Jeffrey Simpson:  The Threat to Knowledge Authorities in the Sharing Economy

One of Canada’s foremost journalists and commentators on public policy shared his insights with attendees on the first day of the 2015 Distinguished Advisor Conference (DAC) in a thought-provoking session in Puerto Vallarta, Mexico. Jeffrey Simpson, national affairs columnist for The Globe and Mail, spoke in detail about the age of dis-intermediation and what that means for advisors.

With the rise of the Internet, and the unprecedented ease of access to information, there is an erosion of respect and support for authority figures of any kind. “Mediators” who analyze and interpret information for others — those in the know, such as doctors, university professors, even travel agents and journalists — are under siege from individuals who trust what they read on the Internet far more than they do these “trusted professionals.”

And it’s no different for financial advisors. Those who try to provide information to clients in the old way will risk losing those clients entirely. You need to change what you’re communicating, and the way you are communicating it, to remain relevant to the new generations of clients and protect them from heresay.

Another sea of change is presented by our aging demographic. For example, only 4% of our population is over 80 years old today; in 2030 that cohort will grow to 10% of the population. No human society in history has ever seen such a big proportion of seniors, and we have no model to deal with the radical redistribution of wealth and transfer of taxpayers to the pension obligations that we are in for.

Other highlights from Jeffrey Simpson’s session:

• The Liberals will keep the promises they made in the election about tax changes, and there will be potential ripple effects: Will higher taxes on the highest income earners mean a brain drain in coming years? Will they affect people’s decision on when to retire, and whether it’s actually worth continuing to work towards higher income rewards?

• We can expect increasing provincial deficits in the future as this layer of government shoulders the bulk of the tax burden for expensive, labour-intensive services such as healthcare and policing, with a declining tax base.  How will that effect wealth accumulations?

• Can the new Liberal government make good on their promise to balance the budget in four years? Probably not.  What will be the effect for taxpayers?

• Canada has the highest rate of immigration in the world and these newcomers almost universally accumulate assets and want a better future for their children. Our increasingly diverse population represents significant growth opportunities for advisors.

The Distinguished Advisor Conference 2016 will be held November 6-9 in beautiful San Diego, CA.  The theme is SOAR HIGHER: Plan for Your Greater Potential and registrations and sponsorships for this extraordinary think tank and professional development opportunity are now being accepted at Knowledge Bureau.