The product has the potential to be as impactful on the financial planning space as robo-advisors have been in the investment management space for a number of reasons:
First, like robo-advisors, myMoneyGuide puts the consumer in the driver’s seat. While they must be invited by a financial intermediary or an employer to participate, once they are invited, they can choose the type of session that they want to attend and they can choose the time. Once they get their initial results from the lab, the odds are that issues will be identified that require the help of a trained professional in order to optimally address those problems. Furthermore, lab attendees do not get indefinite access to the lab results unless they engage with an advisor. If they choose not to attend a lab, their access ends after 14 days.
Second, the primary reason that individuals give for not engaging with an advisor, according to Kevin Knull, is that the initial data-gathering meeting is uncomfortable for new clients. Allowing clients to enter their own data and learn a bit about the planning process before engaging with the advisor goes a long way towards alleviating that discomfort.
Third, one of the primary challenges facing advisors who provide financial planning advice is scale. Research by Technology Tools for Today (T3) indicates that up to 40% or more of the cost of producing a financial plan can be attributed to data gathering and data entry when those processes must be handled manually. In the case of myMoneyGuide, much, and in some cases all, of the data needed to complete a plan will have already been provided by the client.
Fourth, many potential clients still believe that financial planning is only something available to the rich. By making it affordable for advisors to offer the labs on a large scale, and from there to produce a plan for less wealthy individuals and couples at a low cost (and they perhaps manage their assets on a very low cost, automated digital advice platform), myMoneyGuide makes acquiring a financial plan affordable to virtually everyone.
Also, myMoneyGuide can be used as a stand-alone marketing tool to attract new prospects digitally. Any advisory firm that is a MoneyGuidePro client can allow as many prospects as they’d like to visit their website, participate in a lab and engage with the advisory firm.
If your firm is one of the many firms that is planning to offer a digital investment platform to clients and prospects in order to compete with direct-to-consumer robo-advisors, pairing myMoneyGuide with such a platform would appear to be an astute move. If nothing else, it would educate prospects that robo-advisors are limited to offering investment advice as opposed to a broader range of financial planning services that your firm offers. It is a way to differentiate and to add value.
For those of you who work with retirement plan participants, myMoneyGuide could offer a tremendous opportunity to expand the scope of your business.
myMoneyGuide represents the first credible technology for delivering financial planning advice to a very broad audience. If successful, it will educate the public to the need for financial planning advice and make it available to all. Advisors will benefit because it can significantly expand the demand for financial planning advice and empower advisors to recruit and serve new clients at a rate unimaginable a few short years ago.