Going into 2023, we’re in an extremely volatile financial market. Between rising inflation and looming threats of recession, investors are looking to their financial advisors to translate market volatility and protect their assets now more than ever.

And it isn’t just younger investors worried about the financial impacts of a shifting market — 67% of American investors are worried about their retirement plans as a result of market volatility in 2022 (a 20% increase from 2021).

Now is the time for advisors to prove their worth and placate their clients’ fears for the future. A recent survey from Envestnet breaks down three underrated areas where advisors can serve investors: short-term finances, long-term finances, and providing clarity for their overall financial picture. Let’s break down these three areas in detail to learn more.

Flex Your Finance Know-How by Organizing Your Client’s Short-Term Finances

In a constantly changing market, wealth advisors who help clients manage their short-term financial needs can stand out. In fact, even in good times, American investors could use help with short-term money management.

Envestnet’s survey found that 39% of Americans don’t formally organize their short-term personal finances at all, with 20% of affluent Americans not bothering to either. Of those who do organize their short-term finances, younger millennials are more likely than older generations to organize them with online platforms.

These findings give two important insights for advisors:

• Whether times are tough or steady, organizing short-term finances (such as rent payments, car payments, insurance payments, etc.) is a real need for American investors and can help clients feel more at ease with their day-to-day stability.
• Adopting online platforms and digital solutions to organize short-term finances is key for providing additional value for younger and affluent clients who already organize their short-term finances in some way.

Demonstrate Expertise in Managing Long-Term Finances

On the flip side, long-term finances are another area where American investors need advisors’ help. Nearly half (42%) of Americans don’t formally organize or plan long-term finances. Contrasted with just 15% of affluent Americans who don’t organize long-term finances, there is a clear gap where advisors can make a difference for clients.

Generational Differences

Surprisingly, 50% of Baby Boomer investors aren’t planning for their long-term finances in an organized way. With retirement right on the horizon, this is a crucial area where wealth advisors can step in and prove value.

Perhaps unsurprisingly, younger millennials are using online sources for long-term financial planning. A break from traditional wealth-planning strategies, this is an area where advisors can “enter the chat” and show their ability to provide long-term expertise along with emerging digital tools.

Regardless, in a market where long-term investing is under pressure and reliable portfolio construction is no longer a given, it’s increasingly important for wealth advisors to guide their clients’ long-term strategy through the ups and downs of today’s market.

Provide Clarity to Your Client’s Financial Picture

Lastly, one of the most important ways a financial advisor can provide value today is by giving their clients a clear picture of their financial health. Without knowledge of their current financial position, investors are unlikely to make progress, take action, or participate in meaningful ways in growing their wealth.

This is where financial advisors come in. Investors want it to be easy for them (54% of Americans wish there were a technology that handled their finances for them), so advisors should make it easy.

How can they do this? According to McKinsey, wealth advisors who build an all-weather asset management platform that is flexible, stable, and scalable can provide deep value and build client reverence, even in times of uncertainty.

Incorporating Docupace’s document management technology into your advisory services can streamline your backend, free up time to meet with clients, and scale as you grow by integrating with your other technology platforms. Learn more about our solutions here.