At the Dynamic Planner conference back in March this year, Dame Harriett Baldwin, MP, passionately highlighted to our audience the challenges we as ordinary consumers face in getting support to make choices with money: “Only the rich, the 8% of the population, can benefit from the healthy financial options. The remaining 92% are being left in the generic aisles.” The great unserved.
However, she also offered some hope, both for consumers and for advice firms who recognise the commercial opportunity presented by the unserved population: “With the developments of technology, in particular more powerful artificial intelligence tools, innovators will find ways to give consumers more customised, less generic financial advice.”
All too often as tech specialists, living and breathing this quandary every day we could fall into the trap of navel gazing, so we commissioned research from AdviserSoftware.com, a division of FTRC, to explore the potential for technology to broaden access to financial planning and open up new markets for advice firms. How do consumers actually engage with financial advice, and how will they want to in the future?
FTRC undertook the research, in conjunction with Opinium, in February and April 2024. The survey of 4,000 members of the general public throws up some interesting learnings.
Alongside meetings with their adviser, 62% would like to track their pensions, investments and progress against their financial goals on a mobile phone app. Demand is strongest in the youngest demographic, with 80% of 18-34 year olds expecting a phone-based digital offering to accompany face-to-face advice, but the preference is shared by close to two thirds of those aged 35-55. Even in the older 55+ cohort, 35% would be keen to check in through an app.
As in other walks of our consumer life, the younger generation are increasingly setting the agenda for how people engage with financial information and advice. Their worlds are mobile and app-led and they want to consume their financial planning in the way they access other services. The writing is on the wall.
Clients by age group who wanted pension/investment/goal tracking on an app
By income group, the results are similarly persuasive. Among those earning £60,000 or above, 81% would like to track their pensions and investments via a mobile app. For those with incomes over £80,000, this increases to 88%. This makes intuitive sense: for busy high earners, the seamless instant access to their financial plans that apps can offer is invaluable.
In addition to the consumer survey, FTRC carried out a comprehensive series of interviews with advice firms in 2023 and 2024. The findings were clear. Advisers want to give clients the best service they can, supported by technology that delivers operational excellence. They want the technology in place to ensure they can anticipate the needs of the next generation of clients and remain relevant and competitive.
Over 90% of firms thought having the means to remain in contact with their clients throughout the advice cycle was a real positive. Allowing the client to remain connected to their portfolio, policies, products, goals and other information through an app would strongly benefit the ongoing relationship.
Since our conference, it’s become apparent that expanding access to advice is not the only challenge. In a Consumer Duty world, firms are finding it more difficult to serve even their existing clients profitably, and we have seen the subsequent drop in the size of the advised population as a result. By making use of this channel, firms can pre-empt client queries, automate processes and speed up communication, reducing the cost to serve.
We believe advice businesses planning for their future can no longer ignore the opportunities that apps can bring, that is why we launched Tram, your white labelled app. To hold the financial plan in the palm of your hand will increasingly be an expectation across age groups. Firms that embrace the possibilities can unlock efficiencies, serve more clients, and bring high quality, engaging financial advice to the next generation. I’m personally excited to work with Dynamic Planner firms to grow their engagement and delight their clients.
Find out how you can engage your clients with Dynamic Planner’s mobile app, Tram>
