Close Close

Industry Spotlight > Women in Wealth

What Will (and Will Not) Change?

Your article was successfully shared with the contacts you provided.

As I started preparing for this column, two troubling sets of thoughts — and one troubling song — came to mind.

First, I thought, “When the editor of Research magazine asked me to write this piece, why did I agree?” I’m terribly cynical about attempts to predict the future, and even professional futurists and industry experts are notoriously wrong about their prognostications. (Remember Ken Olson, the president of DEC, who famously predicted in 1977: “There’s no reason anyone would want a computer in their home”?) I can’t even predict what will happen in my own life next week, no less 30 years out for our entire industry.

Then I thought about my intense dislike for Hollywood’s consistently bleak portrayal of the future. Whether it’s nuclear or biological war or terrorism, rapid “tipping point” climate change, asteroid or meteor impact, global famine, malicious super-intelligent computers and robots, or even alien invaders — we end up with a desolate Earth barely supporting a tiny number of hardscrabble human survivors. It’s the end of civilization — and the stock market! — as we know it.

Finally, a similarly bleak song came unbidden to my mind: In the Year 2525. This 1969 hit by the duo of Zager and Evans was the No. 1 song in America when Neil Armstrong walked on the moon:

In the year 2525If Man is still aliveIf Woman can surviveThey may find…

Well, in search of what “they may find” in our industry some 30 years from today, you’ll shortly see that I’m not nearly as pessimistic as Zager and Evans or Hollywood. And while I’m quite uncertain as to any specific prediction, I’m confident that, in the main, life as we know it — including the importance and necessity of the financial services industry — will indeed go on.

New SolutionsTo begin with, I predict that between 50 percent and 70 percent of the product solutions that will be available 30 years from now haven’t been invented yet. Similarly, rather than the pace of technological change slowing down sometime soon, the rate of change and its impact on our industry will continue to accelerate.

For example, within 30 years most of us will carry some kind of small multipurpose device that will be activated and verified by retinal scan. Along with a national ID, it will contain our complete medical history, driving record, credit report, continuously updated investment portfolio and bank balances. Such a universal “iSolution” will negate the need to fill out the same new doctor’s form for the umpteenth time; instead, you’ll just slip your device into a reader and your relevant records will be instantly transferred. In this way, the informational technology revolution will come full circle to truly serve not just the technically oriented, but the common person as well.

These information technology advances will create both challenges and opportunities for our industry. Some clients will want to be kept fully up-to-date on changes in their portfolios and the markets, and our industry will respond in kind, delivering personalized information updates. If you, as a client, want to see your portfolio in a simple pie chart constantly updated on your iSolution, then that’s what you’ll get.

Economic & Societal ChangeThe cyclical nature of markets and the economy will remain unchanged as we continue to move through multiple booms and busts over the next 30 years. There will be another bull market or two, a couple of recessions, and a couple of bear markets. In turn, there will be Congressional investigations following the market’s next great wave of excess, whether flowing from corporate malfeasance, the introduction of sub-sub-micro stocks, or whatever comes next. The indelible human desire for greater returns, and the average person’s misunderstanding of the relationship between risk and return, will continue to be problematic for the industry as fear and greed continue to feed the inevitable cycles of boom and bust. As things get out of balance in new ways, we’ll have to figure out how to fix them and reestablish a healthy equilibrium.

And while I don’t share Hollywood’s scorched-earth vision of the future, as a society we will in fact need to make changes related to our culture of consumption and the challenges of global climate change. Many of these changes are already happening, but their pace and intensity will increase.

For example, I can envision that in 30 years, 50 percent or more of Americans will work from home. While our over-reliance on Middle Eastern oil won’t change overnight, 30 years is not overnight. I foresee breakthrough technological advances that will address many of the major challenges that we currently face. America will rise to the challenge, and solutions will be found.

What Won’t ChangeWhat won’t change is American investors’ need to have access to real solutions, long-term thinking, and expert guidance. The wealth management business model (which we champion at CEG Worldwide) will continue to be the winning business model, with its focus on high-quality client-advisor relationships, in-depth knowledge of clients and their needs, and the delivery of expert guidance across a broad array of financial needs that enables investors to survive the inevitable excesses of the fear and greed cycle mentioned earlier.

While the Internet and some kind of iSolution device will greatly increase investors’ access to information, paradoxically this will increase rather than decrease the need for a long-term relationship with a trusted advisor. With many new investment opportunities available, a quality advisor will play the pivotal role of helping investors make smart decisions and avoid disastrous mistakes. A long-term trusted relationship is the greatest value proposition that a financial advisor can offer today, and this will be even truer in the future as investment opportunities multiply. That is, while many things will change in the future, one thing that won’t change will be the human side of the investment equation, and that’s why you, as a financial advisor, have a tremendous opportunity before you.

However, no advisor can afford to stay static. In order to succeed, you’ll need to stay ahead of the lifelong learning curve, keeping abreast of changes in markets, products and wise investment strategies. You can’t become a specialist of the past, but must instead become a specialist in the changing needs of your clients. In short, you must continue to grow, learn and build expertise on your clients’ behalf.

For example, there will almost certainly be many new product solutions that address not just the accumulation of the baby boomers’ collective wealth, but the measured distribution of that wealth. For the last 150 years or so our industry has focused mainly on wealth accumulation. But now, to be a specialist who is ahead of the curve, you have to focus on income distribution and the most tax-effective way to manage the nest eggs of boomer clients. Competently advising clients so that their portfolios remain intact yet produce enough income for a comfortable retirement will become a central industry focus in the future.

A Personal PredictionFinally, on the personal side, I predict that in 2038 I will effusively celebrate the Boston Red Sox surpassing the New York Yankees in total number of World Series won. (Hey, it’s my column and my fantasy of the future, so I get to choose what I predict!) In any case, enjoy the next 30 years; it’s guaranteed to be a wild ride.

Patricia J. Abram is a senior managing partner with CEG Worldwide in Florida; see


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.