The key ingredient to building a successful wealth management practice is access to data, the head of a software company has said.
Speaking at the Institute of Public Accountants 2017 National Congress on the Gold Coast last week, myprosperity chief executive Chris Ridd told delegates: “[A recent industry report said] we think the wealth providers of the future are going to become data custodians.
“They’re going to be able to provide a vast range of client network information and offer responsive solutions and it’s all about providing advice around financial and non-financial goals.”
According to Ridd, financial advisers were not yet equipped with the information they needed to deliver great advice.
However, he pointed out that while he was emphasising the importance of data in the immediate future, it did not mean automation would eliminate the need for financial advice provided by humans.
“Our view is the world still needs advisers, but they need the data,” he said.
He explained the type of data he was referring to was data pulled together from all parts of an individual’s life that would let financial advisers get an understanding of a client’s entire wealth predicament to allow advice to be provided for all their needs.
“Gone are the days where you have a very strong product affiliation where [the adviser says] ‘I’m going to push a product to my client’ [because clients are saying] ‘I actually want you to focus on my wider life goals’,” he said.
He noted a recent encounter with an adviser to illustrate how this process is already taking place.
“I actually ran into an adviser down in Melbourne who is using myprosperity and looking holistically at their clients, but he’s gone a step further,” he said.
“[He told me] we’re actually providing advice and counselling around mental health issues as well as relationship breakdowns.
“I’m not suggesting you all go out and start doing that, but isn’t it interesting when you think about the role of the adviser and looking at wider life goals. I think these are really interesting developments.”
