Technological advance has often been seen and presented as a great threat to the advice profession.
The prospect of being replaced by robots is a frightening one, and digital wealth planning tools such as Nutmeg present a challenge to the status quo.
People can equip themselves with an ever-growing armoury of apps, robo-advice and machine-learning, and feel empowered as a result. If these advances are taken advantage of, over time financial services becomes more accessible and less shrouded in mystery.
I’d argue this is a wholly positive challenge for advisers and planners. Technological advances provide the opportunity to connect with clients in new and exciting ways. Rather than digging our heels in, let’s embrace the change, modernise and add value to our service.
Don’t think of it as you versus technology. It doesn’t have to be either or. After all, humans invented machines - let’s harness them to develop our business and provide massive improvements in the service we offer to clients.
With technology, you can reach existing and potential clients through so many different mediums: social media, apps, online content, and educational platforms. If you’re creative, the possibilities are endless when it comes to engaging with your clients. Don’t get left behind.
Access to advice and information
Financial planning should be a central part of all of our lives. The earlier we get to grips with it, the better.
Yet advice has so often been seen as the preserve of the wealthy, or something you put off until you’re older and need to sort out your pension.
By making financial planning more accessible, connecting with clients at an earlier stage, and by using not resisting technology, you’ll actually stay relevant.
This takes great confidence and security in the value of your expertise in delivering human financial advice.
The survival of your role does not, and must not, depend on keeping your clients in the dark - wholly dependent on you for advice in a world that is far too confusing to fathom going alone.
The fact is, this extra education and information is out there. If you don’t take steps to empower your clients with it, they can get it elsewhere. Clients may start wondering: “Why am I being kept in the dark? I’m not sure about these fees. Am I being taken advantage of?”
People are more independent now. People want to understand exactly where and how their money is being spent.
Give them this information. Involve them in the planning process and trust that this is not a threat to your expertise.
By empowering clients, you may reduce their dependence on you. But you’ll strengthen your client relationships in the long-run.
More and more, clients will begin to employ you because they want you, and because they fully understand the value of your expert advice.
The relationship should become more collaborative. The less understanding that clients have, the less ownership they can take over their financial future, and the more reliant they are on you to do the work and dictate the plan.
This may continue to work for a number of clients, but I have a strong hunch that clients will increasingly want to understand and be involved. I say, great!
When talking about creating mission statements within business, Stephen Covey says: “No involvement, no commitment.”
We can apply this logic to the financial planning process. By involving clients in the mission from the very outset, you’ll get far greater commitment from them, and a greater investment in the relationship.
Dr Eric Berne’s 'transactional analysis' theory talks about moving from a parent – child to an adult – adult relationship.
Berne said we all have the capacity to think, feel and act from three ego states: parent, adult and child.
The 'parent' state involves behaviours, thoughts or feelings copied from parents or authoritative figures.
The 'adult' state involves behaviours, thoughts and feelings that are direct responses to the here and now. Meanwhile the 'child' state involves behaviours, thoughts and feelings replayed from childhood.
While both the parent and child states are emotional, the adult state is rational, present and objective.
The adult - adult relationship is unemotional, rational, equal, wholly practical and solution-orientated. It’s clear this dynamic is healthier for a long-term relationship.
So yes, technological advances can seem scary. But there's the opportunity to turn that fear into excitement, and to harness technology to reach a wider audience, strengthen your client relationships and achieve better outcomes.
Robo-advice will never replace the human element at the core of what you do. Through synergy with rather than resistance to technology, you can create a service that truly works for your changing clients.