Softer side of wealth management will prevail in the future

As technology turns investment management into a commodity, advisers need to find better ways to add value

May 9, 2019 @ 3:30 pm

By Jeff Benjamin

The future of financial planning is leaning toward the softer side of wealth management, according to a panel of industry executives speaking Thursday at the Carson Excell conference in Chicago.

"The kinds of people who are great at developing relationships are the type of people we need in financial services," said Tom Nally, president of TD Ameritrade Institutional

He added that when advisers are looking for new hires, they should look past the finance majors to focus on people studying psychology and humanities.

David Canter, head of the RIA segment at Fidelity Clearing & Custody Solutions, cited examples of advisory firms creating positions such as "director of first impressions" and "chief culture officer."

"That's the next frontier," Mr. Canter said. "We all know it's tough to differentiate."

The general message from the panel was as consolidation continues and firms pursue scale, technology is turning investment management into a commodity, and advisers need to find better ways to add value.

"Advisers are giving away for free what they should be charging for and they're charging fees on what they should be giving away for free," said Sterling Shea, global head of wealth and asset management at Dow Jones.

The good news for advisers is that technology isn't expected to eliminate the need for human advisory services.

"Technology won't replace the financial adviser, but it does give the client a much richer experience," said Ron Carson, founder and chief executive of Carson Group, the conference host.

Despite the fears about digital platforms replacing human advisers, Mr. Nally said the demand for human advice will continue to grow.

"I think more people will have a human financial adviser in the future," he said. "People want that engagement."

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