In the shorter term, "current optimism in the market is fragile," Macey said. "2012 may resemble 2011 in that investors will be disappointed after a good start."

Gore said post financial crisis there has been a fundamental shift in clients' focus toward risk management and preservation of capital, and accepting more modest growth within their portfolios.

"On the investment side, we rarely have discussions these days that focus on returns left over from the pre-crisis markets, in other words, can't I get 10%, 12%, etc.," Gore said. "The discussions are more focused on concerns around volatility, mitigation of risk, and portfolio preservation against downward spikes in the market."

Another trend, he said, is that clients are now much more aggressive in providing information, so they can best review and enhance their strategy, and make intelligent decisions. Although many clients seek higher yields on their investments, some are still on the sidelines due to their risk adverse behavior.

One of Gore's clients, discussing his risk and duration parameters, said his maximum maturity should be only 60 days. "Obviously," said Gore, "this doesn't give us much to work with, but the point of the story is there is continuing volatility and principal risk, and to best help the client requires continuing education on the markets, interest rate sensitivity analysis, and risk/return trade-offs."

Gore also said that, in contrast to 2011, the firm is seeing more activity in the planning area, with clients executing plans through gifting strategies, setting up Delaware Dynasty Trusts, and reviewing estate plans.
Kroch explored proposals affecting income, tax, estate and gift planning. She said much uncertainty surrounds current tax planning, making concrete planning difficult. 

The Tax Act of 2010, she said, created enormous opportunities for high-net-worth families to transfer wealth through 2012, and she urged wealth managers to take positive action before the window  closes for many of them on Jan. 1, 2013, unless Congress acts.

Single individuals, for example, may now transfer up to $5 million free of gift and generation skipping transfer (GST) tax, and couples up to $10 million. The 2010 Act also provides a $5 million estate tax exemption and a 35% estate tax rate through 2012. Using the increased exemptions to fund a trust, particularly a Delaware Dynasty Trust, can also be a great way to benefit future generations, she said. But unless Congress acts, in 2013, all three taxes increase to the highest rate of 55% and drop to a $1 million exemption, Kroch warned.

Kroch touched on some contingencies affecting federal estate, gift and GST proposals. Among them are proposals to limit the GST exemption to 90 years; require a 10-year term for grantor annuity trusts (GRATs), and a remainder greater than $0 and prohibit decreasing annuity payments; to modify rules on valuation discounts for family-controlled entities; make permanent portability rules, and require consistency in value for transfer and income tax purposes.

Income tax proposals pending include rules to limit the value of itemized deductions; from the highest scheduled tax rate of 39.6% next year to 28% for taxpayers in higher tax brackets, and extend the Bush tax cuts, except for high income taxpayers, and proposals to tax capital gains and dividends of high income taxpayers at 20%.