The tools of financial planning professionals like a certified financial planner or wealth management experts in Delhicomprised typewriters, adding machines, pens and reams of paper. The work was time- and labour-intensive, limiting the number of clients a planner could effectively service. Most professionals created their own analytical tools using spread sheets and, over time, proprietary software. Today, the number and type of tools available are outpacing their adoption. Over the last 10 years, some of the most significant advancements have occurred in financial planning software, innovations that are changing the business of financial planning. Financial planning is an important service that enables advisors to demonstrate their value to their clients. As the CRM is the “business hub” of the advisory firm, financial planning has become the “value hub.” Financial planning software companies understand this opportunity and have conceived new paradigms and greatly improved the existing ones. Current financial planning software is ahead of what advisors have been able to absorb. It is a great time for advisors to review what is available and what is already on their computers. This innovation will only accelerate as financial planning companies create new and better ways for advisors to interact with their clients and operationalize the financial planning process. Everything is happening faster, with information available so quickly that decisions can be made more effectively. And it’s accelerated by the move to mobile. Investors are looking for personalization to access the information they want to see. More relevant real-time data is helping investors make better decisions.
Financial planning software typically has the most loyal following of any front-office application. Advisors tend to work with the same software for years, adapting it over time to meet their own needs and those of their clients. Originally, advisors tried to show their value by exposing the complexities of how planning worked. This has changed; goals-based planning is inherently simpler and more intuitive for planners. And, as integration becomes deeper and held-away data is aggregated, you are seeing goal information integrated from planning tools to the custodian’s statement.
The cost of financial planning software is also changing as the functionality increases, giving advisors more options than ever before. Established companies have held their prices and maintained their market share. However, the wholesale adoption of planning software by the broker-dealer community has meant that software is available at reduced rates and/or further subsidized by broker-dealer affiliated advisor firms. New companies are offering cost-effective solutions as they strive for market share. Some are unbundling their solutions, making software available in modules or widgets and selling them separately, so that advisors can purchase only the functionality they want.