Product and Service Launches – 11/27/24

Strive Makes Direct Indexing available on Fidelity and Schwab platforms; Alera Group deploys TIFIN @Work’s AI-powered platform; Vanguard launches 2 ETFs.

Strive Makes Direct Indexing Available on Fidelity and Schwab Platforms

Strive Asset Management LLC announced that its Direct Indexing, powered by Vestmark VAST, is available on both the Fidelity Investments and Charles Schwab platforms.

Strive’s Direct Indexing allows investors to track an index’s performance through ownership in individual stocks, instead of through an exchange-traded or mutual fund, while providing enhanced customization and ownership control. The strategy can also deliver potential tax benefits, including daily scanning for tax loss harvesting opportunities and the option for in-kind transfers from existing equity portfolios.

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Strive’s Direct Indexing includes full proxy voting coverage and corporate engagement from the firm’s in-house corporate governance team without regard to environmental, social and governance or diversity, equity and inclusion constraints.

“97% of U.S. Large Cap companies had drawdowns of 10% or more at some point during the 2023 calendar year,” Matt Cole, the CEO of Strive, said in a statement. “In 2022, the number was 100%. To be able to harvest those losses on a daily basis while also receiving the pro-shareholder governance that Strive provides is something investors cannot get anywhere else.”

Alera Group Deploys TIFIN @Work’s AI-Powered Platform

Alera Group Inc., a national insurance and financial services firm, announced the deployment of the TIFIN @Work AI-powered workplace benefits and wealth management platform. Alera Group’s retirement plan services practice has integrated TIFIN @Work with its FinWell Connect financial wellness program.

“Other platforms fill gaps; TIFIN @Work drives true engagement and business growth,” Christian Mango, Alera’s executive vice president and national practice leader of retirement plan services, said in a statement. “We’re excited to offer a modern solution that benefits both employees and advisers.”

Through TIFIN @Work’s AI-driven platform, Alera Group’s retirement plan participants will receive personalized guidance, connecting them with financial experts.

“Partnering with Alera Group marks a pivotal step in uniting workplace benefits with wealth management,” Marc McDonough, CEO of TIFIN @Work, said in a statement. “TIFIN @Work is the bridge from retirement to financial confidence, enhancing employees’ financial journeys and expanding advisors’ reach and impact.”

Vanguard Launches 2 ETFs

Vanguard announced plans to launch in the first quarter of 2025 two ETFs intended to help investors manage their short-term liquidity needs. Vanguard Ultra-Short Treasury ETF and Vanguard 0-3 Month Treasury Bill ETF are index ETFs that will offer low-cost Treasury exposure for individual investors and financial advisers.

Both new ETFs can serve as part of an investor’s liquidity tool kit, as both will offer exposure to U.S. Treasury securities, have short durations and low volatility, and are expected to have tight bid-ask spreads.

The ultra-short ETF will hold Treasurys with maturities of fewer than 12 months, while the 0-3 Month Treasury bill ETF will focus on Treasury bills maturing in three months or fewer. “VGUS” and “VBIL” are each expected to launch with an expense ratio of 0.07%, which will position each ETF as the low-cost leader in its respective category.

“VGUS and VBIL can be a solution for those who rely on ultra-short bond funds and ETFs to manage their liquidity needs,” Daniel Reyes, global head of Vanguard’s portfolio review department, said in a statement. “These new ultra-short Treasury ETFs fill the gap between Vanguard’s money market funds and our existing ultra-short-term bond offerings, enabling investors to build portfolios with greater precision using Vanguard ETFs.”

Survey Finds More Parents Willing to Chat With Kids About Finances

More Americans say they want to have ‘money talks’ with their families, according to a Fidelity report.

As Thanksgiving approaches, many families will sit down to share a meal, but not everyone will share a conversation about finances, an important topic in American households as consumers manage through paying higher costs for many basic goods.

The potentially good news is that more people may be more open to sharing financial knowledge than in the past. Fidelity’s “2024 State of Wealth Mobility” found that 83% of adults believe it is important to talk about money management with children, and 67% of parents are already having those discussions with their kids. This shift comes as nearly three-quarters of Americans express optimism that the next generation will achieve a higher level of wealth.

“Helping clients engage their families and the most important people in their life in planning discussions about wealth goals is one of the best gifts you can give,” says Chris Kalich, vice president of wealth offerings, Fidelity Investments. “And yet for many, money is considered a taboo subject with family. All too often, we see families hold off on engaging in these critical discussions until a significant event occurs, resulting in increasingly difficult conversations and decisions. However, it’s so important to ensure the next generation is prepared.”

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Fidelity’s study reveals that while 56% of Americans did not discuss family finances with their parents as children, 82% wish they had, citing the value of early financial education.

Yet despite this optimism, 89% of Americans do not consider themselves wealthy. The path to financial success remains elusive for many, with 19% of Americans who are reluctant to consult a financial adviser citing a perceived lack of wealth as the primary reason.

Seeking Out Financial Advice

For those who do work with a financial adviser, life changes and growing financial complexity often drive the decision. One-quarter of respondents cited events like marriage, childbirth or divorce, while another 25% pointed to increasingly complex financial needs.

Among the relatively small group of Americans who consider themselves wealthy—just 10% of respondents—they did not cite having an adviser as a top reason for their wealth. Instead, they cited strategic investing, early savings habits and consistent paycheck allocations.

Having a solid financial plan emerged as a key factor in feeling financially secure. People with a plan in place were far more confident about building (78% vs. 26%) and protecting (78% vs. 27%) their wealth than those without one.

Still, about 40% of Americans worry about losing their wealth as easily as they earned it, highlighting the pervasive financial anxiety that affects many family dynamics.

As Thanksgiving gatherings prompt reflection, open financial discussions—paired with proper planning—may empower families to face the future with greater confidence.

“The holiday season, when families often come together, may be a perfect time to encourage clients to at least break the ice,” Kalich says. “One way to kick off a conversation is to chat about how they’ve established an estate plan to protect loved ones. Or casually toss how important it is that kids have access to their parents’ personal finance information in case a critical need arises. There is never a perfect time to initiate a conversation—the important thing is to not wait to do it. To make the most of cherishing time with loved ones, it’s critical to have these conversations before any crisis occurs.”

Fidelity’s findings were based on a national online survey of 1,900 U.S. adults aged at least 18 from August 5 through August 20.

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