Our research continues to support investors’ desire for personalized financial planning. Every client has unique goals, circumstances, and aspirations, and tailoring financial strategies to their specific needs is crucial for success.

This is where the power of data comes into play. The effective use of client data allows financial professionals to gain invaluable insights and create highly personalized financial plans that resonate with each individual client.

Leverage Technology to Customize the Financial Planning Process

Advancements in technology have revolutionized the way client data is collected and managed. Digital platforms, such as client portals and aggregation tools, streamline the gathering of essential financial details during client onboarding and facilitate seamless information exchange and communication.

Enlisting technology to harness the power of client data offers numerous benefits for clients and financial professionals, including improving the client experience, uncovering opportunities, and broadening services to offer a holistic planning approach.

Enhancing the Client Experience

Personalization helps ensure clients have a positive experience working with their financial planner, while technology offers numerous ways for planners to analyze data and further enhance that experience. Several data views can help you improve your client experience.

Demographic Analysis

When conducted by financial professionals, data analysis provides a means of segmenting clients by age group, gaining insights into the generational composition of their client base. This understanding enables the development of hyper-personalized experiences that cater to the specific needs of each generation, ensuring every client feels understood and valued.

Engagement Tracking

Another powerful tool for planners if engagement tracking. Monitoring client portal logins over time reveals the most actively engaged clients. Reaching out to these individuals provides valuable feedback on what they appreciate most about the portal, allowing financial professionals to replicate successful strategies and improve engagement across their entire client base.

Scenario Analysis

Our clients are looking for peace of mind for their financial future. By tracking which clients accessed their plan to explore hypothetical situations, financial planners can identify opportunities to discuss these scenarios in greater depth, providing clients with a sense of preparedness for various contingencies.

Website and Presentation Tracking

Financial professionals can increase the adoption of client websites by identifying and personally inviting those who have not logged in, using the website as a platform for communication and information sharing. Similarly, tracking presentation creation enables planners to identify clients who have not yet received a comprehensive financial plan, presenting an opportunity to re-engage them in the planning process.

Uncovering Investment Opportunities

One of the key advantages of leveraging client data is the ability to uncover new investment opportunities. By segmenting and analyzing assets held away from your firm, there are several ways you can identify where the offer of personalized advice can potentially bring those assets under your management.

Segmenting Assets Held Away by Account Type

Sort clients’ assets held away by account type, such as 401(k)s, IRAs, or taxable brokerage accounts. This segmentation can help target households that could benefit from a rollover or consolidation strategy. For example, if a client has multiple 401(k) accounts from previous employers, they could potentially benefit from rolling those accounts into an IRA under your management.

Identifying Top Holdings Held Away

Organize clients’ investment data by their top holdings held away from your firm. This analysis can uncover niche planning opportunities. For instance, if you notice that some clients hold a significant amount of highly appreciated stock in their 401(k)s, you could offer them specialized advice and strategies for managing concentrated stock positions, such as tax-efficient diversification or hedging strategies.

Segmenting Assets Held Away by Institution

Compile and analyze a list of your clients’ assets held away by financial institution. This information can help you understand where your clients have assets managed externally and allow you to identify any strategic advantages you may have over these competitors. For example, if you notice that a significant portion of your clients’ assets are held with a particular institution, you could research that institution’s investment offerings, fees, and services to highlight areas where your firm may provide a better value proposition.

Analyzing client data to uncover investment opportunities allows financial professionals to demonstrate their expertise which ultimately results in a greater share of wallet with existing clients.

A Holistic Approach to Client Management

Holistic financial planning incorporates a client’s total life and financial circumstances into their plan. Sorting clients by various parameters creates a means for analysis that can aid in holistic financial planning by uncovering opportunities beyond investment management.

Top Clients By Net Worth

The examination of net worth can reveal clients who may require specialized estate planning services. For high-net-worth individuals, proper estate planning is crucial to minimize taxes, protect assets, and ensure a smooth transfer of wealth to beneficiaries.

Liabilities By Account Type

Liabilities analysis provides a way to identify clients who could benefit from debt restructuring strategies. Asset-based lending or consolidating high-interest debt can improve cash flow and overall financial health. Financial professionals can offer guidance on managing home equity lines of credit or refer clients to specialized lenders for tailored solutions.

Insurance Policies

Every plan needs protection and insurance is another vital aspect of financial planning that shouldn’t be overlooked. Organizing insurance policy data enables proactive outreach to schedule conversations around policy anniversaries, ensuring clients remain adequately covered and policies align with their evolving needs. Sorting life insurance policies by type can also highlight opportunities for policy reviews, making certain clients have the right coverage at the right cost.

A comprehensive approach to client data analysis empowers financial professionals to deliver personalized, holistic financial planning services. Going beyond financial planning can strengthen client relationships, uncover new revenue streams, and position themselves as trusted partners in their clients’ overall financial well-being.

Maximizing Value Through Data

Leveraging client data is a game-changer for financial planners seeking to deliver personalized service, uncover new opportunities, and drive business growth. By harnessing the power of data analysis, financial professionals can gain a comprehensive understanding of each client’s unique circumstances, enabling them to craft tailored financial plans that address specific needs and goals.

Financial planners who embrace data-driven strategies gain a significant advantage in today’s competitive landscape. Implementing robust data collection and analysis processes leads to streamlined operations and improved efficiency, and ultimately drives business growth through increased client retention, referrals, and profitability.

For more on differentiating your practice using the power of client data, read our latest eBook, Precision in Planning: Creating Better Client Outcomes with Personalized, Data-driven Financial Planning.

DISCLAIMER: The eMoney Advisor Blog is meant as an educational and informative resource for financial professionals and individuals alike. It is not meant to be, and should not be taken as financial, legal, tax or other professional advice. Those seeking professional advice may do so by consulting with a professional advisor. eMoney Advisor will not be liable for any actions you may take based on the content of this blog.

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