Steve Andrews: How tech can help keep the next generation on the books

The differences in attitude between the new generation of the wealthy and how their parents managed their fortune is extremely evident today, raising a challenge for advisers when it comes to finding innovative ways of keeping the next generation on their books.

According to a report from Accenture, in the US alone trillions of dollars of wealth will transition between generations over the next 20 years. This is set to be an issue in the UK too, and managing this next generation wealth will need a next generation adviser approach.

Thinking ahead and putting necessary measures in place to ensure your services match the requirements of the next generation of client will be critical, and while looking forward let us not forget that boomers still have to be served too, which makes it challenging for advisers who may have to have multiple propositions and/or business models to serve all clients through a period of transition.

Working closer together with existing clients and building strong relationships with the heirs, hiring the 'next generation' advisers and ensuring adequate training will also be crucial, particularly when it comes to inheritance tax planning. That said, being more tech savvy will remain key in making sure that advisers keep the next generation of wealth on their books.

In an era of super-fast technology and instant communication, it is likely that the next generation will trust technology more than they trust humans. Younger clients naturally have greater expectations in terms of being able to access information instantly, so the demand for accessing a range of services 24/7 will significantly increase specifically on mobile devices.

Services, meanwhile, should be cutting-edge and deliver a personalised experience for each client, tailored services and communications based on their current holdings, interests, goals, life events, financial activity and overall requirements. We are already seeing this type of technology and functionality being delivered by the challenger banks, fintech and insurtech entrants into the market.

Integrations will play an essential part of the overall service advisers provide, whether that is integrating multiple software tools or services, or in the era of open banking data, which consumers will want to be used efficiently in multiple processes cutting down on form filling, factfinds, know your client, application forms and so on. Moving forward with the introduction of artificial intelligence and machine learning, the ability to constantly monitor and service clients 24/7 on real-time data will become the norm. 

While smart use of technology can give an adviser a competitive advantage for the next generation of clients, choosing the right technology - one that simplifies, streamlines and automates business processes - is paramount.

The very purpose of such technology should be to efficiently provide services to clients with quicker, more cost-efficient processes, workflows, automated monitoring, business checking, real-time management information, and so on, while ensuring that all regulatory requirements are being met.

The application of advanced analytics to improve decision-making processes leads to higher quality of products and services.

According to PwC data, firms that continue to resist digital innovation face becoming less competitive. While some are reluctant to embrace technology, those savvy advisers who do and are using technology as an asset to better serve their clients will undoubtedly thrive. 

Steve Andrews is head of managed services at Focus Solutions

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