How does an industry that relies so heavily on in-person meetings continue to succeed in a world abruptly overturned by a global pandemic? With so much of their ability to foster relationships and build trust done face-to-face, many financial services professionals had to quickly shift the way they interact with clients, prospects, and partners last year. Making matters worse, they were required to make this transformation while also managing a significant uptick in inquiries from prospects.
These challenges have spurred growth and innovation within our industry, accelerated the innovation and adoption of new technologies, and emphasized the value of both financial professionals and comprehensive planning. Many may view 2020 as a year to forget, but there are still lessons that can be learned as we continue to move forward.
The financial advisors who rely on our technology offerings experienced challenges—and opportunities—in four key areas last year.
Financial planning should be less about trying to precisely predict the future, and more about being prepared for the unpredictable. With volatile markets and changes to everyday life, the demand among investors for improving financial preparedness quickly increased.
Unsurprisingly, many advisors worked with clients to review existing strategies to see what impact the pandemic might have on their financial goals, and adjust them accordingly. A CFP Board study released in April 2020 found that 78 percent of Certified Financial Planner™ (CFP®)-designated professionals reported an increase in client inquires during the pandemic.
To help address those client concerns and keep their businesses operational, advisors turned to remote client connection tools—something we can expect to continue as part of the new normal. Tools like an interactive client portal and engaging plan presentation capabilities can make a significant impact on the delivery of advice in the post-pandemic world.
Current clients were not the only ones looking to improve their financial situations; the same CFP Board study found that 34 percent of advisors reported an increase in inquiries from prospects.
Investors are often reactive when it comes to seeking financial advice, which many advisors understand can become a challenge when trying to put a plan together. If anything, one benefit of the events of last year is that more individuals and families now realize the importance of having a comprehensive financial plan, and understand how certain events can affect their financial health.
An increase in prospective clients is certainly exciting, but many advisors had to juggle their time between managing their firms’ shifting operations and continuing to serve current clients, while at the same time onboarding an influx of new ones. Many firms turned to technologies to help expedite the process of onboarding new clients, and demonstrate more value for prospects. For the latter, smart data-gathering tools and self-directed workflows gave advisors the power to create personalized plans for prospects with more accurate calculations about retirement income and expenses.
In addition to reducing onboarding time for new clients, firms can use the disruption of last year’s events as another opportunity to explore additional areas where efficiencies can be implemented.
Some might be worried that clearly defining workflows will lead to simplistic, cookie-cutter advice, but the result is usually quite the opposite. Defining your process and creating repeatable workflows across a practice frees up more time to focus on providing customized advice for each client’s unique needs. Additionally, developing a seamless planning process can make managing changes to financial plans far easier in all market conditions, whether they be an unprecedented shift like 2020 presented or much more common occurrences, such as shifting industry regulations.
Improve Yourself & Your Practice
While many advisors we service were stretched for time last year, some were able to utilize downtime at home to improve their practices and themselves along the way. The start of a new year often presents an opportune time to reassess practice marketing efforts, and with the demand for financial planning reaching new heights, it could be an incredibly valuable process. There are many options for firms to take their marketing to the next level—improving website design and engaging with clients and prospects via social media being a couple examples.
For advisors looking to earn continuing education credits, or those simply looking to further improve their skills, various online programs have become even more readily available as in-person conferences remain on hold. The temporary shift to digital conferences and industry roundtables allows advisors to continue to learn from and interact with each other, despite the inability to do so in-person—and sharing videos from these digital conferences on social media can help advisors demonstrate expertise and value for clients and prospects.
Though 2020 presented several challenges to our industry, it also brought some positive trends that will continue to advance financial planning services. As our industry evolves, wealth management firms of all sizes can adapt, and position themselves for a successful year ahead, with the help of cutting-edge technology solutions.