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Industry Spotlight > RIAs

Envestnet Launches Trust Services Exchange for RIAs and BDs

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What You Need to Know

  • The seamless transfer of wealth to the next generation is a core element of financial planning for clients.
  • The new Envestnet Trust Services Exchange platform will make it easier for RIAs and BDs to do that.
  • The announcement comes only two days after Envestnet announced it’s building a new “personal financial ecosystem.”

Envestnet has partnered with Trucendent, a firm with a platform that facilitates wealth transfers, to provide a new solution for helping RIAs and broker-dealers to “seamlessly utilize trust accounts to facilitate the efficient transfer of wealth from generation to generation,” Envestnet said Wednesday.

The new Envestnet Trust Services Exchange platform will be fully integrated with Envestnet | MoneyGuide, Envestnet | Tamarac and other offerings in the Envestnet ecosystem, it said. “This will enable advisors to integrate this new capability into the platforms, processes, and patterns that drive their practice today,” Envestnet said.

The Envestnet Trust Services Exchange has launched and “several advisory firms are currently participating in the pilot offering,” an Envestnet spokesperson said. “The platform will be made more broadly available to advisors in early Q2 2021 and we encourage interested advisory firms to contact the Envestnet Trust Services Exchange now to learn more,” she said.

Being able to seamlessly transfer wealth to the next generation is a “core element of financial planning for clients and their families,” Bill Crager, CEO and co-founder of Envestnet, said in a statement.

“Advisors told us they wanted to be able to help clients navigate estate planning by using trust accounts that align with each client’s financial planning approach — and we listened,” according to Crager.

“The launch of our trust exchange is the latest milestone in the ongoing growth of our ecosystem, broadening the spectrum of tools and data-driven intelligence advisors need to empower an intelligent, connected financial life for their clients,” Crager said.

The announcement came only two days after Envestnet announced it was building a new “personal financial ecosystem” that aims to educate consumers and help them better connect with financial professionals — while also improving the user experience and data-sharing capacity of both advisors and consumers.

That ecosystem includes new Envestnet tools, which should be available for advisors over the next few months and consumers by year-end, as well as a planned consumer app by year-end, Crager told ThinkAdvisor on Friday.

By extending client relationships into the next generation, advisors can gain control of assets and the associated revenue for longer periods of time, Envestnet said Wednesday. The solutions provided by the new platform “can also help to capture new assets for clients who currently use other trust providers for both trust administration and asset management solutions,” it said.

Advisors who use the Envestnet Trust Services Exchange “do not have to foster external relationships with attorneys and trust administrators in order to open, approve, and monitor the trust accounts recommended for their clients,” according to Envestnet.

The exchange has a network of attorneys and trust administrators who will work with advisors to handle trust account documentation, asset transfers and regulatory compliance navigation. After a trust account is opened, the advisor, client, attorney and administrator can work together on the exchange’s platform, where the advisor will maintain custody of the client’s assets, Envestnet said.

“Without an estate plan and trust account strategy, clients risk losing control of their life savings after death or incapacitation,” according to John Yackel, executive managing director and head of strategic initiatives at Envestnet.

“But while advisors understand that many of their clients will likely be part of one of the largest intergenerational transfers of wealth in history, they have yet to fully embrace estate planning and trusts because they believe that they need the expertise of other service providers,” he said in the announcement.

Therefore, “in response to demand from advisors, Envestnet has developed the Trust Services Exchange to provide advisors and their clients with a unified experience that drives the definition of wealth transfer goals, advice, trust documentation, and account implementation — with embedded integration of attorneys and trust administrators,” he said.

More than 105,000 advisors across more than 5,100 companies now leverage the Envestnet platform, the firm said.


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