Technology is transforming wealth management, but how much should clients and advisors rely on it?

While technology can make grand entrances in the form of new mobile devices or driverless cars, more often it quietly changes our lives before we’ve really noticed. And though there are areas in which technology has made everyday tasks and transactions simpler, there are some areas of our lives that we still prefer to keep offline.

For some, wealth management remained quite traditional, relying on paper records and face-to-face conversations. But the technological tide is changing as advisors and clients grow more comfortable with the efficiency and security of new digital tools.

The wealth advisors who have gotten the most out of these tools have focused on using it to enhance what they already offer: personal, informed advice that helps us make delicate, emotional decisions about our money and our legacy.

Right now, new software and tools are helping to automate paperwork, aggregate and organize information, and provide 24-hour account access to clients who want such information at their fingertips. “New technology allows wealth advisors to have more opportunities to meet with clients face to face, and we have more information to bring to those meetings. The tech provides efficiencies in the access and organization of the data we look at,” says Greg Firek, a Fiduciary Manager with Regions Private Wealth Management. Although technology has changed the way many people invest, Firek explains that there are ways to succeed in the rising digital age.

Being Nimble and Connected

A major advantage of financial technology comes down to speed — making transactions, trading and communication faster and easier than ever. Still, managing your family’s financial security remains a long game. Retirement, family trusts and charitable grants are often decades in the making. But as technology changes the markets and client expectations, wealth managers need to keep pace. “Clients love to be nimble,” says Hollins Rush, Wealth Advisor with Regions Private Wealth Management. “So many banks are creating a more fluid financial advisory process.”

Regions has introduced that fluidity in the form of two major technological advances.

• The first is the Regions Wealth Platform (RWP), an integrated digital solution for all Private Wealth Management clients that offers a streamlined view of your portfolio, allowing our wealth managers to better serve client needs.
• The second major investment in technology is a wealth-planning tool called rTrac®, which allows clients and wealth advisors to aggregate all financial information into one central system to determine a plan to help meet client goals.

Both the Regions Wealth Platform and rTrac are central to Wealth Management serving clients’ needs in a more efficient and holistic way.

“With rTrac, we can store and manage a wide range of information, such as tax returns, wills, healthcare directives, powers of attorney, life insurance documents and trust documents,” says Rush. Aggregating these disparate bodies of information helps clients have a single source for their information and helps wealth managers understand the complete picture of each client’s assets and obligations. It also helps managers consider all the variables and how hypothetical situations might affect a client’s portfolio and plans.

“It was imperative for us to provide clients with a centralized system, like rTrac, that helps them navigate the world we’re part of now,” says Rush. “During the past decade, wealth management has evolved so much. You’ve seen tremendous growth in the capabilities and monitoring structure of platforms that can be a great benefit to clients and wealth managers.”

The biggest transformation is how information in a centralized digital repository allows clients and wealth advisors to access vital information via secured shared drives even when they’re in different locations.

“I’m upfront with clients, and I tell them rTrac is only as good as the information we put into it, which includes the information the client is willing to share,” says Rush. To get a complete picture, he encourages clients to enter into rTrac not only information on accounts managed by Regions, but also external accounts, so clients can see a complete picture of their assets, liabilities and cash flows in one place. Even paper statements — which still can be processed manually — can be included.

The system can also create safeguards and remind clients when it’s time to have important discussions or to make decisions. Wealth advisors and clients can agree to set alerts that notify advisors of large selloffs or balance increases. “Technology in the past met the needs of the financial institution. What’s different now is that it’s geared to the people those institutions are serving,” Rush says.

For clients, one of the most appealing benefits of the Regions Wealth Platform is the ability to access their information and account status from their mobile devices.

Highly Functional Tools to Use with Care

In developing these tools, Regions kept a firm focus on managing the risks of digital technology. Both the Regions Wealth Platform and rTrac employ multi-tier authentication and encryption for advisor accounts to manage the ubiquitous risks in our connected world. “That connectivity allows us to share risk mitigation responsibilities among different parts of our teams,” says Firek.

But the risks of digital technology don’t come just from a cybersecurity standpoint; they come from a human one, as well. As organizations lean in to technology more and more, there is the chance that wealth managers become overly reliant on the software.

“The tech presents a tremendous amount of value, but wealth advisors must make it part of the solution, not the entire solution,” says Rush. “At Regions we work hard to make sure that technology and data are inputs into our recommendations, but we also rely on sound judgment and analytical thinking to make recommendations that meet client needs. We are always sure to remain diligent about digging into the details of our clients’ accounts.”

Technology Can’t Replace Human Judgment

Digital platforms have given advisory teams the means to work in concert with clients to better understand, analyze and manage their assets. These systems offer the promise of being more efficient, even while handling a tremendous amount of data. But their true value will be seen over time, as they help wealth managers track and focus on clients’ long-term goals and strategies.

“If the market had a 5% pullback today, our new rTrac platform lets clients check their financial plan, at any time, and see whether they’re still on track to meet their goals,” says Rush. “This allows wealth managers and clients to easily access and make changes to a financial plan.”

Technology can help inform and shape a dialogue, but human judgment and experience are what continue to bring wealth management clients to advisors. “It’s very simple,” says Rush. “If you remove the advisor, you lose someone who looks out for your best interest, who takes it beyond a mathematical equation and just quantifying goals. You remove a functional, emotional mechanism that helps you get where you want to be.”

Whether you’re investing for retirement, college or another goal, we can provide the in-depth knowledge necessary to assist. Learn more about Regions Wealth Management.