FINANCIAL PLANNING REVIEW最新文献

Financial advice has historically been narrowly focused on investing decisions, which has led to skepticism from researchers and policymakers about its value, both in terms of the net alpha and personalization level of advised portfolios. This article explores the potential value of broader, or holistic, financial advice that also covers savings, debt and insurance decisions, which are relevant to a much broader population, not just those with enough wealth to care about investment alpha. The results show that there's tremendous value in holistic financial advice, which is worth $4384 per year or 7.5% of annual income for the typical household and translates into 2472 bps of the median 401(k) account balance. More importantly, this type of advice can be especially valuable for those with lower income who historically have been underserved. While policymakers have traditionally focused on the costs of financial advice, this research suggests that they should also be concerned about ensuring low and middle-class households have access to valuable holistic guidance, which is becoming increasingly affordable by leveraging AI and other technologies.

Using data from the 2021 National Financial Capability Study (NFCS), this study examines how individual investors' financial sophistication influences their response to the stock market in two scenarios: when the market drops by 20% and when the market increases by 20% for a brief period. The findings indicate that, relative to holding stocks, individual investors with higher levels of financial sophistication are more likely to purchase additional stocks and less likely to sell stocks when they experience a market drop for a brief period. Similarly, the study investigated how individuals react when the stock market rises for a short period and discovered that they are less inclined to buy and sell stocks than to hold them. Additionally, the results of this study provide insight into the case of myopic loss aversion (MLA), a supplementary finding of this paper. In addition to finding investors' optimal choice of buying and selling when the market moves, the present study provides supporting findings regarding the number of information sources used and trading frequency, all of which make a strong case for the influence of financial sophistication on MLA. In light of the recent COVID-19 and the ensuing volatility in the stock market, understanding how financial sophistication influences investors' reactions to the stock market is crucial for researchers, financial professionals, and policymakers.

Procrastination in estate planning poses significant challenges in personal financial planning. Despite recognizing its importance, many individuals delay estate planning, risking unplanned estate distribution and family conflicts. This procrastination, driven by discomfort and perceived ample time, leaves legacy unstructured, failing to meet the testator's wishes and needs. Understanding procrastination in estate planning is crucial as it affects financial security for surviving dependents and the orderly transfer of assets. Procrastination research, although extensive in academic and professional contexts, has not adequately addressed estate planning, leaving a gap in comprehending this behavior within financial decision-making. This article systematically analyzes procrastination in estate planning, presenting a theoretical framework based on the Rubicon Model and incorporating the mood-repair hypothesis and temporal motivation theory. It outlines the estate planning process, identifying phases where procrastination occurs and the possible reasons behind it. The framework explains how negative emotions and discounted future benefits contribute to delays, impacting the timely completion of estate plans. The article highlights the role of financial advisors in helping clients navigate estate planning, offering practical recommendations to improve client engagement and ensure better financial outcomes.

This paper explores factors influencing the success of financial planning programs in higher education. It can be used as a guide in the development of a financial planning program. Using a mixed methods approach, the study combines a comprehensive survey of past and present CFP-Board registered program directors and in-depth qualitative insights from the authors' own experiences. The survey encompasses demographics, competition participation, job placement, and perceived administrative support. Key elements of a successful program such as curriculum design, student engagement activities, diversity initiatives, faculty recruitment, and institutional support are discussed. Experiential learning opportunities, outreach efforts for diverse talent, and networking events emerge as critical factors in a successful program. Insights from program directors emphasize the importance of ongoing curriculum development aligned with professional trends, interdisciplinary perspectives, and real-world case studies. Challenges include resource constraints and faculty staffing. The findings offer insights for program directors, faculty, students, administrators, and other professional designation programs to enhance program quality, diversity, and impact, serving the needs of students and the broader community. The findings provide an outline for other professional programs (i.e., CFA or CPA) in how to design, implement, and run a successful program.

Researchers have studied factors that influence the sustainability of retirement withdrawals (e.g., withdrawal rate, withdrawal rules, volatility, asset allocation, taxes, longevity) for 30 years. The frequency of withdrawal patterns (e.g., annual, quarterly, monthly) has escaped inquiry. This study uses Monte Carlo simulation to show that, despite intuitive reasons to believe that dividing retirement withdrawals into smaller amounts over more frequent intervals might control volatility or sequence of return risk, withdrawal frequency has no effect on retirement withdrawal sustainability. This result is robust to simulated markets characterized by: (1) a random walk, (2) simulated markets that are autocorrelated, (3) historical returns series randomly chosen from historical return records, and (4) historical returns in their original sequence. It also highlights factors (e.g., time in market, matching withdrawals to spending patterns, and maximizing optionality) that can enhance value or increase retiree utility.

While an emerging body of research has documented the significance of estate planning, there remains limited understanding regarding the extent of Black adults' engagement with estate planning in the United States. The objectives of this study were to examine whether the utilization of financial planners, the status of inheritance receipt, and religion are associated with engagement in estate planning among U.S. Black adults, and how these associations vary based on life insurance policy ownership. Participants for this study were 673 U.S. Black adults aged 25 and older who completed an online survey in July 2021. We estimated logistic regression models to predict Black adults' engagement in estate planning. Results indicated that in fully adjusted models, Black adults who used the services of a financial planner had significantly higher odds of executing a valid will or trust than those who did not seek assistance from a financial planner. The status of inheritance receipt, frequency of attendance at religious services, and ownership of life insurance policies were positively and significantly associated with engagement in estate planning among Black adults. However, as a moderator, patterns did not differ significantly depending on whether they owned life insurance policies. These findings may assist professionals and other stakeholders in financial planning to develop strategies or interventions to enhance estate planning for U.S. Black households.

This study proposes a simple theoretical model to compare dollar cost averaging and buy-and-hold strategies for investors who perceive that equity's unobservable fair (intrinsic) value is symmetrically dispersed around the observable price. For reasonable model inputs, the study shows that if the fair value dispersion is relatively high, dollar cost averaging can be superior to a buy-and-hold strategy.