Technology is flipping the financial planning script
18 Jul, 2022

Step by step, the future of the financial planning process is rooted in tech and is happening now!

Commonly known, the financial planning process consists of six basic steps. Each of these steps require work from a financial adviser. Today, this work can be performed through digital tools and platforms that improve efficiency and enable financial advisers and their clients to engage through effective and safe channels that don’t require a face-to-face meeting.

Before I venture into explaining how technology enables and empowers the various financial planning steps, it is important to note that the acquisition of new clients (which leads into the first step in the diagram) is also mostly digitised these days.

With traditional ‘cold calling’ something of the past, technology has given us a new ‘cold-call’ solution. It’s called social media! Understandably, many financial advisers are cautious of social media and as a result, will miss out on this opportunity. Fortunately, there’s technology available to simplify this process for financial advisers.

Let’s explore how technology has impacted the six steps of the financial planning process:

Step 1: Define the scope of the engagement

These days, financial advisers and clients can establish a formal relationship without having to meet face-to-face. Digital signatures and chat platforms like WhatsApp enable trust to be established instantaneously if the use of technology is backed by a credible brand.

Tip: Use WhatsApp to engage with your clients and prospects.

Step 2: Determine personal and financial goals

The most effective way to determine a client’s goals is in conversation. We feel much more comfortable if we can see the person on the other side of the conversation genuinely cares. Video conferencing is available on many free platforms and using these online tools makes the process to collect financial information and data more comfortable for clients.

Tip to advisers: Choose a video conferencing tool instead of travelling long distances to clients. This will result in enormous savings!

Step 3: Analyse and evaluate data

When financial advisers select financial planning software, it is important to select an online platform that is integrated with the product providers they support. Non-integrated software requires the recapturing of data which often leads to errors and/or inefficiencies.

Tip to advisers: Choose an online financial planning software product and stick with it. There are no perfect financial planning tools – accept it and rather focus on using the software effectively.

Step 4: Develop and present the plan

Video conferencing and sharing platforms make it possible for financial advisers and clients to collaborate online. While co-planning is a relatively new concept, these platforms make it possible for clients to actively participate in the process of developing a financial plan.

Tip to advisers: Never say ‘I don’t know how’, you must train yourself using the ‘how-to-guides’ and YouTube videos provided by the various providers.

Step 5: Create and implement the client’s financial plan

Integration between financial planning tools and product provider ‘quote’ tools are still limited, and a lot of data recapturing is required. Most product providers have prioritised integration and it’s only a matter of time before financial advisers will experience seamless progression from the financial planning process with minimal duplication required. This will result in an inherently compliant process where no submission requirements are set by product providers because client verification and due diligence will be done digitally.

Tip to advisers: Use the available tools and start changing your current new business submission and onboarding routines. It’s only a matter of time for these onboarding processes to be completely digital and paperless.

Step 6: Review and revise the financial plan

Technology already makes this process very efficient and effective. Financial advisers must use the features in their financial planning software to segment clients and schedule future review dates. In addition, all product providers offer financial advisers online and secure access to their clients’ portfolios.

Tip to advisers: Use the online real-time portals that product providers offer.

Like it or not, technology is not only the future, it’s the now!

The technology supporting the financial planning process is here to stay and will continuously evolve into every related process and routine financial advisers perform. Financial advisers that adopt technology, dealt with COVID successfully, and will continue to grow.

The number one reason advisers are not adopting technology is that they are not willing to change their work routines. Don’t be caught in the traditional model of having bricks and mortar offices with paper in storage and a lot of staff pushing paper. All the routines that involve paper and face-to-face client engagements must be challenged and aligned with the digital status quo.

Use the capabilities in the tools that you already use, make sure you understand all the features and decide if they will add value to your practice.

In the end, the adoption of technology is in the hands of the financial adviser. If you are reluctant to change, visit a financial planning practice that uses technology and get motivated. It’s time to learn, unlearn and re-learn!



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