, a Boston-based research and consulting firm….

Here are the Firms Consumers Trust Most

Mar 28, 2017

Which financial brands do consumers trust most? Among investment firms, customers of Charles Schwab, Edward Jones, SunTrust, USAA and Vanguard are “the most likely to say they intend to invest more with the firms and they would recommend the firms to others,” according to Financial Advisor magazine. The magazine cites a survey of 5,000 consumers by financial research firm Hearts & Wallets. The study encompasses 27 financial services providers. It found that found that Edward Jones, Morgan Stanley and Ameriprise are most trusted when it comes to providing retirement advice….

Customers Name Most Trusted Financial Firms

Karen DeMasters, Mar 28, 2017

SunTrust and USAA are the best at earning customers’ trust, according to Hearts & Wallets, an investment research firm. The two financial organizations received high trust marks from two out of three of their customers in the Hearts & Wallets Stores & Success Metrics study released Wednesday….

What BlackRock's shift to stock-picking machines means for ordinary investors

Tom Anderson, Mar 28, 2017

BlackRock is ditching human managers in some of its actively managed funds in favor of technology-driven strategies... As self-driving cars may hurt taxi drivers and truckers, automation "just hit asset management people who make a half of million dollars a year," said Laura Varas, founder and CEO of financial research firm Hearts & Wallets. "What BlackRock is doing is huge and there will be more to come."….

Firms Fortify Product Development Process

Dervedia Thomas, Mar 26, 2017

A maturing market has forced firms to boost governance and rethink the frequency of launches. The process of bringing a new mutual fund or an exchange-traded fund to market has become more complex with fund managers stacking product committees with staffers from across the firm, rolling out fewer offerings and tapping into adviser networks to vet product ideas, fund providers told FA. "Over the last few... …on how an investor feels about a particular strategy, Laura Varas, CEO and founder of market research firm, Hearts & Wallets, told FA….

Active Managers Must Spell Out Services to Win Trust, Business

Bradley Saacks, Mar 20, 2017

Not many challenge the Oracle of Omaha’s investment choices, but after Warren Buffett’s annual letter to shareholders called active managers “Wall Streeters charging high fees,” American Funds chairman and CEO Tim Armour felt compelled to respond.... Recent data from research firm Hearts & Wallets shows although fee awareness and transparency increased between 2015 and 2016 — fewer than a quarter of consumer respondents said that they don’t know what they pay for investment products compared to 31% in 2015 — the fact is that 41% still did “not at all” understand how providers earn money....

Man vs. machine: How to figure out if you should use a robo-advisor

Tom Anderson, Mar 12, 2017

It sounds like a financial folk tale. Human financial advisors are embodying John Henry the steel-driving man as they fight against the steam-powered hammer of robo-advisors… "Robo-advisor is a misleading term. It lumps a whole bunch of different companies under one word," said Laura Varas, Hearts & Wallets' founder and CEO. Varas' research finds that people use multiple financial institutions to handle their investments. Most investors are dabbling with automated services, but "robo-advisors are a long way away from managing most or all of somebody's retirement portfolio," she said....

The Financial Firms Clients Love, And Why

Karen DeMasters, Feb 28, 2017

“Who Do You Love?” asked Bo Diddley in his famous 1956 rock ’n’ roll song. Hearts & Wallets, a retail investor data and analysis website based in Rye, N.Y., asked the same question of more than 5,000 U.S. households about their brokers, banks and retirement platforms. The answer? USAA, Ameriprise and Edward Jones got the most recognition in the survey, which asked consumers about their favorite qualities in financial service companies, including their service and pricing. These three firms have won trust for a number of reasons, says Hearts & Wallets….

More robo-advisors are adding a human touch to their services

Tom Anderson, Jan 30, 2017

Betterment, a stand-alone automated investing service with about $7 billion in assets, announced Tuesday that it will offer access to human financial advisors... One in 4 people with $500,000 or more in investable assets uses digital tools and a paid advisor, according to a recent survey by financial services research firm Hearts & Wallets....

Hancock to Debut Robo for 401(k), Rollover IRA Markets

Jackie Noblett, Jan 9, 2017

John Hancock is rolling out an automated advice service to plan sponsor clients that relies on technology provider NextCapital to deliver what company officials say will be among the first robo-advisory platforms to provide uniform asset allocation advice, money management and financial planning tools across 401(k) and individual retirement accounts… Most consumers surveyed by Hearts & Wallets last year said they weren’t comfortable leaving their retirement assets at an old employer, but not all 401(k) plan providers with the ability to offer rollover IRA services do it well, says founder Laura Varas. “So there is still room for John Hancock and NextCapital to be distinctive,” she says....

Fidelity, Schwab Robos Favored by Fast-Growing Gen X Market

Jackie Noblett, Jan 7, 2017

As more affluent, but more skeptical, Gen X investors edge out millennials as the biggest users of robo-advisory programs, established distribution brands have an edge... But despite the $8.2 trillion in wealth Gen X represents, the digital advice industry as a whole has placed a much greater focus on younger people, says Laura Varas, founder of Hearts & Wallets....

Why Older Investors Like Human and Digital Advice

Barbara A. Friedberg, Jan 3, 2017

Older, wealthier investors are changing their investment advice preferences. No longer do they just sign up for financial advice from a Certified Financial Planner (CFP) to manage all of their assets, pay a management fee north of 1% and follow the advisor’s recommendations blindly. The rapidly growing robo-advisor trend, along with investors’ growing sensitivity to both high fee funds and high fee advisors, is changing how older investors manage their money. Where Investors Get Advice A recent study by Hearts and Wallets, Explore Pre/Post-Retirees 2016: Digital Habits Revealed, found that one in every four 53 to 74 year olds are likely to combine guidance from both online resources and paid financial professionals….

Retirement planning, estate planning and investing: all struggles

Richard Eisenberg, Jan 3, 2017

Today’s grim financial news: Americans, especially those nearing retirement, are struggling with retirement planning, estate planning and making investment decisions. Those are key findings in the new Pain Points and Actions report from Hearts & Wallets, a noted data and consulting firm focused on understanding the drivers behind investor decision-making. In its annual survey, Hearts & Wallets polled 5,216 adults, oversampling for wealthier Americans, those they dub “late-career” (age 53 to 64) and preretirees who say they’re likely to retire within five years....