Advisor360° has released its inaugural 2022 Connected Wealth Report, which asked 300 financial advisors and executives across the U.S. for their perspective on the role that their technology plays in helping facilitate their business.
The wealth management industry is evolving rapidly, forcing firms to upgrade legacy technology to remain competitive. Firms need technology that enables advisors to build lasting connections with clients and secure new business.
Our analysis of the responses provided by advisors and executives from a wide range of firms revealed three themes that can help us understand the current state of technology in wealth management.
1. Current wealth technology has gaps
Subpar technology is costing advisors business. Today’s clients, especially from the millennial and Gen Z generations, expect to work with their advisors using modern technology like the seamless, online engagement they enjoy in other areas of their lives. Advisors report that they are losing current and prospective clients because their wealth management technology did not meet expectations. With referrals as a primary source of new business, it is more important than ever for advisors to build trust through strong connections.
What was the percentage change in your inflow of new client assets under management in the last financial year?
Tech is at least mostly modern (2018+)
Among advisors who report a 6%+ increase in inflow of new client assets under management in the last financial year.
Tech is in need of an upgrade (2002-2017)
Among advisors who said they had a 1%+ increase in inflow of new client assets under management in the last financial year.
Fig 1.1: Client growth based on technology
2. Advisors seek to stay connected with clients
Many advisors view technology as an extension of their practice, so newer capabilities and innovations could have a significant impact on how they engage with clients in the future. Texting has been transformational for advisors—and they believe digital onboarding could be, as well. Advisors know they need to communicate well with clients of all ages and need tools to help them drive collaboration across generations.
Which of the following do you believe would dramatically impact the way you work with clients?
Fig 2.3: Impact of digital onboarding in the way advisors work with clients and Fig 2.4: Impact of secure texting or direct messaging in the way advisors work with clients
3. Advisors need workflow improvements to be more productive
Advisors’ biggest gripe about their existing platforms is the lack of automation. Account aggregation, integrated tools, and seamless reporting would allow advisors to be more efficient and focus on expanding relationships with clients.
What are the key challenges you face with your existing technology setup?
Fig 3.4: Key challenges advisors face with their technology setup
Read the 2022 Connected Wealth Report and explore the biggest technology challenges around new client relationships, client collaboration, and advisor productivity, and see where others are finding solutions.