Over the past several years, we’ve seen breakthroughs in technology change almost every aspect of our lives — from how we shop, to how we get our news and entertainment, to how we get directions. Even how we ask for a ride.
These types of innovations are impacting the financial planning industry as well.
More and more advisers are turning to sophisticated software programs to organize and analyze client data, allowing these advisers to work more efficiently and increase their productivity.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
But what does it mean for their clients? If your adviser is no longer performing some of the most cumbersome parts of the job, such as portfolio building and regular rebalancing, is he or she using that freed up time to better serve you … or a larger roster of clients?
That’s an important question given the rise in robo-advising options, which tend to cost less than traditional advisers. Robo-adviser fees typically range from free to about 0.75% of assets under management per year, depending on the size of an account and the services provided. Fee-based traditional advisers generally charge 1% to 1.5%. If you’re paying more for professional help, you should be getting more for your money.
Here are some things your financial adviser should be able and willing to provide:
More communication
Your fintech-savvy adviser should be a master of communication — through individual emails, email blasts, phone calls, texts, newsletters or maybe even a blog or video messaging. Choose the format or formats that are most comfortable for you, and let your adviser know you expect to hear something on a regular basis. If you want more frequent contact when the market seems especially volatile, make that clear. And be sure there’s room on the calendar for an occasional face-to-face meeting as well.
More personalized updates
Your adviser should know about you and your family and be prepared to discuss relevant issues as they come up. That might mean proactive age-related conversations about how you’re going to pay for kids’ college expenses, maximizing your Social Security benefits, or what moving your spouse to a nursing home could require. Or it may mean discussing a new law or rule change that could affect your savings, income or retirement plan. Did your adviser contact you about the tax reforms included in the Tax Cuts and Jobs Act of 2017 and what they might mean to you? Did he or she notify you about how the new SECURE Act could affect how you contribute to, withdraw from, or inherit a tax-deferred retirement account? Your adviser should be prepared to explain the ins and outs of what’s happening in the news as it relates to your concerns.
More coaching
It’s one thing for your adviser to ask about your goals; it’s another to get knowledgeable advice on how to realize those objectives. This means talking about more than investments. It could include working on paying down debt, looking at the best life insurance options, or deciding how much house you can afford (or whether you should stick to renting). And if investing is your focus, your adviser should be ready to explain the different phases of retirement planning and how to successfully transition from accumulation to protection and distribution. Many advisers offer comprehensive planning — touching on taxes, estate planning, income planning and more. But now, thanks to fintech, more financial professionals should have time to go even deeper into those topics.
More emotional support
Having a financial adviser who understands what motivates you or, conversely, what makes you uneasy, can be a huge plus. Mistakes are frequently made in the heat of the moment, when an investor overreacts to a “hot tip,” a scary headline or some crazy movement in the market. Which is why an adviser’s job is often as much about managing emotions as it is about managing money.
These are things a robo-adviser can’t offer.
The key word here is “more.” Thoughtful use of fintech allows human advisers to build on their relationships with clients, adding more value to the work they do. Make sure your adviser is committed to using time-saving tech tools in a way that truly benefits you.
The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.
Kim Franke-Folstad contributed to this article.
Disclaimer
Investment Advisory Services are offered through SHP Wealth Management LLC, an SEC registered investment adviser. Insurance sales are offered through SHP Financial, LLC. These are separate entities, Matthew Chapman Peck, CFP®, CIMA®, Derek Louis Gregoire, and Keith Winslow Ellis Jr. are independent licensed insurance agents, and Owners/Partners of an insurance agency, SHP Financial, LLC. In addition, other supervised persons of SHP Wealth Management, LLC are independent licensed insurance agents of SHP Financial, LLC. No statements made shall constitute tax, legal or accounting advice. You should consult your own legal or tax professional before investing. Both SHP Wealth Management, LLC and SHP Financial, LLC will offer clients advice and/or products from each entity. No client is under any obligation to purchase any insurance product. SHP Financial utilizes third-party marketing and public relation firms to assist in securing media appearances, for securing interviews, to provide suggested content for radio, for article placements, and other supporting services.
-
Where to Retire: Living in Portugal as a US RetireeLiving in Portugal as a retirement landing spot has abundant advantages, but do your homework and due diligence first.
-
A Social Security Storm Is Gathering: Here's Your Safety PlanIf Social Security reserves are depleted by 2033, as predicted, future benefits could be cut by as much as 21%. Here’s how to weather the impending storm.
-
A Social Security Storm Is Gathering: Here's Your Safety Plan
If Social Security reserves are depleted by 2033, as predicted, future benefits could be cut by as much as 21%. Here’s how to weather the impending storm.
-
What a Second Trump Term Means for Investing in Water SafetyA new administration focused on deregulation could change the scope of today's water protections. So, what does that mean for the investors who support them?
-
How to Avoid These 10 Retirement Planning MistakesMany retirement planning mistakes are easily avoidable. Here are 10 to have on your radar so you don't end up running out of money in your golden years.
-
Before the Next Time Markets Sink, Do Your Lifeboat DrillsAn eventual market crash is inevitable. We can't predict when, but preparing for the ups and downs of investing is imperative. Here's what to do.
-
This Late-in-Life Roth Conversion Opportunity Spares Your HeirsExpensive medical care in the later stages of life is an unpleasant reality for many, but it can open a window for a Roth conversion that benefits your heirs.
-
Women, What Is Your Net Worth?Many women have no idea what their net worth is, or even how to calculate it. Many also turn to social media finfluencers for advice. Here's what to do instead.
-
Converting Retirement Savings to a Roth IRA? Don't Do ThisYou might want to convert all of your savings to a Roth in one go, but you could end up paying hundreds of thousands more in taxes than you have to.
-
What Is Your 'Enough Is Enough' Number for Retirement?Chasing a 'magic number' for retirement can be anxiety-inducing. Instead, build your plans around a personal number that reflects your individual circumstances.
