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The RIA Tech Stack: What You Need to Deliver an Exceptional Client Experience

Brandon Heid December 27, 2023

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Navigating the ever-evolving landscape of technology can be a daunting task for financial advisors. A recent study highlighted that 75 percent of advisors express concern about staying abreast of tech changes and effectively managing their tech stack. Integration issues closely follow, with 73 percent sharing similar worries.1

Given the swift pace of technological advancements, piecing together a seamless experience poses a near-universal challenge. In this blog post, we’ll delve into the fundamentals of the RIA tech stack, spotlight commonly used advisor software, and introduce some promising new tools to keep on your radar.

What Is an RIA Tech Stack and Why Do You Need One?

Your RIA tech stack is the comprehensive suite of essential software solutions your business needs to offer an exceptional client experience. A powerful, cohesive RIA tech stack is critical for meeting soaring client expectations in the era of personalized, digital-first experiences.

But beyond simply meeting client expectations, there are numerous benefits that come with having an optimized tech stack: enhanced efficiency, increased ROI, streamlined services, and ultimately, superior client outcomes. It’s not just about what software you use—it’s about strategically assembling a tech suite that maximizes the value you deliver as an advisor.

So, what software does an RIA need? The answer lies in customization, tailoring your tech stack to your business’s unique requirements. Yet, industry trends also play a role—consider what software most financial advisors use for a roadmap to get started.

What Software Does an RIA Need?

For RIAs, there are three technology solutions that consistently see the highest adoption rates: customer relationship management (CRM) platforms (94 percent adoption), financial planning software (93 percent), and performance reporting/portfolio management (88 percent).2

Bar chart of financial advisor technology adoption by software type

Source: 2023 AdvisorTech Study

Each of these tools are able to execute a variety of tasks across essential functions of an advisor’s business, including financial planning, investment management, and maintaining client relationships. However, it’s important to note that they’re also adept at performing a number of secondary tasks adjacent to their core functionality.

For instance, CRM platforms extend beyond client management, incorporating functions like workflow support and notetaking. Some financial planning software solutions can handle specialty planning topics such as tax and estate planning, and may come with a client portal and account aggregation features. Performance reporting/portfolio management tools excel not only in tracking investments but can also support billing AUM fees.

It’s for this reason that tech stacks are typically built around the three core technologies and their specific capabilities.

Some secondary software solutions you may want to consider, depending on the capabilities of your core technology, can include:

  • Marketing software (email automation/scheduling, social media scheduling/automation, client communication, meeting scheduling/calendar solution, Zoom/virtual conferencing, website builder/CMS, etc)
  • Client portal
  • Productivity platforms (internal chat/collaboration, file management and sharing, task management)
  • Security
  • Custodial solution
  • Risk alignment platform
  • Compliance
  • Performance reporting
  • Proposal generation
  • Trading and rebalancing tools
  • Investment research
  • Document management
  • Specialty planning, such as tax planning, estate planning, social security, student loans, etc.
  • Workflow support
  • Note-taking
  • Aggregation and data-gathering

What Software Most Contributes to Improved Client Outcomes?

When creating your RIA tech stack, it’s important to also consider what’s going to most help your clients, both in terms of their financial goals and their unique personal circumstances.

Recent research shows that client portal technology in particular can drastically improve outcomes for clients in key areas such as motivation, trust, loyalty, overall satisfaction, number of referrals given, and more.3 In the chart below, tech-forward advisors represent those whose clients use the client portal most frequently.

Tech-forward versus tech-averse financial advisor comparison of client outcomes

In fact, as client portal use increases among clients, overall satisfaction rises significantly, especially among those who use their portal the most frequently.3

line graph showing major increase in satisfaction, trust, loyalty, and referrals for clients that use client portals the most

After you’ve established your three core components of your tech stack, it’s wise to pay special attention to the client-facing technology solutions you’ll deploy. A client portal will be one of the most visible and frequently used solutions by your clients.

To maximize the benefits of a client portal, it’s essential to first have in place a workflow for client engagement with client portals to encourage adoption. Then, you’ll want to make sure you’re using your client portal in a way that aligns with client expectations. Clients most desired features of a client portal include:3

  1. Allows them to see all of their accounts in one place
  2. Save time via automation
  3. Gives a more holistic view of their entire financial picture
  4. Allows them to communicate with their advisor more efficiently.
  5. Allows them to self-serve and explore without meetings

It’s important to note as well that a client portal is fueled by robust account aggregation, pulling in all of the client’s information digitally. This saves you and them time and keeps their data continuously up to date.

AI Tools for RIAs to Keep an Eye On

In the wake of ChatGPT’s 2022 debut, AI technology has begun to make notable strides within the financial advisory sphere. While true AI might still be on the horizon, machine learning-based tools are gaining traction in the industry.

Automated Proposal Generation Tools

Streamlining the proposal process, platforms like yourstake.org’s Advisor Core product and betterproposals.io leverage AI to automate proposal creation so you can quickly get in front of prospective clients. The Betterproposals tool features an AI assistant to correct mistakes and facilitate follow up. It can even analyze your proposal and provide recommendations for improvement based on live data from the advisory industry. This not only saves time but ensures you’re putting your best foot forward with potential new clients.

Optical Character Recognition (OCR) Technology

Tools such as fpalpha and holistiplan are at the forefront of OCR-based technology. By “reading” uploaded documents like tax returns, wills, trusts, and insurance documents, they swiftly generate document summaries and extract valuable data insights. This automation not only enhances accuracy but also expedites analysis.

Marketing-related AI

AI is reshaping marketing efforts with tools like catchlight.ai, a lead optimization tool that identifies a company’s most promising leads. Tools like saifr.ai facilitate compliant marketing content creation, adhering to both firm and industry guidelines. Another tool, Sybill.ai, takes a unique approach. It monitors Zoom calls, transcribing the meeting and providing follow-up actions based on the conversation. It can even measure engagement or friction points during discussions. These AI-powered tools contribute to more targeted marketing and efficient client interactions.

Moving Forward with Your RIA Tech Stack

As technology continues to evolve, crafting a resilient RIA tech stack remains pivotal. From core solutions with high adoption rates to secondary applications and the integration of AI advancements, your tech arsenal shapes the client experience you deliver.

Of course, it takes more than just investing in technology to differentiate yourself. How you deploy that technology towards your firm’s goals matters a lot. To keep learning, read our blog post Creating a Financial Advisor Business Plan: A Comprehensive Guide.

 

Sources:

1.       “2024 Connected Wealth Report: AI & the Next-Gen Advisor.” Advisor 360, 2023. November 29. https://www.advisor360.com/solutions/ai-connected-wealth-report.

2.       Kitces, Michael. “2023 AdvisorTech Study: The Technology That Independent Financial Advisors Actually Use and Like.” Nerd’s Eye View https://www.kitces.com/kitces-report-independent-financial-advisor-technology-fintech-software-tools-research/.

3.       eMoney Beyond the Plan Research, July 2023, n=504 advisors, n=1,003 end-client investors

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About the Author

Brandon is a Practice Management Consultant in eMoney's Financial Planning Group. In his role, he provides detailed assessments and recommendations for firms looking to enhance their use of the eMoney platform and incorporate interactive financial planning into their practice. He works closely with Sales, Training, and Relationship Management departments to assist prospects and active users, as well as develop internal talent. He helps coordinate eMoney’s University Program, working with instructors, program directors, and students in over 70 CFP Board registered programs across the country. Prior to eMoney, he spent time on both the institutional and retail side of TD Ameritrade, in multiple business development roles.

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