Just one of these scenarios likely would be enough to cause concern for an investor:

• Potential end of the post-Global Financial Crisis secular bull market in equities
• Prospect of the first sustained rising U.S. interest rate environment in more than 40 years
• Highest inflation level in four decades

Yet in 2022, we’re facing all three at once. It’s a potentially catastrophic combination, especially for investors nearing or in the early years of retirement.

In my opinion, this is a “perfect storm” (yes, I know that’s a super cliché saying – even I cringed when typing it). And it demonstrates how the need for a more modern approach to retirement income has never been greater. It also motivated my colleague, Brandon Langley, and I to embark on a research project into different approaches to sustaining clients throughout retirement. Today, we’ve released our findings in a new white paper available to financial advisors, “An Advisor’s Guide to Protecting Retirement Income.”

When we travel by air, my wife usually points out that she thinks it would be better if people by windows boarded first; that way, anyone in an aisle or middle seat wouldn’t have to keep standing up. Meanwhile, I think the Southwest Airlines style of pick-any-open-seat is optimal.

Our “gut feelings” were recently rendered irrelevant when we ran across an old episode of “MythBusters.” In it, the cast built a mock 173-seat aircraft and tested several boarding approaches using real people and luggage.

Relying on the data cut through the emotional biases. It also inspired me to take a similar data-backed look at a common question I hear about systematic investing: Is this style of investing capable of reacting fast enough to declining markets?

A friend recently convinced me to watch a new(ish) Netflix documentary, “14 Peaks: Nothing is Impossible.” It follows a Nepalese mountaineer who attempts to climb all 14 of the world’s peaks higher than 8,000 meters in less than seven months.

Call me a luddite if you like, but few things annoy me as much as when I navigate to a new webpage and that, “How can I help you?” box pops up on the lower right. That chatbot entering uninvited always sends me on a frantic search for how to make it disappear as quickly as possible.

Those bots have fully infiltrated the online world: banks, municipal governments, dental offices, nonprofits. Even a robot for my neighborhood grocery store recently wanted to talk to me when I simply needed to verify the hours!

I think about this scenario as it relates to investors. With so much money moved into robo-advisors, what is the experience going to look like when REAL people have REAL questions? “How did the S&P close yesterday?” is easy for a robot. But what answer is going to pop up when the question is, “The market is collapsing! What should I do?” or, “How do I reduce risk in the midst of this volatility?”

More to the point of this blog: How different would the answer be if it were coming from a trusted financial advisor?

How does that saying go? Something about how the more things change, the more they stay the same?

Within financial advisory practices, this sentiment rings abundantly true in the area of portfolio construction/management.

So much has changed in the past few years. For one, the pandemic altered how investors interact with their advisors. Potentially more importantly, due to the prolonged bull market and relative outperformance of passive strategies, advisors have increasingly focused their attention on generating alpha from tax and financial planning.

And yet, nothing has changed at all: this same up-up-up trajectory in stocks shields many advisors from having to face the critical decision on whether to outsource the investment function of their business.