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03 March 2021

Adding Value in a World of Free

What happens when the typical costs and fees in your industry get compressed by technology innovation? Our whitepaper, Adding Value in a World of Free: The New Paradigm for Financial Advisors, details the trends driving down cost in the wealth management industry and explores how advisors can take advantage of technology to visibly and measurably differentiate themselves.

When trading commissions went to zero in late 2019, the retail brokerage industry was completely re-arranged, with smaller players being acquired and new mobile-based upstarts moving into prominent positions. This movement to “free” has escalated to other competitive offerings from technology-enabled players who could offer a value proposition similar to that of an advisor – investment advice and financial planning. 

As a result, advisors have the opportunity to re-enforce the value they provide clients by showing their work and better communicating how they are helping investors beyond just commoditized investing and free trading. By “un-commoditizing” these free services, advisors can instead document how they have changed financial behaviors and coached their clients on ways to avoid mistakes, manage complexity, and lower taxes. Most importantly, advisors can remind clients they are there for them in times of volatility and uncertainty – two things that are in high abundance right now.

To provide customization at scale, advisors need to embrace technology to communicate personally and regularly with clients. Leveraging digital tools such as a powerful client portal enables clients to view their portfolios, complete tasks, track their progress, ask questions, and voice concerns with their advisor at their convenience.

Additionally, advanced rebalancing technology provides advisors a highly effective way to again show their work and document the savings they are achieving for clients through a scalable tax sensitive approach and sophisticated tax-loss harvesting, which has the potential to add up to tens of thousands of dollars every year. This can be a powerful way to showcase the value a client receives for paid professional advice. Advisors can further differentiate themselves by showing clients how they can accommodate ESG considerations and by using direct indexing to build customized benchmark-tracking portfolios.

Ultimately, it is in turbulent times that advisors can seize the opportunity to turbo-charge their businesses with a differentiated marketing message that showcases the value they are providing. To support you in this important endeavor, the Black Diamond® Wealth Platform has many of the components you need, including a Client View dashboard, an intuitive Client Experience portal, a robust Relationship Timeline, and an award-winning Rebalancer.

To learn more about how you can best manage your business in a world of free, download the complete whitepaper today.