[Holistic financial advice has become an increasingly important topic of discussion and debate across the industry. Much has been said by advisors and wealth management firm leaders about this advisor business model but, most important, is the reality that financial consumers have come to expect a more highly personalized advice experience that combines digital, virtual, and human interaction on a broader range of products and services.
Accenture’s The New State of Advice 2021 survey interviewed over 1,000 wealth management consumers to understand what investors expect from their wealth managers regarding financial advice, products, and planning. The survey reveals that 55% of financial consumers across a broad spectrum feel the advice they receive is too generic, and digging further, almost 90% of High-Net-Worth investors with $10 million or more in personal wealth felt the same way.
The survey report emphasizes that this is an opportunity for wealth managers to expand their advice offerings beyond just managing investments by learning how to deliver a more holistic and personalized experience at scale. However, standard advice business models may not have kept pace with the rapid rate of change across new services, products, and technologies available to the industry.
The report further explains how holistic advice “requires a breadth of guidance, products, and services beyond investments, delivered in the right context to meet a client’s financial, emotional, and social goals”. This effort reimagines the client-advisor relationship by looking at the client holistically, across their balance sheet and across their life stages. It requires wealth managers to think differently and act differently. This more expansive approach can create a path for advisors to create a compelling story introducing unique, client-centric offerings as a competitive differentiator. To do this, wealth managers must bridge digital, advice, and service, while equipping their advisors with the skills and technology they need to create a seamless customer experience and ensure a comprehensive, holistic approach to financial planning and advice.
To better understand how advisors can respond to this holistic advice model opportunity, we reached out to new Institute member Dan Collison, managing partner of Advice2Advisors — a financial advisor professional development firm specifically designed to help advisors build holistic processes for every aspect of their business. This encompasses from tax and investment planning processes to referral and introduction processes. Dan’s workshops and keynotes were developed through extensive industry knowledge culled from working with top advisors across North America for over thirty years and empirical, professional development research including mindset, influence, and positive psychology leaders Carol Dweck, Martin Seligman, Robert Cialdini, Dan Ariely, and the DIA Institute. He is the author of The Financial Advisor’s Guide to Excellence and, publishing in February 2023, Building Bigger & Better — Growth Strategies of Top-Producing Financial Advisors.]
Bill Hortz: How would you define and characterize “holistic advice”? What does that look like?
Dan Collison: A number of years ago I heard a top-selling “holistic” advisor, Paul, speaking about his business model. Paul said that when he completed the paperwork to open a new client file, he would look that new client in the eyes and state: “If ever you have a question you need answered, and it has a dollar sign in front of it, give me a call.” That statement comes as close to describing holistic advice as any I have heard. I would add, for clarification, that holistic advice includes:
• goal setting
• asset management
• cash-flow management
• risk management
• debt management
• tax planning
• retirement planning
• estate planning
Beyond these basics, I would include the need to have a good understanding of family law, as it tends to weave its way through so much of personal finance.
Great, holistic advisors start with a deep dive into client goal setting and then work with all of these financial planning elements to ensure their goals are achieved. Ultimately, they create a financial roadmap for their clients and formalize it within a written financial plan.
Hortz: What was your motivation to start a professional development firm for financial advisors built around holistic financial advice?
Collison: I was lucky enough to start my career in this industry with a firm that fully endorsed comprehensive financial planning, so holistic advice was at the heart of the work I did with my own clientele. Subsequently, I got into management at the firm where I was tasked with training and coaching this holistic methodology.
Shortly thereafter, I was hired at the Schulich School of Business to teach Personal Financial Management in the MBA program, where I taught part-time for 20 years. This forced me to go further into the empirical research on all things financial planning, as well as for coaching and personal development. Ultimately, my absolute belief in the need for quality holistic financial advice for consumers steered me in the direction of establishing Advice2Advisors with my business partner Tina Carthigaser. Through our firm, we have been able to work with financial advisors across North and South America, which has been unbelievably rewarding — and educational — for us.