Is Your Adviser Using Fintech To Better Serve You, or a Larger Roster of Clients?

Smart use of technology can free up your adviser to do more for you. From enhanced communication to personalized updates and coaching, be sure to get what you're paying for.

By Matthew C. Peck, CFP®, Certified Investment Management Analyst

published 14 April 2020

in Features

Over the past several years, we’ve seen breakthroughs in technology change almost every aspect of our lives — from how we shop, to how we get our news and entertainment, to how we get directions. Even how we ask for a ride.

When It Comes to Retirement, Look for a Plan, not a Pitch

These types of innovations are impacting the financial planning industry as well.

More and more advisers are turning to sophisticated software programs to organize and analyze client data, allowing these advisers to work more efficiently and increase their productivity.

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But what does it mean for their clients? If your adviser is no longer performing some of the most cumbersome parts of the job, such as portfolio building and regular rebalancing, is he or she using that freed up time to better serve you … or a larger roster of clients?

That’s an important question given the rise in robo-advising options, which tend to cost less than traditional advisers. Robo-adviser fees typically range from free to about 0.75% of assets under management per year, depending on the size of an account and the services provided. Fee-based traditional advisers generally charge 1% to 1.5%. If you’re paying more for professional help, you should be getting more for your money.

Here are some things your financial adviser should be able and willing to provide:

More communication

Your fintech-savvy adviser should be a master of communication — through individual emails, email blasts, phone calls, texts, newsletters or maybe even a blog or video messaging. Choose the format or formats that are most comfortable for you, and let your adviser know you expect to hear something on a regular basis. If you want more frequent contact when the market seems especially volatile, make that clear. And be sure there’s room on the calendar for an occasional face-to-face meeting as well.

More personalized updates

Your adviser should know about you and your family and be prepared to discuss relevant issues as they come up. That might mean proactive age-related conversations about how you’re going to pay for kids’ college expenses, maximizing your Social Security benefits, or what moving your spouse to a nursing home could require. Or it may mean discussing a new law or rule change that could affect your savings, income or retirement plan. Did your adviser contact you about the tax reforms included in the Tax Cuts and Jobs Act of 2017 and what they might mean to you? Did he or she notify you about how the new SECURE Act could affect how you contribute to, withdraw from, or inherit a tax-deferred retirement account? Your adviser should be prepared to explain the ins and outs of what’s happening in the news as it relates to your concerns.

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More coaching

It’s one thing for your adviser to ask about your goals; it’s another to get knowledgeable advice on how to realize those objectives. This means talking about more than investments. It could include working on paying down debt, looking at the best life insurance options, or deciding how much house you can afford (or whether you should stick to renting). And if investing is your focus, your adviser should be ready to explain the different phases of retirement planning and how to successfully transition from accumulation to protection and distribution. Many advisers offer comprehensive planning — touching on taxes, estate planning, income planning and more. But now, thanks to fintech, more financial professionals should have time to go even deeper into those topics.

More emotional support

Having a financial adviser who understands what motivates you or, conversely, what makes you uneasy, can be a huge plus. Mistakes are frequently made in the heat of the moment, when an investor overreacts to a “hot tip,” a scary headline or some crazy movement in the market. Which is why an adviser’s job is often as much about managing emotions as it is about managing money.

These are things a robo-adviser can’t offer.

The key word here is “more.” Thoughtful use of fintech allows human advisers to build on their relationships with clients, adding more value to the work they do. Make sure your adviser is committed to using time-saving tech tools in a way that truly benefits you.

Need Financial Advice? How to Choose Between Robo and Human Help

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

Kim Franke-Folstad contributed to this article.

Disclaimer

Investment Advisory Services are offered through SHP Wealth Management LLC, an SEC registered investment adviser. Insurance sales are offered through SHP Financial, LLC. These are separate entities, Matthew Chapman Peck, CFP®, CIMA®, Derek Louis Gregoire, and Keith Winslow Ellis Jr. are independent licensed insurance agents, and Owners/Partners of an insurance agency, SHP Financial, LLC. In addition, other supervised persons of SHP Wealth Management, LLC are independent licensed insurance agents of SHP Financial, LLC. No statements made shall constitute tax, legal or accounting advice. You should consult your own legal or tax professional before investing. Both SHP Wealth Management, LLC and SHP Financial, LLC will offer clients advice and/or products from each entity. No client is under any obligation to purchase any insurance product. SHP Financial utilizes third-party marketing and public relation firms to assist in securing media appearances, for securing interviews, to provide suggested content for radio, for article placements, and other supporting services.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Matthew C. Peck has his Certified Financial Planner and Certified Investment Management Analyst certifications and is co-founder of SHP Financial. He is insurance licensed and has passed the Series 65 exam.