Efficiency the primary driver for adviser technology adoption
Financial advice businesses have indicated they are willing to increase their annual expenditure on advice technology by more than a third to an average of around $216,000 a year, according to the latest research from Investment Trends.
The latest Investment Trends Adviser Technology Report, released today, has confirmed that advisers are looking to technology to help them drive more cost-effective advice delivery.
And key to adviser interest in technology adoption is the pursuit of efficiency.
According to the 2022 report, compliance burden (65%), the ability to provide affordable advice (41%), and regulatory change (40%), continue to be the main challenges for advice businesses. As advisers turn towards using multiple technology solutions to support them, including Client Relationship Management systems (CRMs) and standalone modelling tools, they are expressing a greater need for integration between the systems they use.
Commenting on the research, Investment Trends research director, Dougal Guild said that affordable advice was a key concern across the industry, with advisers looking to technology solutions to support their ongoing compliance and client engagement.
“Greater integration can make a material difference and has also been proven to boost confidence levels,” he said.
The Investment Trends research also revealed that advisers face significant delays regarding the implementation of their advice, in a process often prone to errors.
It said two-thirds of advisers say they would use an end-to-end solution to minimise the delays and errors currently occurring between advice delivery and implementation. Accordingly, advisers believe planning software providers are best placed to be able to deliver this solution.
“It’s encouraging to see advisers’ rising adoption of technology solutions, however with this comes an increasing need for greater integration and standardised industry solutions to increase practice efficiency while minimising the time spent on compliance,” Guild said.
The study found that with more advisers turning to technology to help combat their many challenges, they are intending to increase their practice’s current annual spend on technology from the current estimated average of A$146,000 to A$216,000.
“It’s assuring to see advisers’ rising adoption in technology solutions and intentions to increase annual spend on these solutions going forward, making the advice preparation and implementation process more streamlined and effective,” Guild said.
The only way to sensibly & affordable drive efficiency in Advice to is at least halve the massive BS over compliance and stupendous amount of 8 different regulators wanting different rules applied.
No amount of technology spend can fix moronic Govt mass Over Regulation & 8 different Regulators !!!!!
Please stop looking for hidden efficiency’s when every Adviser knows how easy it should be to be more efficient with half the bloody Govt Rubbish Regs.
Unfortunately only a small amount of this tech spend is being used to improve financial advice. Most of it is used to manage the burden of bad regulation. It is an utterly wasteful and unnecessary spend, that forces up costs for consumers with no additional benefit. However it does make good profits for “fintechs”, which is why so many of them are supporters of maintaining bad regulation.
The fact that $216,000 is the figure which is considered necessary to be efficient shows why financial planning as an industry is dead and buried. Other occupations have a much better risk / return ratio and without major change this will continue to be reflected in reducing adviser numbers.
Who the hell is spending $216k on tech unless you are a mega practice? $21,600 maybe