Written By Sal Esposito
Article From October 2009 edition of
The Beacon

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I have recently attended a number of financial planning conferences and in addition to finding fewer advisors attending the event I have also noted that the attendees in general have been a bit more eager to find the “killer app” or “product” that can turn their practice around. My advice is to look to the early adapters.

It is obvious that the last 12 months have been somewhat challenging for our industry and it is also evident that the turmoil will have a considerable effect on the business model. The way we interacted with our clients in the past is likely to change drastically. At this time, no one is quite sure how financial advice will be delivered in the future.

As in any industry, the market will look at early adapters of new practices and technologies to lead the way and define the shift and the new model.

In discussions with advisors that I would consider early adapters, I have found a significant willingness to include the client in the process and a renewed focus on the advice portion of their value proposition. These advisors have concluded that their clients are now demanding to take an active part in the planning and monitoring phase of their financial planning strategy.

They require immediate answers to simple questions.

Their clients are no longer willing to wait for the next meeting or a call back to discover the impact that a change in the inflation rate may or may not have on their retirement strategy. They want to feel in control of their financial strategy and in return, are willing to take ownership and share responsibility for the tactical strategies.

Clients are demanding assistance in steering the boat to keep it on course with sound and well-qualified advice. They are fully aware of the changing currents and are no longer willing to wait below deck until it is too late. They want to understand the risks and have an active role in finding ways to mitigate the impact on their financial future. They are eager to learn more.

The education component of their practice is now a crucial part of the advice. Client education is the basis of the new paradigm of client relationships. However, education must be delivered in a new dynamic format.

Pushing out static and dense educational material will no longer suffice. A visual and dynamic platform is required to suit the clientʼs hectic life style. Education will come with applied models. Practical education will outperform academic and theoretical models.

The early adapters in the industry are looking to change their practices by introducing new processes and technologies that allow their clients to have a hands-on approach to planning thus freeing them to focus on delivering education and advice that mitigate risk.

Change will come fast, and as always, a speedy adaption to the new model will be crucial to survival and growth.

Finance Logix – integrated features of our advisor & client portal

• Dynamic Financial Plan to facilitate client participation.
• Multi-client risk tolerance based on industry wide analysis and research.
• Investment analysis tools for client assessment and research.
• Aggregation of financial accounts with nightly refresh of client data.