Reinventing Wealth Management with Technology
It's important to embrace leading-edge solutions in financial planning
I find it hard to recall a time when I didn’t google, send a text message or even deposit a check without leaving my office. The last two decades have generated innumerable technological innovations that have enhanced our daily lives, not to mention the way many companies conduct business.
Industries across the globe scrupulously try to understand if and how any of these new tools and devices can improve operations. Will the cloud help streamline processes? The internet of everything is seemingly everywhere—should we care and how? Some companies instantly jump on the bandwagon and embrace new technologies, while others take time to shift company culture, change perception and adjust operations and processes.
Regardless of which side you’re on at the moment—jumping in blindly or testing the waters, it is important to, at the very least, identify and understand all the new tools entering the marketplace. With mobility trends continuously on the rise and client expectations evolving, companies have no choice but to change the way they run their businesses.
As a wealth manager, I have seen a number of new products enter the financial realm over the past decade—from financial planning software and Client Relationship Manager (CRM) programs to account aggregation, document management tools and mobile apps. And while our industry, as a whole, has embraced the concept of emerging technologies, we still have a long way to go to shift antiquated perceptions and ensure many financial advisors and wealth managers are implementing new solutions. Not only can these tools enable us to service our clients better, but they can also significantly improve our operations and make our jobs easier and more efficient. In fact, findings from a recent Fidelity survey showed that one-third of investors would switch advisors if they weren’t active technology users.
While different industry professionals will continue to ask questions about which technology to use and how, I put together a few reasons as to why:
Efficiency Automation technology offers speed and accessibility, helping advisors access data and communicate with clients at any time and from any location. Not only can it help advisors stay organized and on top of their workload and client needs, but it also frees up their time. Similarly, CRM enables advisors to more effectively and efficiently manage their practice by streamlining tasks and managing client information, while various financial planning software eliminate redundant manual processes, such as having to re-enter client information into separate systems.
Connect with Clients With technology handling many of the jobs we used to do manually, we have more time to take on a wider range of clients and spend more time with them, building relationships with existing clients and seeking out new business. For instance, much of investment management can be implemented with technology these days. We no longer need to sit behind a computer screen and enter trades all day. We can focus on comprehensive planning and working with our clients face to face. Additionally, with so many next generation investors already expecting us to have the latest tools and communication methods, it’s to our advantage to showcase our expertise in these tools and connect with clients in a preferred matter—with some even via text messaging. This all adds up to a better customer experience and improved client service—and in a crowded space, that personal touch can make a world of a difference in your business.
Mitigate Risk We’ve all seen the rapid cloud progression—with businesses moving to the cloud to streamline operations, lower cost, improve service levels and, of course, security. As we embrace new technologies, we access tools that protect client information, which is critical in our business. No longer do we need to have drawers full paperwork and confidential documents stored on local computers—we can take advantage of secured infrastructures and still have access to data 24/7. Financial planning software can also minimize entry errors—instead of performing financial planning and analysis manually on an excel spreadsheet, we can use new programs and reduce the potential for error.
In addition to the benefits listed above, the use of emerging technologies can be a major differentiator for your business. Clients expect us to be forward-thinking. Embracing new technologies, including instant communication methods, shows them we are on the forefront of our industry.
Our job is to service clients and offer sophisticated solutions to improve their financial well-being, helping them sleep better at night. Many new tools exist to help us become more efficient, effective, and accessible, creating a better experience for our clients. At the end of the day, the ROI gained from happy clients (and their immediate families, friends and colleagues) can far outweigh the costs in researching and implementing the new technologies.
Taylor Schulte, CFP® is founder and CEO of Define Financial, a San Diego-based fee-only firm. He is passionate about helping clients accumulate wealth and plan for retirement.
About the Author
Founder and CEO, Define Financial
Taylor Schulte, CFP®, is founder and CEO of Define Financial, a fee-only wealth management firm in San Diego. In addition, Schulte hosts The Stay Wealthy Retirement Podcast, teaching people how to reduce taxes, invest smarter, and make work optional. He has been recognized as a top 40 Under 40 adviser by InvestmentNews and one of the top 100 most influential advisers by Investopedia.