Technology will also be a central concern for advisors working with younger affluent investors, who will expect immediate, on-demand access to information and rapid communication with their advisors through multiple channels (including social media, online networks, podcasts and even texting). Convenience, transparency and efficiency-facilitated by technology instead of face-to-face meetings-will be highly valued by this demographic in their dealings with advisors. The upshot: Advisors' offerings and strategies will likely need to be more complex, technical and more customized than ever to serve this group.
Think Beyond
Ultimately, advisors must build on their success by preparing for the oncoming waves of new affluent clients and the changes, attitudes and expectations they will bring with them.
There's no question advisors as a group are extremely well positioned to capture many of the opportunities, but it won't be an easy road. Given increased competition and the challenges of working with new groups of investors, advisors must take the right steps to realize the future for their firms.
Advisors must take time now to understand the changes in client dynamics, demographics and behaviors that will affect their businesses. They must think beyond the current client base and consider those investors who are becoming increasingly prominent-and start identifying what needs to be done to attract them. They must evaluate the existing client experience and redouble efforts to provide exceptional service to what will be an increasingly diverse group of investors. And they should be prepared to work collaboratively with clients who are more engaged than ever in the process of building, managing, protecting and transferring their wealth. It's a tall order, to be sure. But the success of our industry thus far gives me the greatest confidence that RIAs are up to the task.
Next month, I will explore some of the trends occurring in the financial advisor industry, and the key steps that advisors should consider to build and manage a highly efficient and highly effective firm in the years ahead.
Bernie Clark is executive vice president and head of Schwab Advisor Services, a leading provider of custodial, operational and trading support for nearly 7,000 investment advisory firms.
1. 2011 RIA Benchmarking Study from Charles Schwab
2. Capgemini and Merrill Lynch Global Wealth Management, 2011 World Wealth Report
3. The U.S. Trust/Campden Research North American Family Wealth Planning Study 2010
4. Institute for Private Investors, Trends in the UHNW Marketplace: Advisor Roundtable
