Increase aligns with recent Hearts & Wallets research finding investors value and will pay for tax optimization
BOSTON – February 6, 2017 – LifeYield, a transformative software company helping forward-thinking financial firms, advisors and investors make more and keep more money, announced that the firm has surpassed 75,000 advisor and investor users of their LifeYield Advantage Suite. The solutions arm investors with the digital advice they need to improve after-tax investment and income scenarios, which they aren’t getting via traditional methods.
“Retail investors have been aggressively seeking ways to reduce investment costs and improve portfolio outcomes,” said Mark Hoffman, LifeYield CEO and Founder. “We’re pleased an increasing number of investors and advisors are able to reduce the cost of taxes on their portfolios, which is their single largest cost over the life of the investment. We see tax-optimized household management as the next big wave in our industry.”
A December 2016 report, Digital Habits Revealed, released by financial services research firm Hearts & Wallets, found that affluent investors want and will pay for advice to have their portfolios managed in a tax-optimized way across multiple accounts, including tax-optimized withdrawals. The report analyzes qualitative research with investors in three behavioral groups, according to their use of online and financial professional advice.
Further, the report found that the desire for tax optimization was one of the highest-rated pain points among retail investors who were interviewed, whether they were ‘heavy digital,’ ‘light digital’ or users of ‘live only’ advice.
“The quantitative data validate these qualitative findings, with nearly half (44%) of consumers facing retirement stating they want help with minimizing taxes from investments,” explains Laura Varas, CEO and Founder of Hearts & Wallets. The Hearts & Wallets Investor Quantitative Database is the deepest and broadest single dataset on the wants, behaviors and needs of consumers of saving and investing solutions, comprised of over 35,000 respondents since 2010.
“The interesting thing is, 48% think somehow they are getting this, but only 32% say they have execution support,” Varas continued. “Consumers are realizing their retirement income execution isn’t as robust as they thought it was.”
LifeYield, part of the digital advice revolution, is responding to what clients are asking for – lower costs, better outcomes and easy-to-use digital tools.
“Our Tax-Smart Household Management methodology is designed to reduce investment and tax costs, and ultimately improve investor outcomes,” says Hoffman.
The LifeYield Advantage Suite™ of asset-optimizing solutions, includes:
- LifeYield Portfolio Advantage, which reduces taxes during accumulation by maintaining the target asset allocation and locating assets in the most tax-advantageous accounts
- LifeYield Income Advantage, which increases after-tax income across multiple accounts
- LifeYield Social Security Advantage, which shows consumers how to file and maximize Social Security benefits
“Financial advice and guidance is undergoing transformational change, spurred by new technologies and more demanding consumers and regulators, who are all asking why things cost what they do,” says Varas. “While things like investment alpha are experiencing price compression, it’s fascinating to find something like tax optimization that consumers value so much that they want to pay for it.”