This content is from: Practice Management

Email Is Sooo Yesterday for Many Clients

Advisors who quickly adapt to a fast-changing communications landscape have a much better chance of keeping clients happy.

While many financial advisors complain that there aren’t enough hours in the day to get all their work done, they’re hearing a similar refrain from time-pressed clients who also have to navigate their way through hundreds of emails in their inbox. 

In fact, according to data collected by VoiceSage only around 20 percent of emails are opened. In contrast, 90 percent of all text messages are read within three minutes of being sent. Just a half decade ago, few advisors would have been comfortable tapping into this intimate form of communication. After all, texting is usually done between family and friends, not in business relationships.

That taboo is quickly receding and a growing cadre of advisors now see texting as a core form of communication. Ryan Marshall, a financial advisor with New Jersey-based Ela Financial Group, says that “texting has caught on with both older and younger clients.”

Short simple messages such as “do you have time to talk?” or “it’s time for your review” can elicit an instant response from clients. At Ela Financial, roughly two-thirds of the firm’s 150 clients now communicate with the firm via text.

This flies in the face of what we’ve understood about the strict rules around client communication and documentation. As far as regulators are concerned, if it can’t be documented (and archived), then it shouldn’t be communicated.

That’s where firms like Hearsay come in. The company offers various communications modules that are purpose-built for financial advisors. Hearsay Cloud, for example, tracks communications across all of an advisor’s social media, text messaging and local website activity. Texts sent out to clients, for example, can be routed through the Hearsay server.

Of course, more instant forms of access like texting can lead to clients getting in touch at all hours. That’s why “it’s important to set boundaries,” says Doug Boneparth, President of New York City-based Bone Fide Wealth. Boneparth, who relies heavily on Twitter and LinkedIn, “likes to have those channels open." He insists "it’s really important to set expectations on how and when you’ll respond to clients.”

Conventional wisdom holds that younger clients are much more open to technology and newer ways of communicating. Boneparth says that “in this case, the stereotype is fairly true,” adding that “older clients still prefer email, face-to-face meetings and phone calls.” His younger clients are much more open to virtual planning and communications via Skype or other platforms. 

For compliance and archiving purposes, Boneparth prefers Erado, one of the leading providers of supervision, reporting, security and archiving software. That software is a popular choice for national broker/dealers such as LPL Financial and Jackson.   

Technology is re-shaping almost every aspect of client communication, including more efficient ways to help clients tackle their tasks in the implementation phase of planning.

Single Point Partners’ Seth Corkin, who goes by the title Personal CFO rather than financial planner, says that many clients have long workdays and are unable to focus on communicating until after the kids have been put to bed. 

In response, Corkin’s firm has been developing Knudge, which helps clients stay on top of the communication flow with a shared to-do list.

“Automating the communications ensures that things don’t fall through the cracks with clients,” he says. Knudge is in beta testing now, and may be released to the advisor community later this year.

Whatever new forms of communications advisors adopt, it's important that they remain nimble. A few years from now, email and texts could be history while AI might be able to respond to a client’s message at any hour with the right set of information. 

That may be a scary proposition for some, but any technology that makes advisors more efficient and leaves clients with a better sense of being cared for, is an inevitable evolution for communications.

David Sterman, CFP, is President of New Paltz, NY-based Huguenot Financial Planning


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