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How Advisors Are Using Tech Now: Survey

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A new study from Broadridge Financial Solutions and the Financial Services Institute points up growth opportunities for financial advisors and the heightened role technology tools play in enabling them to provide a better service experience, foster deeper relationships and reach underserved communities and the next generation of investors.

Ninety-two percent of advisors in the survey reported satisfaction with their technology capabilities, but they still see opportunities for improved technology to better meet their practice goals. 

Eighty-three percent of study participants agreed that better technology tools would greatly improve new client acquisition, especially as a third expressed interest in prospecting outside of their current geographic location and will rely on improved technology tools to reach prospects virtually.  

“Advisors are taking advantage of this wave of digital transformation to provide investment ideas, offer financial literacy tools, discuss ESG trends and connect with clients and their families in new ways,” Christopher Perry, president of Broadridge Financial Solutions and a board member of FSI, said in a statement.

Fifty-one percent of advisors reported that they still conduct formal client meetings virtually, either by phone or video conferencing. Thirty-nine percent said they expect to increase their video conferencing usage in the next 12 months.

At the same time, 88% of advisors expect to either increase or maintain their current rate of in-person, formal client meetings in 2022. 

This survey was fielded in November by 8 Acre Perspective Corp. among 493 financial advisors and employees of financial advisory firms.

Crypto and ESG

As the market remains in a low interest-rate environment and investors look for creative ways to find returns, 64% of advisors report that they have seen increased interest in cryptocurrency from clients. 

Further, a third of advisors said clients have shown growing interest in environmental, social and governance investments as the asset class gains popularity. 

“With the rise of DIY investing and clients growing interest in branching out to new asset classes, financial literacy is of the utmost importance and advisors have a clear role to play,” FSI’s president and chief executive Dale Brown said in the statement. 

“There is a significant opportunity for advisors to educate current and prospective clients and empower them to make better financial decisions and technology tools can enable them be informed and connected.”

According to the study, LinkedIn and Facebook are the most widely used social media platforms by advisors for both business and personal use, providing other channels where advisors can reach their clients virtually. 

Fifty-eight percent of advisors described their practice as a “solo” practice. Of those advisors who describe their practice as a “team” practice, the average team size is four.

Broadridge and the FSI said this demonstrates that advisors are increasingly reliant on technology tools to service clients and fill the personnel gap.  

The study also found that 60% of advisors are equally focused on financial planning and investment management, yet those younger than 45 cited client-facing tools as the top area for technology improvement as they increasingly focus on holistic financial planning. 

Expanding Family Connections

Nine in 10 advisors reported that they have engaged or plan to engage with additional generations of existing clients, such as children or grandchildren. 

Of the those who do so currently or planning to do so, 79% said they directly raise the topic with their clients and 55% offer to build the financial literacy of clients’ children or grandchildren. 

While a majority of advisors recognize the importance of building relationships with the next generation of investors through existing clients, many also prioritize engaging their client’s spouse in financial discussions. 

Further, advisors said that on average, 68% of formal client meetings include both spouses.