Blucora, the owner of TaxAct software and HD Vest, says it plans to offer its 5 million do-it-yourself tax clients access to Financial Guard’s robo-advisory platform in the upcoming tax season and later in 2017 to HD Vest’s roughly 4,600 affiliated advisors who want to use it to work with smaller accounts.
The robo-advice will include “tax-smart” investing strategies, the company says, and TaxAct clients will be able to open IRAs and taxable investment accounts on the Financial Guard platform. They also can request to work with an advisor at that time.
“It’s a first-of-its-kind development … that connects tax filings and openings of personal retirement accounts,” said Blucora President & CEO John Clendening, in an interview with ThinkAdvisor.
“The crucial point is that we are engaging consumers in that one time of the year when they are thinking [about] their financial situation,” Clendening said. “For some, tax season is when it happens and [when they can] benefit from talking to an advisor at the right time.”
Financial Guard, an online RIA and tech provider, is a unit of asset manager Legg Mason. Legg Mason announced plans to buy 82% of it in July, about a month after Morningstar said it purchased InvestSoft Technology, which offers fixed income analytics.
According to Clendening, the Financial Guard robo-advisory platform is compliant with the Department of Labor’s new fiduciary standard, which Blucora “had in mind when it was completing its [robo-advisory] solution for HD Vest advisors.”
“While we do not know what is going to happen with DOL,” he explained, “this was purposefully built to be compliant for advisors.”
Wells Fargo Advisors entered the robo-advisor space in mid-November, when it announced a partnership with the tech firm SigFig. That news came six months after UBS’ wealth management group in the Americas said it struck a deal with SigFig to work on a variety of digital tools for its reps and advisory business.
UBS, Eaton Vance, New York Life and several other firms have invested $40 million in SigFig. Also, LPL Financial, a large independent broker-dealer with more than 14,000 affiliated registered reps, has said that is moving to introduce an automated portfolio program in collaboration with BlackRock’s FutureAdvisor platform.