The last decade has been an amazing period of change for the independent advice industry, but I think what we’ve seen so far is only the tip of the iceberg. Looking ahead, there are forces outside of the industry that will bring changes for clients and opportunities for independent advisors.
In the decade ahead, I believe clients will have to consider an entirely new array of questions as they work toward building financial security for themselves and their families. Many of these questions will be complex, demand exploration of uncharted territory and require highly personalized solutions.
Quote“There are many forces of change — including AI, digital privacy, health care and geopolitics — and their impact on clients is ultimately deeply personal,” writes Bernie Clark.
Major forces of change don’t typically have linear consequences. By upending the status quo, they can have both positive and negative implications for clients. For example, how will artificial intelligence and automation affect clients in the next decade? Forrester predicts 25 million people will lose their jobs in the next 10 years due to robotics. That is roughly three times the number of jobs lost in the aftermath of the financial crisis.
But, we also know that the growing use of AI will create exciting new opportunities and add immense value. Experts say we are 10 to 15 years away from a robot-driven economy. That means today’s elementary school children will be living in a largely robotic world by the time they are in college.
There are many forces of change — including AI, digital privacy, health care and geopolitics — and their impact on clients is ultimately deeply personal. When humans are faced with change, their reactions can vary. For some, it’s avoidance, or the “stick your head in the sand” approach. Others have anticipatory anxiety — they worry about and fear the unknown. Finally, there are those who live life wearing a catcher’s mitt, ready to grab impending change no matter what. They’re driven by the excitement of what could be.
And that’s the opportunity. Understanding where macro changes intersect with your clients’ lives and how they are likely to respond to the unknown and the unpredictable will become an increasingly important part of your role as advisors. You can play a valuable part in empowering your clients to embrace change and adapt strategically to build a prosperous future.
Begin by understanding which changes matter most to your clients so that you can be ready to provide counsel or connect them to the right resources. As you head into 2018, think about how to expand your circles of influence to include new specialties, double down on new areas of expertise and bring professionals from outside the fields of finance and wealth management to your teams.
The independent model has flourished because of trusted relationships built on the basis of the fiduciary standard. As a result, independent advisors are now uniquely positioned to drive a new wave of growth by delivering a broader value proposition. I am confident the independent model will continue to shape the future of advice, and I am excited about what that means for investors.
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