The financial services industry is still recovering from the effects of the financial crisis. Positive impacts from the crisis include new regulations and clients taking an increasingly active role in their economic destiny. Reinforcing this is that all participants—financial advisors, clients, and regulators—are all welcoming the greater transparency and convenience that new financial technology (FinTech) is bringing to the relationship.
Another positive of the crisis is that it has created new client experiences and a new role for financial advisors. Clients are now in charge more than ever and know what they want and expect. They demand real-time information in everything they do, whether it be shopping or accessing investment information. The smartphone, in particular, has facilitated this. Investors clamoring for transparency and technology helps create a new, more empowered investor. Financial firms that do not address these changes run the risk of losing their clients.
Today is a pivotal time for an industry that was previously shrouded in secrecy before the financial crisis. Today, financial intelligence—through transparency and more high-value advice—is the only way that the financial services industry can survive. Online access and portfolio automation have allowed clients full access to their accounts and greater insight into its workings. This gives investors more piece of mind and a longer-term view of their goals while allowing the advisor to be more strategic with their advice.
FinTech helps the advisor focus on the role they should occupy—the giver of financial advice. This advice takes into consideration the whole client, their evolving situations, values, and expectations. With transparency and technology at the forefront, a higher value relationship between the client and their advisor is happening. Time is not wasted on administrative tasks since technology takes care of the heavy lifting. Clients have full access to update information and make changes themselves, with technology notifying the advisor.
With regulatory changes after the crisis and the new technology developed by startups and financial companies, there isn’t a better time to be an investor or a financial advisor. FinTech tools are available to us to see the real-time performance and plan accordingly to an investor’s ever-changing situation. We encourage all investors to take an active role in their financial lives by discovering and using the technology tools available today and the new tools in the future.
*Advisory services offered through Trajan Wealth, L.L.C., an SEC-registered investment adviser.
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