XY Planning Network on the hunt for innovative financial adviser technology for young clients

XY Planning Network, the organization of advisers serving Gen X and Gen Y clients, is searching for new software vendors to address the financial planning issues of young clients.

In an attempt to find these innovators, the group, which has about 250 advisory firm members, has launched its first FinTech competition for startups tackling the problems younger generations face, such as student loans. Submissions will be accepted until July 15, and the top six applicants will be invited to introduce and demonstrate their software at XY Planning Network’s annual conference in September, during a session hosted by Bill Winterberg, founder of FPPad, a financial technology consulting and news hub.

“We can’t find good technology solutions for some of the problems we are facing,” said Michael Kitces, co-founder of XY Planning Network. “If we can’t find the technology solutions because they’re not out there yet, the next best thing is to create an environment to build the solutions.”

Though there are many vendors targeting financial advisers, young planners say they are generally geared toward retirement and could do a better job at supporting the clients with student loans or lack of financial literacy in credit and insurance management. There has been an emphasis on investment management, particularly for small accounts, as robo-advisers have entered the business-to-business market, but there can be more innovation, they say.


The traditional definition of retirement is also changing, said Matt Cosgriff, a financial adviser at Lifewise powered by BerganKDV in Minneapolis, Minn.

“Millennials are redefining what retirement is and what it means, and I don’t think software currently supports the non-traditional retirement,” he said, adding that some clients may choose to work hard for 20 years and then go part-time or pursue their passions, as opposed to working until they’re in their 60’s.

One of the biggest issues technology could support advisers in is student loans, which has risen to nearly $1.3 trillion in the country. Mr. Kitces said student loans can be so complex, but there aren’t any programs designed for it.

Other aspects of millennial clients’ finances that advisers could support with more technology options include career coaching, cash flow and debt management, credit card management and insurance and investment coaching, said Austin Lewis, founder of Rooted Financial Planning in Fort Worth, Texas. He said he would like to see a software provider develop a platform specifically for millennials.

Having these tools created before the $30 trillion wealth transfer expected to occur in the next three decades would be especially helpful, he said.

Mr. Winterberg said he hopes to see smart use of account aggregation to drive better decision-making, as well as new ways to present financial plans and collaborate between clients and advisers. “There are always opportunities in the fintech landscape,” he said.

There is plenty of innovation going on in the financial technology world, though, said Joel Bruckenstein, co-founder of the Technology Tools for Today conference, which hosts industry software vendors every year. He said vendors and custodians are all moving in that direction, though perhaps not as quickly as XYPN would like. The organization will be a catalyst to accelerate that change, however, he said.

“[XYPN] is advocating for their clients, which are relatively a small portion of the total adviser client population,” Mr. Bruckenstein said. “Every day that portion is growing and as it grows, you build momentum.”