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Half of Advisors Thinking of Dumping Their Firm for Better Tech: Survey

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The coronavirus pandemic has thrown a spotlight on how inadequate technology at financial advisory firms in the U.S. and Canada has disrupted services that advisors provide to their clients, Broadridge Financial Solutions, a fintech service provider, reported this week.

Firms that fail to address this issue could experience defections by frustrated advisors fleeing to more supportive ones. In fact, half of financial advisors surveyed said they often considered leaving their current firm for one that provides better technology tools.

Seventy-seven percent of North American advisors in a recent Broadridge survey said they had lost business because they lacked appropriate technology tools to interact with clients. Eighty-seven percent reported sustained changes in their communication and engagement with investors.

Of those who reported losing business, on average they lost 21.7% of their book, according to the survey.

“Financial advisors are reliant on their firms for technology that allows them to best serve their clients wherever they may physically be and whatever market conditions are like that day,” Michael Alexander, president of wealth management at Broadridge Financial Solutions, said in a statement.

“In the fallout from the pandemic, wealth firms are going to face increased pressures to invest in modernizing their advisor technology or risk losing their advisors to firms that already have next-generation wealth platforms.”

Research Knowledge and Insights fielded the survey in June among 254 financial planners and advisors in the U.S. and Canada.

Generational Differences

Amid the pandemic, 63% of North American advisors said they generally communicated with their clients on at least once a week. But that figure belies a surprising generational difference: 51% of millennial advisors said they communicated with their clients daily, while 62% of baby boomer advisors reported doing so only monthly or less.

Nine in 10 survey respondents said their desktop software and firm-provided technology tools had become more critical during stay-at-home mandates.

Across generations, 74% of financial advisors wished that their firm had access to better technology tools, and 82% said paperwork detracts from time spent working with clients.

Advisors under under 40 were more likely to report that they think of leaving their firm for better technology — 59% said this, compared with 32% of advisors age 60 to 79.

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