Clinton or Trump: Who would be the best president for financial, mortgage pros?

by Ryan Smith29 Oct 2015
The 2016 election is still more than a year away, but it’s looking more and more like it might come down to a matchup between Hillary Clinton and Donald Trump. Both are leading their respective packs in most polls, so while it’s still a long time until Election Day, the contest may well come down to The Donald vs. the former secretary of state.

But which one would be a better president for mortgage professionals and financial advisors? A recent report from TrustAdvisor breaks down the pros and cons of each.


Trump wants to eliminate the estate tax entirely. While that might be a boon for some, TrustAdvisor points out that it might not be the best thing for financial planners. The elimination of the estate tax would also mean the challenges of gift tax, portable marital exemptions and generation-skipping transfers would go with it. Basically, TrustAdvisor predicts, estate planning in its current form goes away if a theoretical President Trump got his way here.

Trump would also eliminate most of the complications of consumer tax preparations, including most upper-bracket deductions. And whenever the notional tax rate drops, it’s going to hurt the bottom line for accountants and financial advisors.

“If Trump really wants to streamline the tax code, I’m sure the upper middle class will cheer,” writes TrustAdvisor’s Scott Martin. “However, advisors who once differentiated themselves as being able to add value on the tax side will need a new competitive proposition.”

On the mortgage side, Trump’s position on the Dodd-Frank Act would probably endear him to mortgage professionals. In an interview with The Hill earlier this month, Trump blasted the legislation.

“Under Dodd-Frank, the regulators are running the banks,” Trump said. “The banks are petrified of the regulators. And the problem is that the banks aren’t loaning money to people who will create jobs.”


Clinton, on the other hand, is a supporter of Dodd-Frank, telling Stephen Colbert on a recent Late Show appearance that she would use the legislation to “impose a risk fee on the big banks if they engage in risky behavior.” She also said she would consider using Dodd-Frank to break up “too big to fail” institutions if necessary.

Clinton’s regulatory plans might not be so great for the financial planning industry either, according to TrustAdvisor.

“We’ve already seen what Hillary can do to traditionally Democrat-friendly industries like biotech simply by opening the door to regulation and profit margin pressure,” Martin writes. “Tens of billions of dollars of market capitalization evaporated once drug pricing became part of the new Clinton platform.”

And, Martin points out, Bernie Sanders’ continued presence in the race could force Hillary into ever more liberal positions on financial matters.

While Clinton is contemplating stricter regulations on the financial industry, most of those are aimed toward “too big to fail” institutions and hedge funds, according to TrustAdvisor. For ordinary financial advisors, she’s probably “another four years of the status quo,” Martin writes.
But advisors’ clients will need their assistance more than ever. Clinton wants to push the long-term capital gains holding period out to six years before the best rates apply, TrustAdvisor reports. If shareholders don’t hold that long, the IRS could end up with up to 43% of their returns.

So who do you think would be a better president for the industry? Let us know in the comments below!


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