BERWYN, PA — Envestnet (NYSE: ENV) has released its 2024 Advisor Perspectives Survey, offering a comprehensive look at the current state of financial advisory practices and future industry trends. The survey, which collected responses from 290 financial advisors, aims to shed light on how advisors plan to grow, scale, and protect their businesses.
One of the most significant findings is the potential in providing holistic advice. “Despite the industry service model expansion we’ve seen to date, advisors surveyed identify holistic advice as the single largest untapped opportunity in wealth management today,” said Rich Aneser, Chief Strategy Officer for Envestnet. He emphasized that Envestnet’s strategy aligns with this opportunity by offering a comprehensive wealth management platform that integrates technology, data, and a wide array of wealth solutions.
The survey outlines five key insights:
- Holistic Advice: Advisors see the integration of services like tax, estate, and 401(k) planning as a significant growth area. Clients also prefer this holistic approach, with nearly half expressing a desire to work with professionals who can address various financial needs.
- Fee-Based Models: Advisors affiliated with brokerage firms expect to increase their fee-based asset mix by 11 percentage points over the next five years, indicating a shift towards more transparent compensation models.
- Integrated Technology Stacks: A majority of advisors favor all-in-one technology solutions over do-it-yourself approaches using separate tools. This preference underscores the importance of integrated systems for improving operational efficiency and client experiences.
- Organic Growth Challenges: Time constraints and prospecting efforts are key obstacles to organic growth. While 71% of advisors consider organic growth very important, median growth in assets excluding market appreciation remains modest at 2-3%. This suggests a need for new strategies, including outsourcing business functions, digital lead prospecting, brand marketing, and automation.
- Next-Gen Investors: Serving younger, digitally native investors is becoming a focal point for advisors. Thirty-six percent plan to add tools and advice for this segment within the next two years. Modern client portals and mobile apps are necessary to engage this demographic.
“The survey results indicate a growing recognition amongst advisors of the importance of attracting and retaining next-gen investors,” said Chris Shutler, Head of Strategic Development & Market Intelligence for Envestnet. “Surprisingly, only a fraction of advisors mentioned the untapped potential of data and AI in their open-ended responses. This reflects both an underappreciated opportunity and the early stage of development for generative AI use cases.”
The complete 2024 Advisor Perspectives Survey covers additional topics such as investment alpha, firm valuation, high-net-worth service opportunities, financial planning utilization, and the increasing emphasis on client portals. These insights provide a roadmap for advisors looking to navigate the evolving landscape of wealth management.
For the latest news on everything happening in Chester County and the surrounding area, be sure to follow MyChesCo on Google News and MSN.