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Written by: Molly McClure, Head of Marketing, intelliflo
Last month, hundreds of financial advisory and wealth management professionals gathered at Future Proof Citywide in Miami Beach, Fla., to collaborate on pertinent industry challenges and opportunities. Between the insightful keynotes, one-on-one discussions with industry leaders and dynamic group debates, several key trends and themes emerged as especially critical for financial advisors to pay attention to. These include the long-term nature of investing, the need for RIAs to identify and leverage their strategic differentiators and the shifting role of technology.
Prioritizing long-term strategies.
The market volatility and fluctuations experienced in recent years have caused many to turn reactionary when it comes to their investing. After all, an uncertain market increases the likelihood of people making knee-jerk, and often reckless, financial decisions. This is where advisors must be prepared to step in, explaining the importance of sticking to long-term plans, 10 to even 30 years out. These deeper conversations around the future can ease investors’ anxieties and help them understand why they need to stay the course. As Mellody Hobson, CEO of Ariel Investments, noted at the event, "In times of great market uncertainty, don't do something, instead stand there. You don't sell into these difficult periods; you want to stand and be resilient until there's a calm to see where things are going." While these discussions with investors can be difficult, they often prevent investors from making emotional decisions and ultimately strengthen relationships and loyalty.
This need for increased patience and honest two-way dialogue underscores a broader trend, the evolution of the financial advisor role. Advisors are increasingly being challenged to show up for investors with more empathy and strategic thinking than has typically been required in the past. Instead of immediately turning to numbers and spreadsheets, successful advisors are embracing the human side of advice, delivering more holistic and personalized solutions and guidance.
The dire need to differentiate.
In the increasingly crowded financial advisory landscape, creating a competitive advantage has become a critical imperative. Despite this urgency, many RIAs still struggle to articulate and highlight their differentiators, putting them at risk of being overlooked or left behind. To overcome this obstacle, RIAs should go back to basics, answering fundamental questions around their mission, vision and what they can do for investors that other firms cannot.
Once these key differentiators are identified, they should serve as a foundation across the enterprise. For example, making even minor website updates to reflect a firm’s brand identity can go a long way. And perhaps most importantly, by understanding their own DNA and niche, RIAs can be empowered to make more intentional business and technology decisions.
Those who are able to pinpoint their strategic differentiators are able to more effectively allocate resources and support ongoing growth. For example, understanding their unique value proposition helps RIAs determine what areas, if any, should be automated or outsourced, saving more employee hours for areas such as sophisticated investment strategies, financial planning or intricate relationship management.
Balancing the equation of people, processes and technology.
During the event, Michael Kitces shared some alarming research: the average advisor only spends 60% of their time on client-facing activities, with the other 40% being dedicated to administrative tasks, investment management and meetings. While technology is a crucial piece of the puzzle, technology alone is not enough to solve this productivity gap. Instead, modern technologies that can automate and streamline manual tasks must also be paired with intentional organizational design, the right team structure and efficient processes. Those who rely on technology alone, without these other components, risk falling behind.
These three trends will be crucial for advisors to watch as the financial advisory landscape continues to face shifting investor preferences, challenging macroeconomic conditions and the expectation to better serve more investors. RIAs that heed these trends and themes, making the necessary tweaks to their business strategies and technology stacks, are more likely to successfully grow and stand out in the increasingly crowded market.
Related: Three Wealth Management Trends To Watch in 2025
Molly McClure is Head of Marketing for intelliflo. intelliflo widens access to financial advice through leading technology which powers the financial advisory experience.