Digital advisory model key in wealth transfer between generations, says fintech boss

Digital advisory model key in wealth transfer between generations, says fintech boss

Speaking on an upcoming episode of the ifa podcast, Advice Intelligence founder and chief executive Jacqui Henderson said the adoption of digital advice still has a “way to go”.

Specifically, she highlighted the distinction between digital tools and digital advice, with the former said to have become more widespread. Relatively speaking, the latter has been received with far more hesitation.

“The industry has a view that digital advice isn’t quite there, when in fact it is,” she explained.

According to Henderson, this has rebounded as advisers have struggled with increasing consumer demand.

“At the moment, they’re just in their cycle of being busy, trying to deliver to their customers, and not really taking the time to really look at the technology that’s available to them and start testing the waters. So I think it’s still a little bit of complacency about continuing to do things the same way and not adopting this new world that’s emerging, Henderson said.

However, she highlighted that with the impending transfer of wealth, advisers need to take the time to familiarize themselves with digital advice.

“I think we’ve got that intergenerational wealth transfer going, wehave consulting firms that serve their elderly clients, and whose generation of wealth is going to be passed down to their children. And being able to deliver a service offer that can be targeted at both segments, I think sois really the key, she said.

“Advisory firms need to look at digital within their business model and how it can redefine their actual business model, their service model, so that they can service scale but also serve the different segments if they want to diversify, in terms of the goal. markets that they want to start serving.”

Having run a wealth management firm, Henderson said she has seen the industry firsthands use of digital advice is struggling to catch up with consumers, who are becoming increasingly comfortable with incorporating technology into their everyday lives.

“I saw this gap between the way consumers were adopting technology and wanted to consume financial advice, and the way the industry was delivering financial advice … we really needed to start bridging that gap.”

However, she admitted that theres no “silver bullet” digital advisory platform, encouraging advisors who feel they have too many tools at their disposal to limit their technology stack and embrace an open framework.

“The industry is very complex, and having that silver bullet platform that does everything simply doesn’t exist. That’s why an open architecture, open API (application programming interface) for your technology provider is really important, so you can connect the different tools that you want , she concluded.

Henderson and Advice Intelligence are part of the establishment of the recently announced Australian Digital Advice Association (ADAA), which aims to champion change in financial advice regulation and improve the delivery of digital advice solutions.

The association’s founders – fund manager abrdn and firms Ignition Advice, moneyGPS and Advice Intelligence – will join Adviser Innovation’s editor, Maja Garaca Djurdjevic, on a panel at this year’s Adviser Innovation Summit to discuss their goals, and how a unified and coordinated voice for digital providers can revolutionize the industry.

To secure your ticket to the Adviser Innovation Summit 2023, click here.

Digital advisory model key in wealth transfer between generations, says fintech boss

Digital advisory model key in wealth transfer between generations, says fintech boss

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Last updated: 18 May 2023

Published: May 18, 2023

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