Is innovation in technology the future for wealth managers and investment advice?

Technology is key to bridging the investment landscape. It is already part of our everyday lives and many are increasingly looking online for investment advice. The challenge for wealth managers is to help clients to turn this data into advice that is relevant.

The market currently looks polarised: full financial planning services sit at one end of the spectrum, while at the other end is DIY advice. Most clients, however, sit somewhere in the middle, but their needs are not being properly addressed. It is vital for the industry to adapt to the growing opportunities presented by technology.

At the moment, most investment advice offerings are too focused on the needs of the Adviser. The process is long winded, with an overreliance on face-to-face advice. What we actually need is a model that begins very much with the client in mind, with Advisers thinking and behaving like clients.

Financial Advice is already online.

The reality is that in a digital age, all the financial information a client will ever need is available online; just googling ‘financial advice’ will bring up tens of thousands of results. If you combine this with information in the media – the personal finance sections of newspapers, on TV and even on Twitter, there is an overwhelming amount of investment advice and, often conflicting, opinion. However, simply providing more information for clients is not going to be sufficient. Clients need help taking action, rather than being swamped by industry propaganda.

However, when it comes to utilising this information, many people struggle to make it meaningful. The financial advice industry should be able to help clients make this information work for them. An important step for the industry then would be to ensure they are comfortable not only beginning their journeys online, but also going full circle and ending them online too.

While most clients will be happy to manage their own finances most of the time, there will also be instances when they feel the need for human interaction. Wealthier clients for example are more likely to have complex needs, which will require more personalised advice: Advisers are likely to remain important for these clients.

So what’s the future of investment advice?

The future of wealth management and investment advice lies in finding the balance between guiding clients through the important stages of their life while enabling them to manage their own finances. There is a need for a business model which meets the needs of clients digitally, for simple needs, but offers additional augmented advice delivered as and when required.

In a world where personal financial management is increasingly taking place online, there is an unprecedented opportunity to offer online investment advice to a wider audience. The good news is that clients are happy to act quickly once they have made a decision to invest, but it is important that the industry captures this interest, or they face the prospect of missing out on a raft of new customers and failing to meet the needs of existing clients.

Past performance is not an indication of future returns. The value of investments and any income from them is not guaranteed and can go down as well as up.  If you have any questions about the suitability of an investment, you should seek financial advice.

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Investment risk: Investment in the stock market is not a suitable place for short term money and you may not get back what you put in. All investment carries risk and it is important you understand this, if you are in any doubt about whether an investment is suitable for you, please contact us. Investment in the stock market and any income derived from it, may go down as well as up.

Wealth Horizon certainly lives up to its promise of making investment simple to understand

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