Envestnet|Yodlee Vice Chairman and CEO Anil Arora.

To showcase new RIA solutions, Envestnet|Yodlee Vice Chairman and CEO Anil Arora began his presentation in New Orleans at the Advisor Summit 2018 by recapping the theme of “financial wellness,” and stating that today’s business is switching from “product orientation to client orientation.” The new solutions also will appeal to the next generations of clients, he said.

On why “financial wellness” is key, Arora discussed findings that showed last year 85% of Americans are stressed and anxious about their financial lives, while the second closest concern was health care at 32%.

“Let’s go deeper: 56% of Americans have less than $10,000 saved for retirement. More than half of the country couldn’t come up with $500 for an emergency and 83% don’t have an emergency fund,” he told the audience of RIAs.

He added that 54% of high-net-worth individuals are concerned about being under-insured, and 41% of Americans have been victims of major data breaches.

“These are the reasons why [clients] are so anxious and so stressed, and if we are going to address these clients in more a focused way we need to understand why they are so concerned,” he said. “And this is the foundation that drives what we do in terms of our solutions and innovation.”

He pointed out that Envestnet “recognizes the brand in front of the client is yours … and we’re the intel inside. You need to make sure you pick the best partner.”

He then showcased some of the new solutions from Envestnet|Yodlee that are available now or will be launched this year.

“We have the benefit of scalability,” he said. “Data gets better with scale. It’s machine learning. The more data you see, the better the data becomes … it’s a virtuous cycle. We have 23 million users, 100,000 investor accounts.”

He also emphasized the importance of security, pointing out that for 15 years Yodlee has been making changes suggested by regulators and clients that increase its security.

He pointed out that the firm has 17,000 data sources, 100,000 client accounts, 90,000 advisors on its platform, and well over $2 trillion in assets under management.

“Big data is really the cost of entry to doing any significant machine learning and AI,” he said.

Arora noted that the Envestnet platform already offers software that allows advisors to see client balances, which allows for easier onboarding, account opening and account funding. It also offers several digital fin apps, such as showing client accounts and transactions across all accounts.

“But we also have some powerful analytic tools,” he said, including:

  • Envision IQ: This digs deeper into data science, answers who are the top clients, what is the average account size, etc. and it is linked to voice “that brings it to life,” Arora said.
  • Protection of personal data through LifeLock that includes full dashboard information on credit, etc.
  • AI-driven digital financial apps that provide information that is especially appealing to millennials, Gen X and Gen Z clients.

“We know younger people are tech savvy, big into social sharing, and have hyper-digitalized experiences,” he said. One new app helps clients know how much cash they have at any time, taking into account all revenue and payments, and provides a real-time cash balance showing what is available until the next paycheck or cash infusion.

Arora pointed out that with $33 billion in overdraft fees paid to banks on a yearly basis, this app will be especially helpful to clients, and to advisors who can discuss spending habits with clients.

Another app will provide a “FinCheck” score to show the financial wellness of clients, and outline spending on areas such as rent, digital services and dining out, for example, and will provide a deep dive into why they may be spending more than their peers. For example, for rent, it will compare what the client is paying compared to other people in that location.

“The point is this is how to connect with the next generation by using the power of technology,” he said, adding that all these products will be integrated with voice activation.

— Check out Envestnet Debuts Plethora of New Solutions at Advisor Summit on ThinkAdvisor.