Banks and Credit Unions Archives - SigFig

What’s Your Next Move? 3 Areas of Investment to Impact Clients Now

Lauren Jarvis — Tue, 05 Sep 2023 17:09:03 +0000

[On Demand] What's Your Next Move? 3 Areas of Investment to Impact Clients Now

Top digital strategies for driving greater personalization and efficiencies

Steve Mattus

CIO & GM of Wealth

Steve leads SigFig’s investment strategy, style and policies, including strategic investments in AI intended to support the effectiveness and efficiency of advisors

Claire Willits Root

Director, Digital Wealth Product

Claire is instrumentally leading our digital wealth product solutions. Before SigFig, Claire spent many years at Gartner.

Tuhin Sen

Senior Product Manager, Engage

Tuhin leads Sigfig’s product, Engage. Before Sigfig, Tuhin has worked with organizations such as Uber, Lambdatest
and Deloitte.

We dedicated this event to address the pressing digital priorities of senior leaders in the banking, wealth management, and insurance industries.

In an era of rapid technological evolution, staying ahead of the curve is vital. This virtual event brought together industry experts, thought leaders, and innovators to explore the strategies and solutions that define where to place your bets in both digital wealth and AI-driven sales effective tools.

Why Listen?

In recent research, How can banks and lenders thrive in the era of uncertainty?, published by Moneylive, Smart Communications, and Salesforce, they identified 3 key priority areas in which senior executives at banks and other lenders were prioritizing digital investment:

Achieving Agility, Flexibility, and Scalability:

In today’s dynamic market, agility, flexibility, and scalability are non-negotiable. Discover how SigFig can help you meet these challenges now.

Optimization of Staff Effectiveness:

Reduce operational pressure and elevate staff effectiveness through digital automation. Learn how digital tools can redefine roles, making your team more efficient and customer-centric.

Enabling Cutting-Edge Self-Service and Personalization

Explore the realm of AI analytics, generative AI, and cloud-based solutions to empower unparalleled self-service experiences. Elevate customer conversations management through advanced personalization, meeting the demands of today’s tech-savvy clientele.

Learn more from Sigfig CEO, Mike Sha, on WealthTech Today

Engaging Advisors Through AI-Powered Collaboration

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Operational Efficiency for The Back Office: The Time is Now

Kerry O'Keefe — Fri, 18 Aug 2023 17:09:02 +0000

When was the last time you heard of clients choosing an advisory firm because they have a “great back office?” While the answer to that may be “never,” many of the relationship-building activities that clients value most are made possible by back office efficiency. In fact, a strong operating system can generate one of your firm’s most precious assets — advisor time.

According to the recent J.D. Power 2023 U.S. Financial Advisor Satisfaction Study, nearly one-third (28%) of financial advisors say they do not have enough time to spend with clients. These findings come at a crucial time for the industry as it also faces a growing attrition problem. According to Cerulli research, approximately 36% of total industry headcount plans to retire in the next ten years. Couple that with the alarmingly high 75% failure rate among rookie advisors, and the urgency to create high quality client time becomes even more apparent.

As institutions continue to manage through long-term digital transformation and data integration projects, here are three high-impact automation improvements that can help keep advisors engaged in what matters most — their clients.

Client account onboarding
For advisors, opening a new account should be a triumphant moment. Unfortunately, opening and onboarding new clients can be a tedious and difficult experience, and not the way either party wants to kick off the relationship. Advisors are often dealing with meeting prep, multiple systems that don’t talk to each other, and redundant data entry. The amount of time lost working across different systems can be staggering, which makes the onboarding process a great candidate for automation. Our technology and services are used by thousands of financial advisors and investors. We estimate the traditional onboarding process to take between 35 to 70 minutes per client and our technology is designed to significantly reduce onboarding time.
Even if your company has a complex set of legacy systems, there are a range of cloud-based tools that can streamline the experience, from proposal development to investment selection, with data flowing through a single platform. With these changes in place, the onboarding process can be significantly reduced to as little as 10-15 minutes per client, under most circumstances. If you consider an incremental time savings of 45 minutes for a given advisor opening 100 new accounts, that could amount to up to 75 hours or 9 full days of time that can be reallocated to developing relationships.
Compliance, oversight and account review
Anyone who has ever worked as a financial advisor understands the importance, but also the complexity, of compliance and account review. Even the smallest error or inconsistency can land an account in NIGO (Not In Good Order) limbo. Not only can this delay the transfer of assets, but advisors may be forced to navigate multiple systems which could require unnecessary back-and-forth with back office teams and a poor user experience, causing advisors to spend between 15 and 30 minutes per account review.
To alleviate these challenges, digital solutions can bring greater consistency and accuracy to the account opening and review process. Before an account can even be submitted, inconsistencies can be flagged and corrected with a client in the moment, significantly reducing the call backs and reworkings.
In addition, certain technologies can help advisors and investors identify the most suitable investment portfolio when opening an account. Through a host of questions about investor goals and risk tolerance, the advisor can suggest the right investment options to ensure the long term allocations are appropriate. Compliance logic should be built in and integrated across systems to mitigate risk, improve the client experience, and increase advisor success.
The right digital system can reduce time spent on compliance, oversight and account review needs to as little as 0-5 minutes per account. Assuming a 15 minute savings per account, an advisor opening 100 accounts could save up to 25 hours, or 2 full days a year.
Client servicing
Advisors should be focused on client service, but can not engage with their clients as much as they’d like if that precious time is taken up by mundane and administrative tasks. Advisors often get pulled away from problem solving and advice giving to support tax statement requests, account updates and money transfers. And of course there is the time spent chasing down clients for their mandatory annual reviews. Based on our observations and data we’ve reviewed, we estimate a typical advisor spends 25-60 minutes each year on this kind of client administrative support.
Through technology and automation, a single platform can support clients and their advisors in completing these tasks far more efficiently. Tech-enabled functions not only provide easier access, but they allow for video collaboration with these tasks already integrated. This kind of efficient collaboration can save an advisor up to 30 minutes per account. For an established advisor with 300 accounts, that could amount to a time savings of up to 150 hours or 19 days per year.

So what’s the right digital platform? Look no further — SigFig offers a seamless and modern digital wealth experience with cost-saving technology that will help you streamline your back office process, help determine investment suitability for clients, and help you satisfy certain compliance and review tasks more efficiently. Then you can focus on high-value client interactions and scaling your business, which is where your efforts should be directed.

See disclosures at https://sigfig.com/. All content presented herein and discussed in any referenced or linked materials is provided for informational purposes only and is not intended to provide any tax or legal advice or the basis for any financial decisions. Information presented is believed to be from reliable sources, but we make no representations as to its accuracy or completeness. Opinions expressed are those of the individuals presenting them and are subject to change, and not necessarily those of Nvest, Inc. or SigFig Wealth Management, LLC. Hyperlinks are provided as a convenience. We disclaim any responsibility for information, services or products found on linked websites.

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Reducing Friction in Financial Management: Empowering Advisors and Clients for Success

Kerry O'Keefe — Fri, 18 Aug 2023 16:46:41 +0000

The financial services industry, like many others, continues to seek ways to reduce friction in the customer journey. Achieving financial wellness requires a proactive and informed approach by advisors and their clients. But along the road to building a productive investment management relationship are many areas of potential friction: from the emotional nature of financial decision making for clients, to inefficient systems and processes on the advisor’s side.

The source of friction in financial management

To reduce friction related to taking financial action, wealth management firms need to first factor in what causes friction in the investor journey and realistically, what can be done to reduce it.

Let’s start with investors. As a financial advisor, it’s more than knowing your clients’ kids’ names. The 2022 book, The Psychology of Money, does a great job of framing the complexity of the investor challenge, with financial success being more about how we act than what we know. The book emphasizes that financial decisions don’t happen on spreadsheets, but in dinners with family or, of course, in meetings with a trusted financial advisor.

In decision making moments, investors may be processing investments on an emotional level. This can be rooted in their financial experiences while growing up, past investment decisions, near-term financial objectives, and current market conditions. Connecting clients to investments that make sense based on their unique profile, objectives and risk tolerance, will require more than a spreadsheet. Investors and FAs ideally need a strong relationship based on trust and empathy. And even more fundamentally, the time needed to build one.

With that said, let’s look at the reality for advisors. The need to spend more time with current and potential clients is not a new challenge. What is new, however, is the growing demand for financial advisors to address investor concerns over some pretty substantial unknowns, including market volatility and swings, as well as the emerging Great Wealth Transfer.

In addition, advisors are facing an increasingly fragmented set of software systems needed to manage the needs of clients while staying compliant and responsive. With this kind of pressure, it is no wonder advisors are both retiring and failing at record rates.

Clearing the way to deliver great advice.

In our last blog, Operational Efficiency for the Back Office: The Time Is Now, we discussed ways wealth management teams can potentially find hundreds of hours each year, just by driving operational efficiency in areas like client onboarding, account oversight, and certain compliance-related tasks. With those hours reallocated to client engagement, advisors can spend more time tapping into the emotional concerns related to making investment decisions. But what do those conversations look like? And what tools are available to advisors to further reduce the friction to aid clients in taking financial action?

Having a strong foundation for offering investment options to clients is the key to further strengthening relationships, and ultimately increasing profit margins.

Here are three client-facing ways we believe can improve the customer journey and reduce the friction in taking financial action:

Offering the right products based on wealth complexity. Once a new account is open, it may feel like the hard work is over. But choosing the right allocation of assets for a new client is where the relationship building and trust begins. A modern managed account platform should offer targeted models that can also be blended to quickly meet a client’s needs. SigFig’s Digital Advice Pro has made this possible in approximately 10 minutes, versus the roughly 35 minutes that it might take in a more traditional process or platform.
Reinforcing confidence in the model options available. Giving financial advice is a huge responsibility, especially in markets with known uncertainty and inherent risk. Advisors may be better positioned to perform better for their clients when they have confidence in the models they are recommending. SigFig’s Digital Wealth Platform offers a second layer of model due diligence. By reviewing and researching all of the models and portfolios being offered, our platform is designed to save significant time for financial institutions and help increase the speed and confidence of advisors as they make their recommendations.
Knowing that reassurance that is just a click away. More often than not, a client’s need for financial advice will happen outside of an annual review. One of the best ways to reduce friction in financial action is to make connecting with a financial advisor spontaneous and easy. With SigFig, your advisors can be a click away with remote engagement tools to enable clients to fund their investments and make decisions in the natural course of life. Advisors can hop on a virtual interaction through SigFig Engage, loaded with embedded tools like Docusign to reduce client hesitation or uncertainty by demonstrating tradeoffs in the moment.

Technology cannot change the fact that most financial decisions have an emotional component. But the right technology can enable advisors and their clients to get to the heart of their financial choices, and make them with greater confidence and less friction. Getting this right can unlock real potential for financial institutions to retain both advisors and clients and increase the potential for improved financial performance.

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Wealth Management’s Road to Financial Wellness – Web Seminar Takeaways

Lauren Jarvis — Fri, 23 Jun 2023 14:42:09 +0000

Last week we had the privilege of gathering with leaders from some of the industry’s largest wealth management firms for our web seminar, Modernizing Digital Wealth to Deliver Financial Wellness: SigFig’s Vision and Roadmap. In our time together, we not only had a chance to share SigFig’s unique view on modernizing digital wealth, but gained a collective view of the group’s priorities through a series of live polls conducted throughout the session.

Here are some highlights of what we shared about the migration towards a financial wellness model:

1. Increased consumer demand for financial wellness.

Wealth management is playing a more prominent role for a growing number of consumers. No longer just investment strategies for high net worth clients, the mass affluent are looking for a form of investment guidance that enables them to achieve financial wellness across their entire journey.

2.Financial wellness is a process, not an event.

Winning the emerging mass market will require a focus on goals, life events, getting to know consumers and what would make for good and well-timed financial advice. This may not be aligned with the more siloed product focus (i.e., banking, mortgage, insurance, etc) in many financial institutions.

3. Financial institutions are seeking new delivery models.

To compete for the growing demand for this new kind of financial advice, financial institutions—banks and credit unions, wealth management firms, and insurance companies—are looking for ways to modernize their approach. They are considering how they collaborate internally, to how and when they interact with customers – ultimately to reduce the friction for clients to take action.

4. Technology is accelerating model overhaul.

Technology is making it possible to move away from a rigid model of people pushing products in branches to a fluid model that identifies and responds to natural behavioral triggers. Putting information at the fingertips of customers and wealth managers enables personalized advice and experiences – when, where and how they want it – incorporating human interactions when it matters most.

5. A financial wellness model has 4 key pillars.

As companies look to modernize and migrate to more of a financial wellness model, they need to plan around four key pillars: integrated financial services with personalization, advice that drives outcomes, screen-based collaboration that leverages human relationships, and modernizing planning. These pillars working together make it possible to organically welcome new and a more diverse set of investors into your practice over time.

Not surprisingly, the polls throughout our session showed strong interest in headline grabbers, like AI.

But the session also confirmed our suspicion that basic “blocking and tackling” are still top of mind among executives as they pursue becoming the financial management partner of choice for an increasingly diverse population.

Future roadmap planning showed a demanding “all of the above” strategy. 50% of participants said they were focused on all four strategic priorities listed – offering a goals-based planning experience for your customers, optimizing account opening, enabling advisors and clients to collaborate virtually, and serving the mass affluent investor efficiently. The remaining were singularly focused on goals-based planning (38%) and optimizing account opening (13%).
Personalization and effective advice rise to the top. Of the 4 pillars of financial wellness discussed in the session, the two most important to participants were integrated financial services with personalization (40%) and advice that drives outcomes (30%), followed by screen-based collaboration leveraging human relationships (20%) and modernizing planning (10%).

Do you have wealth management priorities that didn’t not come out in these conversations? We welcome the opportunity to connect and hear your perspectives on the current and future wealthtech landscape.

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[On Demand Web Seminar] It’s Not Monopoly Money: The Adoption of AI for Wealth Management

Lauren Jarvis — Wed, 07 Jun 2023 20:52:00 +0000

[Web Seminar] It's Not Monopoly Money: The Adoption of AI for Wealth Management

View the recording of our thought-provoking virtual event on the adoption of AI for wealth management.

Mike Sha

CEO, Co-Founder

Mike has held senior roles at Amazon, and has led SigFig to a focus on the advisor and client relationship

Dan Mercurio

Chief Revenue Officer

Dan has spent nearly two decades in leadership roles in the retail banking industry, focusing on digital transformation

Explore the transformative power of AI in wealth management and its real-world implications.

Gain insights from industry experts and discover how AI can revolutionize your financial institution. We spend time on the questions we are not asking but should be, as well as the critical junction of preserving human and tech harmony.

We Explore

What’s keeping you up at night? What questions would you ask a crystal ball? We explore these areas and more:

The potential impact of AI in wealth management

Transforming human expertise and contextual understanding
Mitigating unforeseen risks and bias that could form from AI
The power of building trust and establishing long-term relationships with clients
Preparing for the next wave of innovation

Thoughts from Fintech Meetup 2023 in Las Vegas

Kerry O'Keefe — Mon, 22 May 2023 17:30:42 +0000

Listen to Chief Product Officer, Amanda LaFerriere, and Chief Revenue Officer, Dan Mercurio, share their insights on Fintech Meetup themes, or read the summary below.

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If you attended Fintech Meetup, you likely speed dated for networking, maybe pet an emotional support animal or two, cruised through the elaborate exhibit halls, or attended sessions hosted by thought leaders.
Our team spent time doing all of these things, then found ourselves gravitating towards a few themes and threads we consistently encountered. Below you will find adapted content from Amanda and Dan’s musings after the event.

Eliminate redundancies through partnership.

While we attended, we were in the middle of a possible banking crisis. Silicon Valley Bank had just collapsed, putting a spotlight on banks and efficient operations. Much of the conference focused on this idea of eliminating redundancies through a myriad of ways, largely through some form of partnership. As Dan shares, “Over the past five years or so, the talk track around partnerships has absolutely changed. At one point in time it was, “Do you partner?” and I think now for firms large and small, it’s no longer a conversation of “do you partner,” it’s “where do you partner?”

You’re going to partner, so what should you look for in a Fintech partnership?

During one panel featuring leaders from The Financial Brand, Citi, Wells Fargo, and Huntington National Bank, they talked about the “4 s’s” to consider when picking a fintech.
Speed: Are there partnerships that can be executed that allow you as a firm to get to market more quickly than if you were to build it yourself?
Scalability: Does this partnership allow you to scale a business or scale a segment strategy in a way that might not have been possible?
Service: Is the fintech with you for the long-haul? Do they have your backs after you sign on the dotted line?
Security: Security is table stakes, so the fintech partner you choose needs to be able to drive forward meaningful advancements, following compliance and regulatory execution from a risk management standpoint.

Amanda summarized that, “A fintech partner should talk to you about their 3 to 5 core capabilities. And then you reflect on this and say, are these also our core capabilities? If those capabilities are outside your wheelhouse, ask, “Does this firm get my customer segments, do they understand my mission and culture, and can they immediately add value – If yes, then this is who you partner with.”

Founders and startups continue to drive innovation.

It was invigorating to see and learn from a number of founders that have a lot of passion around what they’re building and what they’re starting. We saw firms focused on innovating wealthtech, payments, and a lot around digital identity.
Amanda shared her insights related to the startups and SigFig’s product strategy. “We strongly believe the new path forward for digital advice will combine human advisors with robo-technology to create more streamlined digital experiences for clients across multiple segments. While there is still a space for digital-only solutions, we see an emerging middle space in serving mass affluent customers that prefer a technology-led approach but still want the touch of a human advisor. You know, we are helping our financial institution partners leverage our robo-technology platform to build advisor efficiency and effectiveness to reach this fast growing segment through a hybrid approach, blending technology with human advice.
We see tremendous growth potential for this model going forward, particularly with the next generation of affluent investors. It’s no longer just about relationships on a golf course.”

So what does the future of financial advice look like?

In the near-term, the future is going to be utilizing technology to improve the segmented service model for both advisors and clients. We’re talking to a lot of leaders about questions like, “How do we position advisors differently? How do we give the home office a little bit more P&L control? How do we still have a great advisory experience, but offer a digital-only backup if the client isn’t ready for a conversation?,” Dan mused.
Amanda chimed in, “I agree—We want to help our partners find value in serving that middle segment of mass affluent investors and so we suggest focusing on efficiency. The opportunity to combine behavioral data with account data to drive an action that has positive outcomes for clients is still largely untouched. Because wealth management requires having a clear understanding of a client’s goals and risk tolerance, it allows us to build solutions that answer questions like,”How do we help large firms with hundreds, maybe thousands of advisors, really nurture folks at the right time?”
You know that client of yours has a son who’s going to kindergarten—how do firms like ours facilitate a nudge campaign that reaches out and asks if they’ve got any child care savings?”
Last, but not least, generative AI and LLMs will play a big role in the future of wealthtech. Finding ways to enhance customer service, improving advisor efficiency or identifying new asset opportunities in real-time, the areas for these tools to add value are vast. We continue to plan and invest in this topic and how it can help our partners achieve their strategic objectives and provide a better client experience.
If we missed seeing you at Fintech Meetup, we welcome the opportunity to connect and hear your perspectives on the current and future wealthtech landscape.

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[On Demand Web Seminar] Modernizing Digital Wealth to Deliver Financial Wellness

Kerry O'Keefe — Mon, 15 May 2023 20:03:45 +0000

[Web Seminar] Modernizing Digital Wealth to Deliver Financial Wellness: SigFig’s Vision and Roadmap

Hear insights from our May Partner Advisory Council meeting informing how SigFig helps power their strategic digital wealth goals.

Mike Sha

CEO, Co-Founder

Mike has held senior roles at Amazon, and was one of the original inventors of Amazon’s Prime program

Amanda LaFerriere

Chief Product Officer

Amanda specializes in the intersection between financial products, design & CX

Dan Mercurio

Chief Revenue Officer

Dan has spent nearly two decades in leadership roles in the retail banking industry

Roger Fong

Chief Technology Officer

Roger has spent over a decade leading the engineering function at SigFig

We want to help you provide advisor efficiency, market reach, and customer value

Financial services—and indeed, the world at large—have undergone a dramatic shift this year. And financial institutions require a modern platform to grow clients and assets more effectively and efficiently for mass affluent investors.

About the Web Seminar

Learn from Sigfig CEO Mike Sha, Chief Product Officer Amanda LaFerriere, Chief Revenue Officer Dan Mercurio and Chief Technology Officer Roger Fong as they discuss how SigFig’s platform approach provides:
A segmented service model by customer value
Omni-channel advice that drives outcomes
Digital onboarding, account opening & funding
Leading with wellness for every customer

Key Takeaways

The web seminar covered trends and insights learned at our 2023 May Partner Advisory Council meeting including:
Redefining product offerings by level of service, price, and the tools a firm utilizes to drive both analog and digital lead generation
What digital wealth technology trends/patterns we’ve seen recently, including the shift in distribution channels
How firms are defining success for both clients and financial service providers
Unlocking challenges advisors face and how this impacts SigFig’s work and product outlook

Read more from Sigfig CEO, Mike Sha, on industry trends to watch in 2023

Learn how FIs can offer more than investment advice by putting consumer needs at the center and taking screen-based interactions to the next level.

Learn More

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SigFig: Redesigned, Rebranded, Revisited

Lauren Jarvis — Mon, 15 May 2023 13:52:32 +0000

So, welcome. To our vibrant, functional new website.

Over the past 17 years, SigFig has evolved from a direct-to-consumer robo-advisor into a multi-faceted ecosystem of digital wealth solutions. We’re now an integrated software company providing wealth management teams with solutions to improve the client experience and empower financial advisors.
Our principal focus is on maximizing home office and provider efficiency and reach so they can spend more time on what matters. We power solutions for leading financial institutions such as Wells Fargo, Citizens, Santander, and Scotiabank.
As we have reimagined our own internal operations to continue driving innovation for firms and investors, we have simultaneously shifted the ways in which we help our partners meet evolving client needs, ultimately focusing on driving down the cost to serve across customer segments while adding back time for firms to deepen client relationships.
Our website is a combination of where we’ve come from, where we’re going, who we’re going with and how we navigate the future together.
In this constantly evolving landscape, we are inspired by the fact that change is the only constant.
The pace at which we consume information has increased. The options available to us are innumerable. And both fintech and wealth management continue to drive transformative changes across the financial services industry.
To thrive in this environment, we need to be adaptable and resilient. There are endless inputs—recognizing how to organize insights from distractions is essential to harness more disruptive ideas. By thinking beyond ourselves and focusing on the bigger picture, we become a driver of change, and enable financial institutions to drive innovative solutions for their advisors and clients.
At SigFig, we also have the benefit of being uniquely positioned to learn from our partners and understand what it takes to help them achieve their strategic objectives.
We know the best ideas come from working together and listening to diverse perspectives.
We are dedicated to providing a seamless, efficient, and personalized experience in everything we do—websites included. Our goal is that this new public identity facilitates meaningful connections with leaders across wealth management and enables new ideas for our industry.
We encourage ideas, feedback and coffee dates. We hope to meet you soon.
The SigFig Marketing Team

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New Opportunities to Drive Advisor Efficiency and Client Experience: Lessons Learned from Robo-Technology

Lauren Jarvis — Mon, 24 Apr 2023 15:35:52 +0000

New Opportunities to Drive Advisor Efficiency and Client Experience:

Lessons Learned from Robo-Technology

Download now

There has been a lot of speculation recently about the future of robo-advisors.

News headlines question whether recent M&A activity signals that future expansion of robo- or digital advice is slowing. Despite these somewhat ominous headlines, robo-advice continues to grow at a healthy pace. In our recent roundtable discussion on emerging trends and opportunities in the digital wealth space, we discussed ways that the technology that paved the way for robo-advice is now being used to create new opportunities for financial advisors.
We strongly believe the new path forward for digital advice will combine human advisors with robo-technology to create more streamlined digital experiences for clients across multiple segments. While there is still a space for digital-only solutions, we see an emerging middle space in serving mass aluent customers that prefer a technology-led approach but still want the touch of a human advisor. We are helping our financial institution partners leverage our robo-technology platform to build advisor eiciency and eectiveness to reach this fast growing segment through a hybrid approach, blending technology with human advice. We see tremendous growth potential for this model going forward, particularly with the next generation of aluent investors.

How Robo-Advisors Are Making Wealth Management More Accessible

Over the last five years, assets under management at robo-advisors have increased from $300 billion to $1.66 trillion, and are expected to grow to 3.22 trillion by 2027.1
Further, in a recent study of nearly 1,600 Americans, nearly 2/3 indicated that they are open to using a robo-advisor to manage their investments, with millennials being the most open, with 75% expressing interest.

Reasons for Using Robo-Advisor

Now, Market Conditions Are Leading to New Opportunities for Robo-Technology

Even as robo-advice solutions gain market share, there is opportunity to reach a larger population of investors that prefer a human connection, particularly in more challenging economic environments like these.
A recent survey showed that about half of investors agreed that it’s better to work with a financial advisor when there is volatility in the market. According to another survey by Accenture, roughly a third of 1,000 respondents expressed that they would increase their investments with an advisor if they received a hyper-personalized experience. The percentage is higher with younger investors.

The Evolution of Robo-Technology: Empowering Advisors to Reach a Larger Audience

Omnichannel access is no longer just ‘nice to have.’ Digital is the most preferred channel for clients, closely followed by remote (including wealthier and older clients previously less digitally inclined).
Robo-technology can be leveraged to transform how advisors engage and service clients and open up new opportunities to expand their reach across multiple client segments and expectations.
By tapping into the same technology behind robo-advice, advisors can deliver all of the bene its of robo-advice to a broader universe of investors that want the option of a human touch, while firms bene it from being able to reach the rapidly growing mass affluent segment in a more efficient, economical way.

We see a wealth of opportunity in serving the emerging market of hybrid coverage, where investors that want and need a human advisor but don’t require the same degree of sophistication required for the traditional 1:1 advisory relationship served by field coverage.

According to McKinsey, one-third of mass affluent households ($250K-$2MM), are now using a hybrid
model, or using both automated technology and in-person advice to manage their investments, making it the fastest growing segment of affluent investors. The rapid growth is a result of two trends that are expected to persist: investors’ desire for human advice and the ease and affordability of direct investing.
On the left of the spectrum, investors just getting started or with smaller amounts to invest can be serviced by a fully digital direct experience, with “humanized” advice layered into the experience. This could be access to a team of advisors when they have questions and/or access to a robust library of educational content and well-designed automated communications.
Some firms are also considering migrating legacy advisory accounts that haven’t grown sufficiently to a fully digital experience to improve efficiency. Migrated accounts can save a firm 20 to 50 bps depending on internal cost and current service models. This is best done in a segmented phased approach, and may require new service models (virtual advice and client service teams) in order to successfully implement this strategy.

How Robo-Technology Can Help Advisors Improve Efficiency (or Save Time)

According to Cerulli, advisors spend more than 50% of their time on non-client facing activities like investment research, due diligence and monitoring, trading and rebalancing, and managing day-to-day operations.7 SigFig can greatly improve efficiency in the majority of these areas by incorporating automation and other tech-enabled functions into your firm’s new client onboarding and servicing processes.
The more efficient the business, the lower the fees charged to clients, which can increase the size of your prospective client pool. By leveraging technology and automation, the advisor can be more “hands off” with service and administration, and provide more clients the personalized service they are looking for, at a reduced cost.
Fintechs can help banks transform the way advisors interact with customers by automating work lows and streamlining the amount of work needed for onboarding, planning and monitoring. Onboarding can be particularly time-consuming with activities like meeting prep, account setup, and data entry. Advisors are often dealing with multiple systems that don’t talk to each other. The amount of time lost working across different systems can be staggering.
We estimate that SigFig’s technology can save over 30 minutes per account in onboarding and account opening by simplifying proposal development and investment selection and streamlining data low through a single platform, regardless of whether advice is delivered remotely or in-person.
SigFig also estimates that it can save an average of 20 minutes per account in annual maintenance by automating deposits and withdrawals, tax and statement requests, account updates and automating annual review compliance requirements.
Contact us for more details on how SigFig could help you reduce time spent across different parts of the customer lifecycle and improve margin.

How We Automate

SigFig uses technology to automate a variety of tasks behind the scenes in onboarding, investment management, monitoring and reporting to save advisors’ time, including:
Painless onboarding
Advisors can also lean on automation software to streamline mundane activities like onboarding new customers, completing forms and gathering needed documents. It can also help to reduce costly errors. A personalized portfolio is typically opened in less than 10 minutes.
Automated investment management
Features like automated daily health checks and automatic rebalancing can help manage an investor’s portfolio to align with their goals and risk preferences behind the scenes, taking the burden of constant checks off of the advisor. Automated tax-loss harvesting can also be done behind the scenes to help limit the impact of taxes for clients, saving advisors time and energy.
An integrated client portal for transparency
Innovations in planning software allow investors and their advisors to consolidate holdings onto one platform to see their entire inancial picture in one place. Monitoring, research and goal tracking can be made easier.
Automated annual reviews and communication
Time savings from preparing and conducting annual reviews and portfolio updates empower advisors to reach more clients with personalized engagement and communication.
Convenient collaboration
The advantage of clean digital interfaces isn’t reserved for robo-advisory platforms. Digital customer experiences can be effective communication tools for traditional advisors too, facilitating client interactions and financial planning. And it’s not just a conversation, virtual conference solutions can help with walking through portfolio decisions, signing documents, aggregating data, etc.

Wrap Up

As servicing becomes more efficient, advisors can service more investors at a lower price point, and this opens up advisor-led service to many new investors that don’t want to pay the price of a 1:1 relationship. Virtual advice can transform the way that the mass affluent audience is served. It saves time for both the advisor and client, provides convenience, and allows for collaboration during discovery and planning, unlocking the capacity of the advisor and extending their reach.
Connect with us on Linkedin or via marketing@sigfig.com to learn more about our products and how we power some of the largest financial institutions in the US and Canada to deliver a modern advice and service experience.

The post New Opportunities to Drive Advisor Efficiency and Client Experience: Lessons Learned from Robo-Technology appeared first on SigFig.

How Advisors Can Leverage Technology to Win The Great Wealth Transfer

Lauren Jarvis — Wed, 22 Mar 2023 13:15:26 +0000

There is no shortage of opinions on The Great Wealth Transfer. Whether you see it as an opportunity or a threat, there’s no doubt that it will shake up the financial services industry. Within the next two decades, an estimated $84 trillion will be passed down to charities and younger generations — e.g. Millennials and Gen Xers —from their parents and grandparents.

While Gen X, Millennials, and Gen Z are destined to be the biggest beneficiaries of the Great Wealth Transfer, so too are their preferred financial providers. The ability for financial advisors to capture and maintain these assets in movement will depend on how prepared they are to address the needs of newer generations.

As a fintech company focused on innovative digital wealth solutions, SigFig is uniquely positioned to help advisors compete for this transfer of wealth by helping to free up advisors’ time and provide more seamless customer experiences that leverage innovations in technology.

The Shift in Assets is Beginning

According to Federal Reserve Board data, Baby Boomers (born 1946–1964) and, to a lesser degree, the Silent Generation (1945 and earlier) control 65% of the nation’s wealth — or roughly $88 trillion.

Traditional banks have long enjoyed a firm foothold with these older investors. According to a recent EY survey of more than 5,000 consumers, wealth managers and banks (national, regional, and digital) are considered the most trustworthy financial brands by the majority of individuals above the age of 65 (57%). That holds true for the 55-64 age group (51%) as well. However, there’s a definitive shift among younger cohorts, with 51% of Gen Z and 49% of millennials naming a FinTech as their most-trusted financial brand.

Source: EY

While traditional banks have the advantage of incumbency and can offer several advantages to these soon-to-be wealthier households, heirs and beneficiaries of the Great Wealth Transfer won’t necessarily trust their new-found windfalls with their parent’s financial advisors. In fact, many reports have shown that up to 80% of heirs end up switching advisors. To win or maintain these assets, advisors will need to show that they can support the needs of younger generations.

Fintechs Continue to Gain Market Share Among Younger Investors

Digital-only banks are positioning themselves among long-standing market leaders. According to a report by Galileo Financial Technologies, while Baby Boomers and Gen X hold most of their funds in a traditional account, Millennials and Gen Z approach their finances differently, keeping 56% and 53% of their funds in some form of digital or prepaid account, respectively.

It’s a trend that is growing. A recent study by PYMNTS.com shows that 57% of millennials and bridge millennials are extremely or very interested in using a digital bank in the next 12 months. The primary reason provided for considering the move to a digital bank was access to improved transfers, with 43% of consumers saying that this is their greatest motivator. The study showed that Millennials are also interested in digital banks because they perceive digital banks to be more secure and provide earlier access to the newest technologies.

Younger Generations Expect More Personalized Guidance

Younger generations are looking for a more holistic and personalized approach to their financial needs and expect their advisor to be aware of their financial situation.

FIntechs offer the promise of more cutting edge technology, leveraging machine learning and artificial intelligence to present only those solutions that are relevant.

According to an Accenture survey of 1,000 investors, 91% of respondents valued being heard and understood by their advisor above everything else. On top of that, roughly a third of respondents expressed that they would increase their investments with an advisor if they received a hyper-personalized experience. This is particularly true with Millennials and Gen Z.

How can advisors compete? The ability to deliver more personalized support will be an important differentiator moving forward. Advisors that leverage technology to automate onboarding, portfolio selection and day-to-day management can free up time to have more valuable conversations with new clients and prospects. Investing time in providing education for clients will also become increasingly important to win new business and retain assets.

Leveraging Technology Will Be a Key Differentiator

A recent Cerulli study revealed that advisors spend more than 50% of their time on non-client facing activities like investment research, due diligence, monitoring, trading and rebalancing, and managing day-to-day operations. Technology can save advisors time by incorporating automation and other tech-enabled functions to streamline much of this work, so that advisors can spend more time building relationships and expanding the scope of advice they deliver.

Features like automated daily health checks and automatic rebalancing can help manage an investor’s portfolio to match their goals and risk preferences behind the scenes, taking the burden of constant checks off of the advisor. Automated tax-loss harvesting can also be done behind the scenes to help limit the impact of taxes for clients, and save advisors the time and effort of sorting through multiple transactions.

SigFig’s automated platform can also streamline new client onboarding, helping to reduce the time spent on mundane activities like completing forms and gathering needed documents. A personalized portfolio can be opened in less than 10 minutes.

This frees up more time for advisors to get to know their clients and build relationships.

Education Will Become Increasingly Important to Win New Business and Retain Assets

Clients are looking for more than just basic portfolio advice. According to Accenture’s recent survey, clients expect their advisor to help with their complete financial picture, including advice on banking, insurance, and taxes. Specifically, 85% of Generation X, 91% of Millennials and 97% of Generation Z expect such services from their advisor, compared to only 47% of Baby Boomers.

Settling and managing an estate is often a lengthy, complicated process — and the larger the estate, the more complex it will be. The firms that are able to guide younger generations through this financially challenging time and establish enduring relationships will be well positioned for the foreseeable future. Building education support for more complex planning topics, including how to manage the impact of taxes, setting appropriate investment goals and succession planning will become increasingly important.

Additionally, providing guidance on personal finance topics outside of investing like budgeting, improving credit score, and insurance planning can help build a younger client’s financial literacy and establish trust. Being an advocate and a source of truth to help them navigate a variety of financial decisions can help reduce their stress and strengthen your relationship.

The Advantages of Partnering with SigFig

SigFig’s Digital Advice and Digital Advice Pro products can help advisors save time by automating some of the work of day-to-day management, while also offering advanced collaboration solutions. For example, SigFig Engage allows an advisor to meet with multiple people simultaneously or separately around the same accounts for planning.

The Great Wealth Transfer will shape the financial services industry for decades to come. Advisors that incorporate more technology into their business will have more time to spend with clients to offer personalized service and set themselves apart.

Connect with us on Linkedin or via email to learn more about our products and how we can help you.

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