The Kitces.com research team has published its latest advisor technology report, highlighting the wealth management technology that independent financial advisors use in their day-to-day operations.
One major takeaway: Widespread adoption and an ever-growing number of choices have not led to higher tech satisfaction among advisors.
As the report details, advisors’ use of technology has grown significantly over the past two decades — and particularly in the past four or five years.
Firms have embraced technology for a variety of purposes, including to differentiate themselves in an increasingly competitive marketplace and to allow their advisors to serve more clients more effectively.
The result is an industry where a typical advisory firm allocates 4% to 6% of its annual revenue to technology, the report suggests, supporting an average of 12 software applications to implement 20 business functions. Half of firms say their primary use of technology is to improve the quality of their financial planning capabilities, with other important purposes being to deepen client relationships and improve efficiency in repeatable processes.
Michael Kitces, the Kitces.com founder and “chief financial planning nerd," unveiled the 200-plus page report during the opening main-stage presentation at the Future Proof Festival in Huntington Beach, California, joking that the report is distinctive for its focus on the technology that advisors “actually use and actually like.”
Most remarkable, Kitces said, is the extent to which even the least technologically sophisticated firms have embraced technology. On average, these lagging firms still use 10 tools to support 16 functions.
“This underscores how certain foundational technologies have become so essential to modern advisory firms that their adoption and the share of advisors supporting a function with technology is now virtually universal,” Kitces said.
This proliferation in available solutions has coincided with a marked decline in satisfaction with those options, Kitces noted. Of the 23 “AdvisorTech” categories directly comparable between the firm’s 2023 and 2025 reports, average satisfaction ratings fell in all but three: AUM fee billing, client data gathering and equity compensation/stock option planning.
The steepest drops occurred primarily in business development areas such as website platforms, digital marketing, and proposal generation and sales enablement. Notably, the decline extended broadly across operations, investment and planning functions.
According to Kitces, a key reason behind this decline is the challenge that firms face in deciding whether to support new initiatives — for example, launching retirement income planning services or standardizing staff procedures — by using technology within their existing “all-in-one” platforms or by adopting stand-alone “best-in-class” solutions designed for specific functions.
An increasing number of advisors are choosing the former route, Kitces said, often leveraging their tools for the “big three” functions of financial planning, client relationship management and investment management.
Regardless of managers’ approach to building the business, Kitces emphasized, successfully navigating between all-in-one and best-in-class approaches is challenging. This is because neither strategy alone reliably produces better outcomes.
“In many specialized planning areas, stand-alone solutions generally receive higher satisfaction ratings,” Kitces noted. “For more administrative functions advisors more often report higher satisfaction when using built-in capabilities within their existing platforms.”
Ultimately, Kitces said, the market demands that advisors leverage technology to offer deeper services for their clients while often forcing them to “settle” for either underwhelming capabilities and less intuitive user experiences from “all-in-one” tools or the added costs and integration challenges of stand-alone solutions.
Pictured: Michael Kitces
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