2017 has already been the year of change, as a result of which, multiple industries have already gone through numerous modulations and shift in business perspectives and methods. The inclusion of the robot-advisors into the world of finances and wealth management, the uncertainty of the DOL fiduciary standards, newer technologies taking a stance in the regular operations, all have cumulatively had a profound impact on the entire financial scenario.
So while the investors are looking forward to adapting to these changes, it seems to be not tough at all except the conventional investors to whom the security and safety matters. So how and which changes will make the difference in the industry. Patrick Dwyer Merrill Lynch has been studying hard and has come up with specific trends which he believes might help the industry progress.
What does Patrick Dwyer Merrill Lynch believe to see in 2018?
The month of April, according to him will bring in a sea change for the financial advisors, and the way they followed to do their business will also have some deep-rooted effect. Why? Because there is no singular solution for the firms and the companies as well to implement the multiple fiduciary policies and hence the entire market is expected to transform into a financial planning technology. What the firms and the companies need to do is understand these policies, and also get hold of the fact that they need to adjust their business plans and processed accordingly for 2018 and henceforth.
Another important criterion that cannot be missed under any circumstances is the wealth transfer that will be taking place in the year of 2018. Going by the average life expectancy of the people who were born in between the 1940s and 1950s has been 60 to 66 years of age. So making some rough calculations will help one understand, that 2018 stands at the juncture where largest generational wealth transfer is going to take place. So all the wealth management firms and companies need to make sure that they have the right set of strategies on board to go through this transitional phase and also deliver maximum service to all the clients, maintaining the rate of retention same.
Keeping the same group of investors into consideration, most of them believe in finding advice regarding their wealth management schemes from individual advisors of flesh and blood. However, the market has progressed towards something that allows more and more of automated investment platforms or robot-advisors who have indeed helped the companies achieve their expected profitability.
But, what Patrick Dwyer Merrill Lynch believes is to have a hybrid system that will have the presence of personnel staffing and robot-advisors and the combination is ought to give the maximum result. There are some responsibilities for which a man cannot be substituted, and also some, where machines cannot be. So, it is the combination of both which is expected to reap maximum benefits.
Just like any industry, the wealth management is going through a change, and the sooner this change is being accepted, the better it gets for the investors and also the companies.