Fee-only planners discuss the application and limitations of technology

By Alexandra Baig

We use technology to provide effective service and support to our clients. Below, my fellow planners share how their firms use technology, how the technology benefits their clients and staff, how their use of technology is evolving, and what technology they hope will emerge.

What are the key elements of your technology stack?

Every advisor who weighed in on this question listed, at a minimum, financial planning software and customer relationship management (CRM) software. Those who manage money listed portfolio management and risk analysis software as well. A number of advisors use project management or project flow software, tax analysis software, and secure systems for sharing documents. And everyone placed value on communication tools ranging from basic email—for those whose practices skewed toward older, retired clients—to text and Loom^® videos for those whose client base skewed younger.

Specialty software might be necessary, too. I rely on MaxiFi Planner^® for detailed analysis of Social Security benefits to support my main client group, which is families with children or adults with disabilities.

All respondents noted that their technology “stack” evolved over time. Some advisors upgraded the technology they started with, while others found that they needed more complex tools as their practice grew and could afford the additional expense.

Elliot Dole of Buckingham Strategic Wealth believes that technology is very important, but also that managing and evaluating technology requires scale: “The landscape of wealth management technology is evolving quickly. As an advisor, that keeps me tied to a firm with scale. How does an advisor vet advisory tools and still serve clients? It takes a team of advisors just to use a suite of tools in support of advising clients.”

What technology advice would you give to advisors who are just getting started?

“I just launched my firm in November, and one of the core foci I pride myself on is having a tech-centric offering,” offered Nick Covyeau of Swell Financial. “I used to work in fine dining (throughout college), and the idea of the presentation is everything; anticipating your clients’ unthought of needs really struck me. Therefore, as I was designing the user experience and tech stack for Swell Financial, I really tried to put myself in the clients’ shoes and think through how I can make this process as engaging (and also easy) as possible for them.”

Kay Dee Cole of Clarity Wealth Development said, “My number one piece of advice would be to understand first what they want the technology to do. What is it that you need to solve? Prioritize those needs. Stay away from ‘shiny objects,’” she concluded, referring to complicated technology bought for its own sake.

Kelsey Brennan of Perennial Advisor Group had similar advice: “Spend time doing independent research on potential new products. Spend time looking through peer forums and getting the opinions of others who already use that particular product. Product demos always look and sound great, but the reality can end up being very different once you get into the details. Ask yourself questions such as: How will this benefit my clients? How will this integrate with the technology that I already have? How will this be useful in x, y, z scenario? Come to the demo prepared with specific questions and get as much info as you can.”

Mark Wilson of MILE Wealth Management had a different take: “Choose your CRM carefully (this is the hardest tool to change later), then go out and build your business. Spending time in the early years perfecting your tech stack is less valuable than finding clients. Play with the rest of the tools to see what works best for you and your clients.”

How much does strong technology integration increase your effectiveness?

Respondents differed greatly on this topic, starting with their opinion on whether existing technology does, in fact, integrate well. Tricia Rosen of Access Financial Planning said, “I rely heavily on software integration in order to be more efficient, and it is a key factor in how I evaluate technology and whether it is worthwhile for me.” Weinstein said, “We have had Redtail, AssetBook, and MGP integrated together since 2008. Hard to believe other firms still do not have full integration!”

Other advisors felt that technology hasn’t reached the level of integration they need. Cole said: “We would love to have one place to go to access all our software. But companies cannot do everything well—they need to concentrate on what they do best. I would rather have 10 logins … than one company login that does some things well but not everything.”

Wilson had even stronger feelings in this regard: “There is no strong technology integration today. Five clicks to move (say) a name and birthdate is not making advisors’ life any easier.”

What technology do you find most useful?

Cole said, “The most helpful technology is our CRM—we couldn’t service clients well without a centralized place that our staff can use to keep track of meetings, notes, calls, and tasks.” She added that the most useful technology is “for things that repeat over and over: scheduling appointments and tracking clients’ needs and related tasks.”

Wilson feels that iRebal, TD Ameritrade’s in-house portfolio creation and management platform, is his most useful tool because “it helps me build/manage proactively rebalanced, tax-aware, asset-located portfolios.”

All respondents included their financial planning software, and most listed their CRM as most useful. Several mentioned practice management or communication and media tech, such as Zoom and Loom, the latter of which supports the creation and dissemination of asynchronous short video messages.

What technology do your clients find most useful?

Covyeau said it’s all about convenience. “Your business today needs to be able to provide a service that can interface well with a smartphone. Everything from checking out your website, setting the initial appointment, to signing paperwork needs to be easy, simple, and seamless ... all available from your smartphone.”

Other advisors mentioned their website and DocuSign. Because I work with clients around the country. Zoom is an invaluable tool for the “face to face” interaction that’s so critical for my activities.

How do you integrate the “graphs, charts, and columns” output of your financial planning and investment management with a narrative that is easily accessible to clients?

Wilson goes the route of cut-and-paste from planning and portfolio management tools. Rosen would like to integrate more effectively: “I am going to take some pieces of eMoney reports, pieces of Holistiplan reports, pieces of Orion reports and try to make an informative and client-friendly report.”

Brennan sees the integration as a process of careful curation: “I think integrating graphs/charts into client deliverables and reports is absolutely necessary, but it does not need to be overdone. A lot of graphs/charts have too much going on, and they are not properly labeled. Either that, or they will be thrown into a report without much context. Things like this leave clients with a sense of ‘what am I looking at,’ which is the opposite of what we want. I like to make sure any graphs or charts are accompanied by a description or summary of some sort, and I want it to be concise. I do not want our clients to have to jump through hoops to figure out what a report is trying to tell them.”

Ken Weingarten, a managing financial planner at Weingarten  Associates, adds narrative to provide context for the report coming out of MoneyGuidePro.

Jamie Milne of Milne Financial Planning said, “Basically, we do not integrate, it takes too much time. We use mind maps for presentation and handwritten notes on key pages of canned reporting.” Cole finds that the graphs and charts are not necessary for her plan discussions with clients: “We don’t print out or concentrate on graphs, charts, etc., but clients can access them through our portal if they want—few do.”

Is there a kind of technology or software that does not yet exist that you feel could improve your financial planning process? 

This question generated some strong and creative responses. Covyeau said, “It bothers me that it still takes five-plus apps/tech vendors for me to do my job and deliver an amazing final result to my client, but I believe that space is getting better and eventually we will have a fintech platform that can be a single stop for clients and advisors.”

Rosen is hoping for “a summary to send to clients of how they are doing and what the to-do list is for them and for me that can easily be updated monthly, or at least quarterly. Sort of a one-page financial plan and to-do list mash-up.”

Weingarten wants “a true client portal that incorporates the multiple portals our clients need to access: Sharefile (for stored/shared documents), investments, financial plan.”

Wilson said, “I’d like to see fully integrated tax planning software that grabs data from checking and credit card accounts, custodians, and pay stubs to run ongoing tax projections and recommendations.”

For myself, I would like to find a single financial planning software that can model the complexity of planning for multiple generations, particularly when someone in the family has complex needs that require creative solutions. For example, I would like to be able to create a life plan for the family member with a disability that can directly drive a calculation of the amount of life insurance or inheritance it would take to fund a special needs trust to fully support that life plan.

After this discussion with respondents, I can say that every advisor who shared on this important topic engages fully with the technology they use, and they look at it through the lens of what will best serve clients. We have a certain level of appreciation for—and satisfaction with—the technology currently on offer, but we also have ambitious desires for its further creative evolution.

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Alexandra Baig (alexandra@companionsonyourjourney.com) has an MBA from the University of Michigan, her Certified Financial Planner^® designation, and practical, professional experience in both finance and disability support. She focuses her practice on people with disabilities and their families, helping them to maximize public and private resources to underwrite a quality life.

image credit: istock.com/metamorworks