How to Leverage Robotech to be a Better Advisor


Robo-advisors, who provide satisfactory services at a much lower cost than their human counterparts, are more prevalent than ever. In fact, registered investment advisors currently manage around $5 trillion in assets, while robo-advisors now hold about $14 billion of those assets.
Even though it’s clear that technology can help investment advisors improve their services, few are taking advantage of the opportunity. Technology is saturating financial advisory firms at a much slower rate than it should be. In 2017, only 40% of firms regularly used technology, a small increase of 10% since 2014.
Instead of feeling threatened by the growing presence of robo-advisors and other financial technology, RIA firms should leap into action, leveraging new technologies to their advantage. Read on to discover how you can capitalize on available technologies to improve your business operations—and boost your bottom line in the process.

Delegate or Automate Tasks

Robo-advisory technology, or robotech, offers a wide variety of capabilities that can reduce the time you spend on trivial tasks. Some of these technologies can manage these tasks better than humans can. Examples of items that you can easily delegate to or automate with robotech include:

  • Asset allocation
  • ETF or mutual fund selection
  • Fee comparison
  • Investment research
  • Performance tracking
  • Portfolio mapping
  • Rebalancing and tax-loss harvesting

While robotech handles these tasks, you can focus on projects that require a human touch, like setting goals with clients, coaching client financial behavior, and managing critical life changes.

Expand Your Client Base

Robo-advisors appeal to younger generations, which are tech-dependent and less affluent than their elders. They often don’t need too much guidance; they just want low fees and an occasional nod in the right direction.
To make your services more attractive to these younger generations, offer guided robotech services that put most of the onus, like signing up, entering information, and tracking performance, on the user. While you should offer occasional guidance and some advice, this service should be a bare minimum offering so you can charge lower fees.
Because these services will cost less than your full financial advising, they will attract an entirely new client base and increase your overall revenue.

Expedite Client Operations

One of the barriers to new investors, especially those from younger generations, is the amount of in-office work it takes to open and manage an account. Today’s consumers want fast and easy signup and management processes.
When new clients can quickly enter their personal information—and details like savings goals—online, they are more likely to begin investing. Ensure your signup system is a user-friendly, online process. If possible, facilitate online access to your other services as well for continued accessibility.

Improve Transparency

Robotech provides transparency for both clients and financial advisors.
With easy-to-use apps, clients can track their investments and make decisions from their phones. This kind of accessibility increases customer satisfaction.
Robotech offers greater transparency when it comes to compliance and regulations, too. With a top-level view of account activity, you can easily ensure operations are up to code. Robotech can even notify you of changes or issues, empowering you to remedy potential problems or seize opportunities that might have passed before you could notice.

The Bottom Line

The increased presence of technology in the finance industry can be overwhelming, especially as more and more individuals turn to the lower cost of robo-advisors to manage their assets.
However, if advisors can capitalize on these technologies while providing irreplaceable human touches, like excellent customer service, they have a huge advantage over their robo counterparts. With technology as another tool in their arsenal, advisors who adapt will continue providing value to clients and growing their businesses.