Rose Palazzo is the Group President of Envestnet Financial Planning, where she oversees all MoneyGuide operations.
Russ Alan Prince: How have advancements in financial planning software allowed advisors to engage their clients in new ways throughout the planning process?
Rose Palazzo: The advancements in financial planning software over the past decade have made it easy for advisors to not only develop deeper relationships with their current clients, but also expand their services to all clients, regardless of wealth, stage in life, and complexity of finances. These innovative tools can provide a holistic view of your client's finances and help you create plans that achieve their goals while fostering a dynamic and collaborative advisor-client relationship.
At Envestnet, we believe that everyone should be able to live an Intelligent Financial Life and we understand that technology plays a large role in that process.
We are dedicated to this mission and focus on helping advisors use financial planning to more effectively motivate each client to create, implement and maintain an investment strategy that best meets their financial goals no matter their life stage. Specifically, MoneyGuide allows advisors to take a deep dive into their client’s financial life—helping them with the decisions they make to buy, save, invest, borrow, protect, and earn—to provide a realistic plan.
Prince: What makes the concepts of MyBlocks so appealing to advisors and their clients?
Palazzo: By 2030, McKinsey & Company estimates that 80% of new wealth management clients will want to access advice in a Netflix-style model—that is, data-driven, personalized, continuous, and, potentially, by subscription. MyBlocks is ahead of this trend. This set of interactive tools provides mini financial planning experiences, that typically range from 2 to 5 minutes, focused on making complex financial topics easy to understand for the client.
The MyBlocks series breaks down financial topics and questions and offers side-by-side comparisons of different potential outcomes. This innovative ecosystem includes over 35 interactive modules, some examples of topics include Social Security, retirement compatibility with your partner, college loan debt, and building an emergency fund.
MyBlocks empowers advisors to have more impactful conversations with clients about their goals, financial plans, and how to achieve financial wellness. This ultimately enables advisors to collaborate with clients in the planning process and allows them to engage with topics of their choice and at their own pace.
A recent addition to MyBlocks is the Prospecting Center feature, which allows advisors to leverage these experiences for prospecting and lead generation. Using this new capability, advisors can share URL links to specific blocks directly with prospects, or embed links on their digital channels—website, social media, blog, and more. Prospects can then register and start the MyBlocks experiences. Bonus, the information collected through these blocks is then made available to the advisor via the MoneyGuide platform.
Prince: Helping clients to begin and work on their legacy plans is one of an advisor’s most important jobs. How does MoneyGuide assist advisors during those conversations?
Palazzo: Helping clients to begin and work on their legacy plans is indeed one of the most important jobs of an advisor. In my opinion, it is never too late to review these plans with clients, and an important yearly task to update them given the rapidly changing times we are living in. Our technology, Wealth Studios, allows advisors to interactively model advanced estate planning strategies, address client cashflow questions prior to retirement, and model dynamic net worth over time. Within the first year on the market, Wealth Studios was named the #1 estate planning tool by the 2022 T3 Tech Survey.
Wealth Studios includes a detailed cash flow analysis as well as advanced estate and legacy planning tools that address ultra-high-net-worth client needs, like trust modeling and inheritance fairness planning. Wealth Studios consists of the:
Income Studio: Offer clients a holistic view of their yearly income sources, including all interest and dividends from held-away assets. Plus, the ability to educate clients on how their expenses can be funded and if a surplus or deficit is likely to exist at the end of 12 months.
Lifestyle Studio: Engage your clients with the ultimate, interactive experience, allowing them to co-design their own plans and make informed decisions for their future. Advisors can incorporate new strategies and discuss financial risks and opportunities while stress-testing clients’ financial plans. A breakdown of projected net worth on an annual basis is available to drill down by asset type and individual asset balances.
Legacy Studio: An advanced estate planning tool that can help simplify the complexity of estate techniques. Use this tool to demonstrate the transition of wealth between generations, the impact of establishing trusts, and the potential benefits of various gifting strategies. The Family Tree View overlays the flow of assets between heirs and entities at each of their projected deaths and updates live with the modeling of strategies and recommendations.
These additions to the Envestnet ecosystem help the firm execute its mission to deliver an intelligently connected financial life for investors. The data and insights powering these capabilities support each phase of advice, from determining an estate goal to engaging with the Envestnet Trust Services Exchange to meet the estate's needs, within a hyper-personalized client portal that can be accessed anywhere and from any location whenever clients decide they need it.
Disclosure: Nothing contained in this article is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The information, analysis, and opinions expressed herein are for informational purposes only and represent the views of the author, not necessarily the views of Envestnet. The views expressed herein reflect the judgment of the authors as of the publication date and are subject to change at any time without notice. All investments carry a certain risk, and there is no assurance that an investment will provide positive performance over any period of time. Past performance is not indicative of future results.
RUSS ALAN PRINCE is the Executive Director of Private Wealth magazine (pw-mag.com) and Chief Content Officer for High-Net-Worth Genius (hnwgenius.com). He consults with family offices, the wealthy, fast-tracking entrepreneurs, and select professionals.