October 25 – 27 Join us online at the 2021 eMoney Summit from October 25 to 27 as we explore how to provide an authentic planning experience that’s as unique as each of your clients.

Welcome to
Heart of Advice

a new source of expert insights for
financial professionals.

Get Started

Tips specific to the eMoney platform can be found in
the eMoney
application, under Help, eMoney Advisor Blog.

eMoney Logo
Magnifying Glass Icon
Mobile Menu Icon Close Mobile Menu Icon
Arrow Icon

Heart of Advice

Insights and best practices for successful financial planning engagement
Learn more

Back to All Articles

Explore Our Categories

Webinar: Setting Marketing Goals for the Win - Our research uncovers how the best firms are maximizing marketing ROI. Thursday, August 17 at 2pm EST.

REGISTER NOW

Empowering Holistic Financial Planning Through Data Aggregation Technology

Scott Cognato April 16, 2020

Financial planning is rarely one size fits all. Every client is unique, with a variety of personal goals and challenges to overcome and achieve. A strong financial plan should always begin with a complete understanding of an individual’s overall financial picture. However, obtaining all client data can be a challenge.

Most clients have non-advisor-managed accounts such as 401(k)s, checking or savings accounts, and credit card accounts. Access to this information presents a challenge for an advisor who wants to practice holistic planning—they have limited visibility into those assets held away, and in turn, the client’s complete financial picture.

How Can Advisors Start to Practice Holistic Financial Planning?

Holistic financial planning requires a top-down approach to planning, where the advisor and client identify goals and then talk about how to reach them. Instead of just plugging data into a calculator and saying “this is how much you need to retire,” comprehensive planning relationships cover other things, such as what the client hopes to do in retirement or where they hope to live, and then creates a plan tailored to those considerations.

Today, more and more advisors are taking this approach to planning because it helps them create longer, more productive client relationships built on understanding, value, and trust.

One way to create financial plans based on a client’s whole personal and financial picture is through data aggregation. Financial data aggregation involves collecting financial data, like 401(k), checking, savings, and investment account balances, and presenting it in a consolidated fashion within a secure electronic environment, like planning software, where the advisor and client can access it within the context of their relationship. Essentially, data aggregation is the engine that creates the complete financial picture an advisor needs to create accurate plans based on real-time data.

Where Do APIs for Financial Planning Come in?

Today, institutions and technology vendors use several methods to aggregate client financial data. One of the most popular and secure methods involves using Application Programming Interfaces, or APIs. APIs allow two systems to interact and connect with each other in a secure way to create a streamlined flow of data that allows one of the systems or an end-user to complete actions without having to go back and forth between two websites.

Basically, APIs allow the end user to view their financial information such as account balances, without requiring them to log into their bank account website. Think of APIs as offering ongoing, “view only” access to account data. The API is built into the system, so the advisor and client never see it or interact with it. Not only do APIs keep the user experience clean and concise, but API-based data aggregation tends to be more secure and reliable than other methods.

Financial data aggregation is increasingly important in wealth management and APIs have become the preferred method of aggregation—they offer greater accuracy and empower advisors to practice holistic financial planning to create deep, lasting relationships with clients. When advisors leverage API technology to support their planning process, they’re adding additional value that only strengthens relationships over time.

To learn more on this topic, watch our on-demand webinar on data governance below. eMoney leaders will discuss security best practices, current legislation, and what you can do to implement a culture of data governance in your organization. 

About the Author

Scott Cognato is a Senior Technical Product Manager at eMoney. As a PM, he focuses on continually improving the best of breed Aggregation system, from architecture to end user experience, so that advisors and their clients don't need to. Scott's professional passion is to de-jargon FinTech and make even the most technical problems approachable to anyone interested. Outside of the office, Scott is an outdoor enthusiast, and can often be found mountain biking, road biking, or hiking throughout the Sierra Foothills he calls home with his family, friends, and Husky named Wolfy (his adopted name that fit too perfectly to change!).

You may also be interested in...

big data for financial advisors

Six Ways Financial Professionals Can Leverage Big Data to Make a Big(ger) Impact

It’s no secret: Behind every decision, purchase, and marketing program is a powerful data stream, and many times, some form… Read More

The ROI of Financial Planning Software

As more and more financial service firms strive to adapt to a digital environment and the evolving client demands for… Read More

Maximizing Adoption of Planning Technology

In 2020 financial professionals and consumers across the country were forced to conduct all facets of work and life at… Read More

CE Webinar: Tax Legislation Projections in a New Era: Mid-2021 Updates (1 CFP® CE Credit)

In this session we will provide updates on what has changed since the beginning of 2021, what has stayed the same, and proposals for the longer term. Thursday, August 5 at 2pm EST.

REGISTER NOW
CE Webinar: Tax Legislation Projections in a New Era: Mid-2021 Updates (1 CFP® CE Credit)

In this session we will provide updates on what has changed since the beginning of 2021, what has stayed the same, and proposals for the longer term. Thursday, August 5 at 2pm EST.

REGISTER NOW

Sign up to have the most popular Heart of Advice posts delivered to your inbox monthly.

Sign up to have the most popular Heart of Advice posts delivered to your inbox monthly.

Heart of Advice by eMoney Advisors

Welcome to
Heart of Advice

a new source of expert insights for
financial professionals.

Get Started

Tips specific to the eMoney platform can be found in
the eMoney
application, under Help, eMoney Advisor Blog.