Financial services technology, more recently known as fintech, is a frightening prospect for many traditional financial planners. Why? Fintech represents a new leap forward in the industry that many planners are uncomfortable with.
However, we must evolve as an industry if we do not want to go extinct. Those who view technology as a threat are most likely the ones who have fallen into the trap of becoming salespeople rather than advisors. True advisors know that they can never be replaced by tech because the value they give their clients is so much more than just a stock pick or a new investing strategy.
Do you have what it takes to incorporate technology into your entrepreneurial advisory business? Embracing fintech is not just for the Millennials entering the industry. It’s for the veterans, too! Here are a few reasons why. (For related reading, see: 5 Financial Planning Decisions You Won't Regret.)
Fintech Gives You Flexibility
How cool would it be to advise your clients from a beach in Hawaii? Or from your son’s out-of-state basketball tournament? Technology gives planners the options to have a flexible life. While some planners may still prefer to work 9-to-5 in a stuffy office every day, many of us flourish in environments that are more conducive to our lifestyles.
When you have flexibility, you have more opportunities to serve. When your clients have a question after hours or when you’re out of town for the weekend, you don’t need to pass them on to an assistant or a different advisor. You can personally consult them from wherever you might be, giving them the one-on-one care that most clients truly appreciate.
Fintech Offers New Ways to Serve
Fintech can enhance the way you serve your clients while providing tools that make the daily ins and outs of a financial planner’s job easier. For clients we suggest they use the app YNAB. Our clients love it. It allows them to set budgets and helps them stay true to those budgets. They also have perks for financial planners who recommend their software to clients.
Any software that can help our clients capture spending activity and can bring awareness to spending habits makes our job easier when addressing spending issues. Aggregation tools such as eMoney help clients aggregate their account information to one place, providing a more holistic view. Riskalyze helps access risk tolerance and how clients’ investment portfolios compare to their risk tolerance. These are just a few of the fintech companies we use. We’ve been able to provide a more rounded service to clients by giving them helpful, useful, and educational tools to use. This allows us to focus more on the counseling we provide.
Fintech Enables You to Be a Financial Caregiver
Want to avoid disruption in your financial planning business? Then you may want to consider changing your mindset from one of a stock picker to one of a caregiver. When we start seeing ourselves as mentors and counselors, we are able to advise our clients not just about financial matters but about all life-enhancing subjects. When you can present your clients with more options and information, you increase your value.
Imagine being able to walk your clients through the new technology that can make their lives better. Not only will this help them integrate it into their lives, but they’ll also view you as the mentor who helped them learn it. This is what being a financial caregiver is all about—making our clients’ lives better in any way we can.
The financial world is evolving quickly, and technology will be the backbone upon which its built. To evolve, we must see the industry and our place in it differently. Embrace fintech as a way to serve and be of value to your clients and you will avoid the disruption that many of your counterparts will inevitably experience. (For related reading, see: Does Your Advisor Have an Exit Strategy?)