Schwab brought da’ noise, brought da’ funk to kick off its annual IMPACT conference Wednesday morning.
The institutional investment behemoth entertained the sleepy advisors in attendance with a live band belting out classic hits prior to Schwab Advisor Services’ Bernie Clark taking the stage. Clark, who took a moment to thank veterans for their service, noted the 1,800 advisors in Boston to mark this, the 25th anniversary of the first IMPACT conference. He added they represent $1.1 trillion in AUM and represent close to half of the assets Schwab custodies.
Describing some of the events that have taken place in the conference’s quarter-century history, he pointed to the good (democratization of Wall Street, advent of the Internet) and the bad (the terrorist attacks of 9/11, the economic meltdown of 2008).
“Although we experienced these major events, I think about your clients on the days that nothing is really happening, and whether they’re comfortable that someone is at the witch and watching on their behalf,” Clark said.
As this year’s chairman of the Foundation for Financial Planning, a pro bono outfit dedicated mainly to military families and financial planning, he announced a new grant, bringing Schwab’s total contribution to their organization to $2 million. He also announced a new initiative with Deena Katz of the financial planning program at Texas Tech University to provide financial planning education to high school students.
He specifically emphasized the “estimated $23 trillion in assets” outside the RIA channel, and claimed the number is even higher for accounts with less than $500,000.
Joined by Schwab CEO Walt Bettinger, he asked about new initiatives at the firm.
“I’m proud that we are opening the 401(K) market to advisors,” Bettinger responded. “The answer to that market is to offer customized, personalized advice in a way that makes economic sense. Traditionally, the 401(k) structure had made sense for the record keepers, trustees, sponsors—really everyone except the employee. That is changing.”
Invariably, the subject of robo advisors came up, with Clark noting the “emotional” response to Schwab’s announcement of certain initiatives in the space.
“Robo is the most overhyped term of the past 20 years,” Bettinger answered with a chuckle. “It reminds me of the hype surrounding Internet banks and how they were going to put Bank of America and JPMorgan out of business. I even invested in a few, but I think I got out before they went under.
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With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
