Providing seamless digital experiences will help clients succeed in the long term

Over the past year, we’ve seen what happens when you give consumers great technology without great advice. Robinhood and similar sites have helped democratize investing with innovative technology. But when gamified investing isn’t paired with proper advice, outcomes for many investors can be disastrous.

Advisers who provide a seamless digital experience with professional advice are in a strong position to remain profitable and help their clients succeed in the long term.

Today’s clients enjoy being able to schedule appointments via Zoom, in-person, or over the phone; obtain actionable next steps on financial matters; and receive answers to their questions online — while also being seamlessly connected to their adviser when they want to discuss something in more detail. Advisers who can deliver a dynamic digital experience with solid advice, at scale, through technology platforms and engagement tools are the ones who will outpace their peers in the next five to 10 years.

SINGLE VIEW OF A CLIENT’S ENTIRE FINANCIAL LIFE

Modern consumers expect things to be done their way, with as few clicks and logins as possible. To that end, clients should be able to log into one portal where they can obtain a holistic view of their full financial picture. This profile should encompass not just short-term spending and long-term investing, but also credit, insurance, health care spending and other aspects of a client’s financial life.

Change is constant, especially now, when we’re two years into the pandemic and experiencing intense geopolitical volatility. Did a client lose their job? Get a raise? Have they begun decumulation? Welcomed a new baby? Did Covid cause them to look for a new home, or alter their life, family, or professional goals? Do they now expect to have to work during retirement? Will they be able to meet their expenses amid rising food and energy costs?

And how does what they spend affect what they will be able to save?

Wherever clients are in their financial journey, the holistic financial profiles they can access via digital portals need to reflect what’s happening in their lives. The capability to harness consumer data from thousands of sources allows advisers to support clients with data-driven recommendations on specific actions to take at every point — as they go from working to retirement, or from retail to ultra-high-net-worth investors — without forcing them to reenter data, log into different profiles or lose functionality.

WHAT DATA CAN TELL CLIENTS

If a client says, “I know how much my paycheck is, but I need help understanding how much I’m spending every month,” they should be able to log into their digital profile, view what they spend every month, and compare that to average monthly expenses in their peer group.

In addition to showing clients how they stack up against their peers, advi`sers’ digital portals should be able to tell clients what to do with every dollar coming into or out of an account. Data-driven insights can recommend the best place to invest money coming in, or the best way to use that money to pay off debt — and whether clients should take out a loan to pay that debt instead of using money from an account. If a client needs to make a withdrawal to pay expenses, data-driven insights can model the consequences of making such a withdrawal and suggest a better source for the money.

This type of data allows advisers not only to analyze a client’s current financial picture, but also look into the future. Based on recurrence patterns and spending analysis, advisers can determine if a client will have enough cash to pay their property taxes, or if they should hold on reinvesting their latest dividends so they won’t have to sell securities for a gain in three weeks when they are due.

Smart digital engagement tools can alert clients to what actions they should take regarding monthly spending when they most need them — such as when they are about to buy a new car, when they stop to fill up with gas, or when they’re walking out of Costco after having spent $300.

ACCESSIBILITY FROM ANY DEVICE

Logging into multiple devices can be annoying. If advisers can receive requests to open accounts or sign paperwork on their smartphone or iPad, but can only complete these actions by logging into their desktop, imagine the aggravation their clients go through.

Siloed technology disrupts what should be a seamless and meaningful experience. To add as much value for both the adviser and client as possible, the single-view, holistic profile of a client’s entire financial life should be accessible on whatever system or device they prefer.

An adviser’s technology platform should let them run all operations through their central relationship management systems, for example, if that’s best for their business. And it should allow both the adviser and client to securely access data and conduct business, without interruption, from a desktop or any mobile device.

API-ENABLED INTELLIGENT FINANCIAL LIFE

Using an open-access financial services/wealth management technology ecosystem, advisers and their fintech developers can pick and choose from a broad spectrum of components — such as data from third-party providers, or exchanges offering access to alternative investment, insurance, or credit products — to include in their digital client experiences. They can roll out the customized digital experience they offer with these components, including uninterrupted single-sign-on access from any device, through application programming interfaces.

APIs offer a faster and cheaper way to strengthen the digital client experience and broaden access to data and investment products, than purchasing new software and switching from legacy systems. They make it easy to create more efficient workflows and outsource more portfolio management, investment management, and trading tasks, at a lower cost — giving advisers more time to spend engaging with clients. And with demand for alternative investments, especially cryptocurrencies, only continuing to increase, APIs can make it easier for advisers to provide clients with seamless access to crypto assets.

ENTER THE CYBORG ADVISER

The ongoing technology development and innovation trends in wealth management can provide advisers with the phenomenal technology and open access to deliver solid, personalized advice within a dynamic digital experience for end investors. The seamless connectivity between human advice and scalable technology is the experience that best positions advisers to help improve outcomes for clients.

Going forward, technology and innovation in the wealth management industry will continue to empower advisers to help consumers understand the impact of what they spend today on what they save tomorrow — and do so how and where they want to engage.

Brandon Rembe is chief product officer of Envestnet.

Related Topics: Envestnet