Four Barriers to Success for Financial Advisors – And How to Overcome Them

Today’s financial advisors face more competition than ever before – from the advisor down the street to large wirehouses and broker-dealers to robos, investors have more options for where and with whom to invest their money.

On the flip side, there’s also never been a greater need for sound financial guidance, considering not only the market volatility we’ve experienced over the past few years, but also the ongoing great wealth transfer. This opens up an enormous opportunity for advisors who are in the position to seize it – but beyond the simple increase in competition, advisors are facing other barriers and complications to success. 

Some can be massive obstacles, while others are more minor road bumps. Each barrier that you can eliminate, though, improves your ability to more effectively serve existing clients, attract new ones, and future-proof your practice.

Barrier 1: Streamlining Your Operations

If you’re like most advisors, you want to spend your time advising, but without efficient operations and a powerful tech stack, executing tedious manual processes will likely get in the way of spending time building relationships with clients or prospecting new ones. 

Whether you like it or not, as a modern advisor, part of your job has become acting as a technology expert to streamline your processes, ensure you’re taking advantage of the latest investment expertise, and create a powerful digital experience for your clients.  

Of course, building a modern and intuitive tech stack can be the key to overcoming operational challenges, but it typically means a massive investment of both time and money, stretching already-thin advisor resources even further (consider the fact that Wealth Management estimates advisors need between $50,000 – $100,000 just to start their own firms). 

Barrier 2: Developing a Unique Value Proposition

As we mentioned above, competition for investors’ assets is only increasing. An advisor’s human touch will always be a powerful competitive advantage over robo counterparts, but most advisors didn’t bring a marketing degree with them when they started their practices. 

Determining exactly what makes your services unique, communicating it effectively and making sure that message gets in front of the right people is quite literally another full-time job, one that requires a nuanced approach and technical expertise that can be difficult to master.

One way to overcome this barrier is by focusing your firm on a (very) specific niche. According to Michael Kitces, author of the popular Nerd’s Eye View blog and co-founder of the XY Planning Network, after 10 years in business, niche firms have double the revenue per client than generalists. And it makes sense – the more specific your client base, the more effective you’ll be at communicating exactly how you help solve their very nuanced and particular challenges.

Barrier 3: Increasing Revenue and Profits

Serving sophisticated clients with more assets is the most effective way to increase your firm’s profitability, rather than simply continuing to add more clients to a book of business, which eventually becomes unscalable, unprofitable, or both.

But serving higher wealth effectively requires mastery of a more diverse set of skills than most mass affluent investors demand.  Advisors that are able to diversify their services to include estate planning, life insurance, tax planning and business owner solutions have a much greater chance of managing higher-net-worth client assets throughout their full financial journey, helping them stay more profitable. And while it might feel overwhelming to consider adding such services to your catalog, technology can help. 

At AssetBook, we prioritize partnering with other tech providers that enable advisors to take a truly comprehensive approach to wealth management.

Barrier 4: Keeping Up with Client Demands

Modern investors are looking for more from their advisors than ever before – greater personalization of services, higher-touch engagement, ongoing communication, and the ability to view their full financial picture anytime they want to. 

Just like leveling up service offerings, the right technology can go a long way toward creating the client experience today’s investors are looking for. While most client portals and mobile apps are underwhelming at best and clunky, frustrating experiences at worst, AssetBook understands the importance of client engagement to advisor success. We built Valian to be the solution to the client expectation challenge, infusing it with the powerful engagement, transparency and communication capabilities the modern advisor-client relationship demands, all while ensuring it keeps our advisors compliant with the SEC record keeping requirements.

Advisory success in today’s competitive market isn’t a given, but the right technology partner can help alleviate modern challenges while arming advisors with the tools they need to grow their firms.

See the AssetBook difference. Learn more about Valian and our portfolio management solution, Pulse, here.