Create reports that look more professional but cost less.
Most financial advisory practices that offer advice
to their clients for a fee are faced with the challenge of how to
efficiently deliver that advice on an ongoing basis. It is one thing to
purchase a financial planning software program, collect data from the
client and produce a document that addresses that client's financial
situation and needs. It is quite another to use that program
effectively on an ongoing basis and be able to integrate other
information sources, such as current investment information.
What often results is a patchwork of client information, statements and printouts from a variety of different sources, all jammed together in some fashion.
Some financial advisors have asked if there is a better way to produce such a resource for the client. The answer is a qualified yes. However, depending on the size of your practice, the specific needs of your clients and how much information you want to integrate into an ongoing update document, the specific solutions could be quite different.
Consider a case in point: Mark K. owns a small financial advisory practice. He offers financial planning for a fee and charges the client an ongoing retainer for advice. He also manages assets for his clients and charges separate fees for that service. But, because he has segmented his fees to specifically include an ongoing advice fee, he feels that he needs to update his clients on their progress toward their financial goals on at least a quarterly basis.
Therefore, Mark has created an update binder. The binder consists of some net worth and cash flow statements culled from the original financial plan and updated to reflect current conditions. He also prints out quarterly statements from his portfolio management software (dbCams, in this example). To add value to the binder, he may include additional information on specific investments such as Morningstar reports, or similar information printed out from separate sources. He then takes all these different pieces of information and loads them into the three-ring binder. Not a bad approach when viewed at first glance, except that each section of the binder is separately paginated, each section may have different fonts, character spacing and paragraph formatting. And graphics such as charts, or other illustrations, might look entirely different from one section to another. In short, the binder lacks a professional, integrated appearance.
If your practice is looking to improve its the financial planning update process, from one similar to the example above, there are systems and techniques available to help you. But, before you rush out and buy new software or other expensive options, you may want to take the time to think through what it is that you want to produce (and for that matter, what it is that your clients will most benefit from). Whether you are shooting to "redo" the whole financial plan every three months or to just provide a forum for discussion of goals and current results, consider what your goal for an update report (plan) is. Most practitioners would agree that a financial plan, once completed, is virtually obsolete. Due to the time-sensitive nature of information related to investments, the financial plan stands as a picture of a client's financial situation and needs based on a point in time.
To translate that into an ongoing monitoring and review process entails using current information and being able to provide comparisons to the original data. This is tougher than it might seem. Few financial planning software packages exist that can handle ongoing coordination of data and comparisons to older, or original, input data. Financial planning software that is configured to import data from a portfolio management software program or account aggregator, or that is a part of a suite of products that share data, would seem to have the edge in this area. Examples might include MoneyGuidePro, Naviplan, Schwab's new Relationship Manager and Advisor's Assistant, to name a few.
If you export data to (or import from) an outside program, such as Morningstar's Advisor Workstation for portfolio monitoring, you are faced with the challenge of integrating output reports with other sources of information. For this purpose, you will need a document assembly process. Fortunately, there are choices available.
There is a powerful software package called Assemblege, available through Trumpet Inc. (www.trumpetinc.com), that collates, assembles and files large documents such as investment performance reports, and integrates those reports with output from such sources as Microsoft Word or Access, your billing software and/or your contact management software. If you are looking for a stand-alone solution to build your update documents faster, easier and with the potential for fewer errors, Assemblege might be right for your practice. Attorneys have been using document assembly software for years. Products such as Assemblege are only now being retooled to fit the needs of other professions such as financial advisory firms.
If your practice does not necessarily need the integration with a contact manager or billing systems but still wants to find a way to combine various output sources into a single document, one simple approach is to use a software product such as Adobe Acrobat (www.adobe.com). The new Acrobat 7.0 Professional touts document assembly features such as being able to create a single Adobe PDF document from multiple sources-including portions of Web pages and previously combined Adobe PDF documents. In addition, you can print, extract or delete the subdocuments. You can also organize the combined document in any order you want to create the right flow of information. Even more, you can add enhanced headers, footers (yes, even common paginating for all sections of your update report) and watermarks. But, at $449 (suggested retail, new, or $159 for the upgrade version), the cost might prove daunting to practitioners of smaller firms.
A lower-cost alternative to Adobe Acrobat is Pdf995 Suite, which includes three products: Pdf995, a PDF document generator using a PDF format print driver; PdfEdit995, which permits combining multiple PDF documents into a single document and other editing functions; and Signature995, which offers state-of-the-art security and encryption for PDF documents. All three are separately offered for free for downloading from the PDF995 Web site (www.pdf995.com). But, an annoying sponsor page pops up each time you use it. To get rid of the sponsor page, you can purchase a suite key for $19.95. Though the suite of three programs may not be as robust as the Adobe product, the cost is certainly attractive. You may decide to test it out using the free version first, switching over to the paid version when the pop-up pages have annoyed you enough.
Although your goal may not be to simply produce a pretty document, having systems and procedures in place to produce an update report that looks professional, is accurate and efficiently produced, and meets the needs of your client(s), without placing an undo burden on your staff or you, is worth considering.
David Lawrence is a practice
efficiency consultant and is president of David Lawrence and
Associates, a practice consulting firm based in Lutz, Fla.