On the surface, RIAs and wealth management firms have one clear-cut job: increase the number of dollar signs attributable to their client accounts. Underneath the obvious ins and outs of offering investment advice and managing portfolios, however, lies a deeper and ultimately more fulfilling purpose: financial empowerment.
Advisors can play a large part in bettering their clients’ financial lives. Helping clients get control over their current state of financial affairs — and actively take part in planning for their future — can be a transformative and, in some cases, life-changing experience.
But how do RIAs help guide clients toward this sense of empowerment? By following some tried and true strategies that strengthen the client-advisor relationship and cultivate trust in the wealth management process. Here are three ways RIAs can empower their clientele.
Get To Know Your Clients’ Needs…And Then Advise Accordingly
Like most transactions in the digital era, consumers expect personalized, valuable experiences that speak to their needs and wants. If anything, this creed holds even more true when it comes to wealth management services.
Recent research found that about two-thirds of Americans consider a personalized goal-based financial plan extremely important when selecting financial advisors. Firms that offer the same cookie-cutter investment options to everybody, regardless of age, background, and personal interests, are quickly losing their appeal.
Part of fiduciary duty is acting “in light of the Client’s goals, risk tolerance objectives, and financial and personal circumstances.” This information is best obtained via one-on-one advisor-client interactions. Empowerment is a personal experience and means different things to different people. Advisors need to recognize that not all clients have the same expectations.
Some strategies that help promote individual client empowerment include:
- Streamlining Onboarding: The easier RIAs can gather client information, the better. Easy questionnaires, clear instructions, and an integrated cloud-based tool for storing customer data are great ways to collect client data.
- Intentional Goal-Setting with Clients: Identifying pain points and asking specific questions about short- and long-term goals can help RIAs understand how best to meet their clients’ needs.
- Automating Repetitive Processes: Investing in tools that free up advisor time to focus on building relationships can increase retention and overall client satisfaction.
Putting time into relationship development is the best way advisors can get to know clients and help them make educated, personalized investment decisions.
Keep Your Client (And Your Firm) In Compliance
A less obvious way of empowering clients is by ensuring their personal and financial information is well-protected against nefarious actors. Digital platforms offer risk management solutions that pull information from a myriad of input sources, identify troublesome behavior, and then distill it into a dashboard.
Docupace offers 45 types of threat alerts that firms can customize. Creating alerts for specific events and behavior will save risk management teams precious time manually reviewing each transaction and call attention to the most pressing threats first. Platforms that incorporate artificial intelligence can even predict problems before they arise.
It’s difficult for clients to feel heard by advisors when they aren’t certain their information is safe to begin with. Providing a secure foundation in risk management is one way to cultivate the kind of trust a strong client-advisor relationship needs.
Communicate Frequently with Your Client
Finally, investment personalization and effective risk management come back to the same core requirement: frequent, honest communication between advisors and their clients. Empowerment can’t happen without the clear sense of trust that clients inherently place in their advisors. And when advisors are stuck pushing paperwork or chasing down compliance issues, they lack the time to effectively cultivate that trust.
From onboarding new clients to identifying security breaches, automated software solutions can take on much of the work to successfully run a wealth management firm. Advisors spend less than 20% of their time meeting with clients, indicating that the very activities that develop crucial advisor-client trust are falling by the wayside.
Although each individual interested in wealth management advice comes into it with different expectations and goals, they ultimately all yearn for control over their finances. Feeling as if they know what the future holds for them and their families — at least when it comes to money — can play an outsized role in personal fulfillment. Unlike consultants in other industries, RIAs can directly impact their clients’ sense of empowerment. Setting up advisors for success in this area is a win for everybody.
For more information on automated, cloud-based client management solutions, contact Docupace today.
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