In talking with many financial advisors and institutions over the years, groups have evolved at different rates in how they use technology in their practice. Some shun it completely beyond the bare minimum of portfolios and modeling. Some are excited about what technology can do and know they should be trying to do more digitally, but aren’t sure where to start. And there are some, albeit a smaller group, that have fully embraced a blended business of digital and in-person experiences.  

And beyond the traditional financial advisors and institutions, there are companies that have popped up in the last handful of years that are fully digital and, in many instances, driven not by people directly, but by machine learning or AI. These companies are often referred to as ‘robo advisors.’  

There’s no right answer for how and to what extent you should use technology in your own practice, but recent events have shown us that those who innovate and test new strategies now will be better equipped to handle shifts in the market later. 

Control and Stability 

Even amidst a pandemic, people are signing up for robo advisor services in droves. But what are people truly searching for? A way to manage their money? Sure. Though managing money is one piece of the puzzle, we believe that the reason people have flocked to advisor platforms is because they’re seeking a sense of stability and control in these uncertain times. What they’re really after, however, is comfort. A robo advisor has become a stand-in for a source of comfort and stability when people cannot leave their homes and have no existing relationship with a financial professional.  

In times of crisis, it’s not really the ‘money management’ that people are seeking, nor is this what they’re seeking in times of calm and prosperity. The best way for traditional financial advisors to hold their ground with the emergence of robo advisors is to embrace technology in a way that supports their underlying mission and provides a point of leverage for client support. 

Software +  Human Interaction  

Technology isn’t the competitor, it’s the secret weapon. Managing money might be something that can be automated but a person who has experience and compassion cannot be. Clients want to be soothed and reassured during significant life or world events and that’s not something that technology can provide on its own.  

Now is the time to seek out ways to integrate more technology in your daily practice. It’s an exercise in finding creative and relevant ways to stay connected to clients when you can’t meet with them in person. There’s never been a better time to test and iterate on ways you can use technology to improve your client experience for when things shift back to ‘normal.’  

Solutions such as Genivity are a great bridge between the in-person and digital experience. During this time of shelter-in-place or quarantine, advisors can use solutions such as our HALO assessment as a reason to reach out to clients and keep them engaged even while they’re not able to come to your office. This provides a way for advisors to stay top-of-mind with clients while also creating value for the client through their HALO assessment.  

You can then either use it as a talking point when you’re able to have an in-person meeting or you can expand your digital experience further by having a video call or conference with your clients. The human element of any experience has never been more valued than it is today, so your clients will likely welcome a personal interaction, even if it is remote.  

One Step at a Time 

Small steps such as this can make dealing with times of uncertainty easier and it can also set up action items for the next time you are able to meet in person. It’s not always about the money, it’s about what money provides your clients: comfort and stability. Nothing is more important than that in times like these.  

As the author Robert Greene is fond of saying, you can be in situations you can’t control, but what you can control is whether you use that situation as ‘alive time or dead time.’ Make this time of uncertainty ‘alive time’ for yourself and for your practice by researching new digital solutions and getting creative with how you can implement them with clients now and into the future.  

If you’re unsure about how you can best leverage technology for your financial practice, we’re available to chat. Simply book a consultation today and we can discuss the best ways to help you stabilize and grow your practice through digital solutions such as HALO.  

As a financial advisor you know that Social Security likely won’t cut it in the future. The political situation around the long-standing pool of money is anything but stable and the cost of living and healthcare keeps going up. This likely is a very real, very stressful aspect of retirement that your clients are facing— even for the affluent.

The most imposing part of this challenge is that most people who are approaching retirement age who have a retirement plan think they’re set up for their lifestyle into their retirement years. But one question that continues to go unanswered for many is, “how will I create lasting, sustainable income in retirement?”

Starting the Conversation

If you’re an advisor, you may recognize this but have clients who are convinced they will be ok and they don’t want to talk about it any further— especially when it involves their health.

One solution that many retirees have found is that they can take a part-time job or only partially retire to supplement their income. If your clients think they’ll be able to continue to work, it’s important to have the conversation about their health early, because chronic illness can derail otherwise solid planning.

What is Sustainable Income?

In an interview with Barrons, Nobel-prize winning economist William Sharpe tried to give some insight into what sustainable retirement income would look like. One of the more interesting strategies he illuminates is “buckets” of annuities and investment for each year of retirement instead of drawing a fixed percent from a single large investment.

However, he does warn that navigating a complex situation like retirement income might be more than the average retiree is willing to handle. This, obviously, is where you come in. There is no right or wrong way to handle the flow of money in retirement, except to make sure that there is enough to align with the desires of your clients.

Annuities and investments can be overwhelming even to financial advisors at times. Helping to create income retirement that your clients can count on is what they’re relying on you to do. Likewise, it’s what can make the difference between (hopefully) a relaxing and joyful retirement and a stressful, penny-pinching one.

It’s important to keep in mind that not every client will keep you on indefinitely either. They may seek your services only to help create their plan and then manage it on their own. While it’s never fun to lose a client, these people can help hone your skill set of creating lasting retirement income for future advisees.

Beyond Income

Discussing sustainable retirement income with clients can’t happen without a discussion about long-term care and health care costs. Michael Valdez, CFP®, AIF, CLU, from Synergy Wealth Alliance says that a conversation with clients about “wealth preservation is also about who they are and what they want to do with their life— their big-picture purpose.”

Valdez also believes that wealth preservation and retirement income comes down to early planning and leveraging available tax-advantaged funds. Rather than pulling from planned income to pay for long-term care or other health care expenses, early planning and asset reviews can ensure clients have a steady income for the entirety of their remaining lifespan.

There’s a lot of uncertainty in the world today, markets that go up must come down and any time your clients are reliant on government programs for income could spell trouble. Be aware of those clients that are approaching their retirement years and be sure to have a real, transparent conversation about how they plan to fund their retirement regardless of the uncertainties.