Another example of what happens when the wealthy die without a will: The latest in a long line of conflicts among the surviving members of Jimi Hendrix’s family settled out of court recently. This particular clash revolved around Jimi’s adopted sister, Janie, contesting the ability of Leon Hendrix, Jimi’s brother, to register and capitalize on Jimi-related trademarks. Jimi died without a will, and his father, James, spent many years fighting for control of his son’s likeness and work. When James died in 2002, he left an estate estimated at $80 million to Janie, who is currently the CEO of Experience Hendrix LLC, which owns the rights to the Hendrix estate. In 2009 she filed a lawsuit to prevent Leon's company, HendrixLicensing.com, from registering Hendrix trademarks - and won an injunction in 2015. This week it was announced the two sides settled out of court and the case was dismissed.
Are Mutual Funds Dying?
Everyone knows that ETFs are smaller, but growing faster, than mutual funds. But Matt Hougan at ETF.Com shows how dramatic that rate of acceleration is by looking closely at Schwab’s Monthly Activity Highlight report. Schwab, the leader in no-load mutual funds, pulled in $253 million into its mutual funds over the past year, compared to $32.8 billion (with a "B") into ETFs; in other words, for every dollar that ended up in a mutual fund at Schwab over the past twelve months, $130 ended up in ETFs. Hougan says this is really more indicative of a trend toward passive investing, and ETFs benefit from that trend. He also points out that in the past year, ETFs surpassed hedge funds on a total AUM basis, topped mutual funds as the product of choice for financial advisors, and gained significant traction in the institutional space.
Should Robos Join Forces?
Instead of attacking each other and defending themselves against established broker-dealers, Timothy Welsh, the president and founder of Nexus Strategy, suggested robo advisors like Betterment and Wealthfront could benefit by joining forces. Analysts at Morningstar said robo need to attract somewhere between $14 billion and $40 billion in AUM to break even on the venture capital currently supporting them, far more than the $2.5 billion that each company currently has. In addition to combining their assets, Welsh suggested that a “Betterfront” could consolidate staff, save on advertising spend, and focus on getting their technology to more advisors, which Welsh said is “a more promising area of robo-technology growth than B2C.”
Fighting Over the Bills
A survey from Utah State University has determined the top six money arguments that end marriages. According to the study, the primary financial causes include merging money, dealing with debt, investing, budgeting, lying about money and emergency planning. The research also notes that couples who fight over money once a week are 30 percent more likely to get divorced. Knowing your partner's credit score, knowing how many credit cards your partner has, and having knowledge of all accounts in the marriage can help avoid financial arguments.