We talk about hiring “pitbull” lawyers because we want a fighter — someone with sharp teeth who won’t back down from a challenge.
While the term “pitbull financial advisor” isn’t familiar to the American lexicon, it should be. We choose doctors, attorneys, accountants and, yes, advisors for their knowledge and expertise. And that, sometimes, means pushing back and telling us when we are wrong.
Far too many advisors, though, see themselves as relationship managers or salespeople. While being a people-pleaser might make you and your clients feel good in the moment, being “too nice” will cost you both.
A few years ago, after reading a sci-fi novel about a fictional World War III where China defeats the United States using its technological might, I, naturally, called up my advisor to say that I thought I needed to diversify into Chinese equities. “Brilliant thinking,” he said, and after offering me some active strategies, I quickly became an investor in that market.
Within a week or two, China’s president, Xi Jinping, ordered the de-listing of Chinese tech companies on U.S. exchanges, sending the entire market into a spiral. Within days, I had lost 30% to 40% of my brand-new investment. But here’s the thing: “Smart money” had been well aware of these risks.
Salt entered the wound soon after, as the CEO of this wealth management company was explaining that his firm — my advisor's firm — had been advising its clients of the risks of Chinese investments for months. I did my research, poring over dozens of reports and commentary, and, lo and behold, he was right. The firm was warning about the dangers of investing in China. So, why didn’t my advisor tell me that?
As the wealth management industry has shifted from portfolio management to sticking clients in model portfolios, advisors have become more like file clerks, dutifully taking orders but offering less and less in the way of counsel.
What does this mean for the future of wealth management?
Despite the continued growth of the independent wealth channel, there are warning signs ahead for firms and advisors who fail to adapt.
According to Statista, the robo-advisory market is expected to reach $7 trillion by 2029. Traditional financial services firms such as Charles Schwab and Fidelity have rolled out their own digital solutions, hoping to reach younger, tech-friendly clients who already use an app for everything. As those clients age and attain more assets, will they see the wisdom in moving over to a human advisor at a significantly higher fee level? Probably not if the advisor is simply a more expensive version of an app, checking boxes without offering much more in the way of true advice.
We’re already seeing an erosion in assets. Javelin Strategy & Research found that one-third of advised clients with more than $100,000 in liquid assets maintain self-directed accounts alongside their financial advisory relationship, with expectations for that number to exceed 50% in the years ahead.
Advisory firms know that they need to adapt if they want to maintain and grow their share of wallet. Over the past several years, as the industry has consolidated, RIAs have broadened their appeal to offer so-called holistic and family office services, including estate and tax planning, family governance and philanthropy.
The 2024 Raymond James RIA Benchmarking Survey found that the number of RIAs offering family services more than doubled, from 20% in 2023 to 41% in 2024. Of course, not all firms that market these services actually deliver on them. But there are other ways to remain competitive.
At the custodial and platform level, financial services firms should be arming their advisors with the tools they need to shift from order takers to counselors.
In 2025, that means leveraging technology — particularly artificial intelligence — to synthesize and analyze news and proprietary research so that the next advisor isn’t encouraging a client to make an investment while the company’s CEO is publicly advising the opposite.
Technology should be helping each and every wealth manager to provide extremely high-level service, and that isn’t happening. Companies that survive and thrive have learned to effectively harness technological tools to deliver higher-quality services. We’ve moved beyond the either/or conversation.
If you expect clients to pay a premium to work with a human being, you have to offer them something that they can’t get from an algorithm. Ironically, technology can help advisors do just that.
Justin Whitehead is founder and CEO of Pebble Finance, a portfolio analytics and technology company.
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