One thing that’s become clear from the Hayne royal commission this year is that the relationship between industry and consumers needs to change.
For financial advisers, this is something they’re grappling with all while trying to navigate technological upheaval, compliance and regulatory pressures, and changing consumer expectations.
As a result, the client-adviser relationship is shifting. No longer is it OK to just take a retrospective look at how a household has fared over the financial year. Increasingly, it’s becoming a continuous, forward-looking relationship.
Communication expectations have changed. Clients expect ongoing check-ins that are based on live data and advice that sets them up for the next opportunity. In practice, this means the very content of a meeting has transitioned from an update of where a client is at to a conversation around where a client wants to go. What are their goals and aspirations? How are you going to help them get there? Live data feeds means everyone can track their progress in real time and the whole meeting can be forward-looking.
With this, the expectations of consumers have expanded. Mobility and improved connectivity mean they’re expecting more from the technology and services they use. They expect more personalised services, which means advisers need to provide clients with multiple ways to communicate and engage. Clients increasingly need to be able to request help at any time and the expectation is that technology and mobility will drive this relationship.
There has been plenty of discussion around how artificial intelligence and machine learning are going to impact the financial advice industry. Many advisers and planners are concerned that these advancements will have a negative impact on their business – taking away the need for their services and eating into their client pool. However, when it comes to AI and machine learning, there is a mass of opportunity for advisers to benefit from. The technology can streamline relationships, processes and enable them to transition towards using data to be more proactive.
Technology has the ability to take live feeds, layer AI over the top and spot trends so advice can be more useful and relevant. It also means that advisers can take a whole of wealth approach to clients – looking at every aspect of their financial life and start to build a more comprehensive set of goals and plans to achieve them. This can include things like estate planning, wills, taxation, savings and budgeting.
Advisers also have the opportunity to play more of an educational role with the clients they serve – looking at the entire family and even helping the kids set savings goals, learn solid financial literacy skills and track their spending. Client relationships are increasingly becoming multi-generational and all-encompassing.
Technology and a shift in the industry, largely driven by the royal commission hearings to date, are starting to drive an inflection point in our sector. And while it’s yet to be seen where the royal commission findings will land, many are searching for answers and a new way to survive with old commission models fading. Clients are calling for more transparency and a better customer experience. For advisers attempting to build a business that’s future proof, it means they need to be addressing these changing needs and helping clients build wealth and better outcomes for their families.
Stephen Jackel, chief executive, Myprosperity
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 18 Jan 2019Advisers to suffer ‘horrendously’ from FASEABy Sarah Simpkins
- 18 Jan 2019Praemium FUA up 14%, reveals platform upgradeBy Adrian Flores
- 17 Jan 2019ASIC takes court action against former adviserBy Adrian Flores
- 16 Jan 2019NAB FP seeks resolution of false witness investigationBy Adrian Flores
- 16 Jan 2019High demand for advisers and paraplanners in 2019By Adrian Flores
- 16 Jan 2019Foreign adviser qualification standards finalisedBy Adrian Flores
- view all