Mentioned In This Article

Coaxing clients to do anything is the hurdle many advisors know they will face in 2011. Thankfully, there are updates to financial planning software that offer some back-to-basics tools designed to help advisors illustrate portfolios more simply, allow investors to assist in their own planning, and even compare their goals against peers. The tools give clients a bit more control, and, as a result, a bit more comfort.

“Based on market events, clients are looking for more information and more transparency,” says Jennifer Valdez, senior vice president for SunGard Wealth Management. “Obviously technology will play a key role in that.”

Clients are also anxious about risk—not surprising after the last few years. And now new tools can help them focus more clearly on financial goals; advisors will be able to show clients—in real time— how near or far they are from reaching those goals.

“We’ll probably see, especially now, clients less interested in investments and more interested in managing cash,” says Sophie Schmitt, senior analyst at research firm Aite Group based in Boston, Mass. “So solutions that do more than just spit out an investment [idea], but also a debt management and emergency cash reserves will be potentially desirable.”

Reaching "the Goal"

SunGard has funneled those concerns into WealthStation’s most recent upgrades, now pushing up to the minute alerts on how clients are reaching targets from asset accumulations to education funding, or any other kind of financial milestone a client wants to create. And advisors can then forward that information immediately to clients.

“Reps can already set goals today,” says Valdez. “But now they’ll be able to monitor that progress.”

Fiserv is also building planning and monitoring tools into its AdvisorVision Financial Planning Solutions. The firm continues to hear from reps that investors want to know specifically — and quickly — if/how recent changes in the market are affecting long-term plans.

But Fiserv has branched further, believing that in order to know clearly if goals are endangered, reps must be able to see all accounts, even those that held by other firms. So now, with Fiserv, advisors can see if a client really is weighted too heavily in a specific stock, even when those holdings are elsewhere. Fiserv says that these details will help FAs calm clients especially during those conversations involving changes to assets — and the potential need to adjust how they're invested.

“Investors are nervous,” says Cheryl Nash, senior vice president of investment services for Fiserv, based in Jersey City, NJ. “Advisors may have to sell a different scenario to ensure investors that they can retire. And to do that, they have to be able to look at all accounts.”

Managing the Black Swan

Seeing accounts with more clarity—that is, more completely—is obviously important. Imagine being able to determine that a crash is just around the corner — and then being able to realign a client’s investments against that scenario? Whew! That’s the Golden Goose. So short of being clairvoyant, reps may want to take a look at the latest upgrades to MoneyGuidePro. While Monte Carlo programs have been the rage for years, MoneyGuidePro is now searching for what its founder calls the Black Swan scenario, or the outlier event (versus “normal” volatility) that could throw the-best-laid plans off track.

“The Black Swan is something that happens more frequently than we may like, something in the market that we don’t predict,” says Bob Curtis, founder, president and CEO of PIETech, designer of MoneyGuidePro. “Something like the Great Recession.”

So Curtis and crew have recently added the ability to plan for a Black Swan — or at least plan so that if a blip hits again they’re prepared for the worst case while continuing to hope for the best outcome. The software does this by running a plan on an ideal goal and an acceptable goal -- and then looking for a solution somewhere in between. Finally, the software tests the acceptable against the Black Swan — or the outlier event — and mimics the Great Recession losses.

“And we see what that event does to your plan, compare it against the acceptable goal, and see if we can still reasonably meet that,” says Curtis. “If your plan can withstand that loss, clients are likely to have a great deal of comfort, even though none of us expects that to happen again.”

Buffering for Social Security

Another factor outside of FAs’ and clients’ control? The fate of Social Security. While chatter to privatize the nation’s pension plan has faded for now, Social Security’s solvency is a constant topic of conversation. And while most experts believe the payments will exist at least for the short term, investors still want some assurances as to how their retirement will look with the monthly check — and without it.

To that extent, MoneyGuidePro now automatically adds Social Security benefits into a financial plan — but also looks at scenarios that include the payment shrinking or even disappearing.

“Three years ago advisors were likely to forget about adding Social Security into a financial plan, assuring clients that, ‘We’ll make so much money you won’t need it,’” says Curtis. “They’re probably not saying that anymore.”

Clean, Simple Lines

All these additions are wonderful tools — but clients still need to be able to follow their reports in the simplest way possible. Enter EISI’s newest upgrades to its Profiles Professional Version 10 offering a slideshow-like view that even builds interactivity into the report.

There are four different presentations, calculators embedded throughout, legends to help quickly navigate, and the ability to save data right into the plan — ideal for working with new clients who want a quicker overview before making the decision to invest money, and time, further.

Then for reps who want to let their clients take the reins a bit, EISI has also launched a new product tentatively called “My CFA” which can be re-branded for individual firms, and sit on a rep’s Web site allowing clients to do some mini-retirement calculations on their own. EISI sees this as a great client prospecting tool, especially for younger investors, by letting them feel they have a bit more information, before calling a rep to take the next step.

“One of the things we’re finding, not necessarily with Boomers but the younger generations, is they like to play around a little bit and do some pre-education,” says Linda Strachan, senior vice president of product marketing with EISI. “So they go into a meeting knowing a little bit of what is going to happen, and a bit more understanding of the experience.”

The Role of Social Networking Media

Attracting young investors is also key for reps who want to keep a business alive. Boomers may have been the bread and butter in the past — but as investors approach retirement, advisors are also looking to diversify their client base.

One lure is using the kind of technology that younger investors understand, such as social networking. While advisors have avoided Facebook and Twitter because of compliance issues, mimicking social networking apps can be alluring and in the right guise useful, believes ThomsonReuters.

With its newest portal, currently called Prism and launching this year, the firm has designed a community environment that it believes will attract new customers — especially younger investors, who are alternatively tech-savvy but very cautious when it comes to the market.

Investors will be able to compare their retirement goals, plans and results with other investors anonymously through a forum where they can share ideas, and concerns. The hope is that investors will use the social network to share information, and then come back to their FA for fine-tuning on their own portfolios.

“You have a very interesting phenomenon with a new set of investors coming out college and going into work force who are very risk adverse because of the economic upheaval, and have maybe seen traumatic events in their home with layoffs among their parents,” says John Fennelly, global managing director wealth management at ThomsonReuters in New York. “We’ve heard many economists and strategy folk talk about this community as the most risk adverse since The Great Depression. So how do you connect to these folk? Well, they’re certainly more comfortable with social networking than an older generation may be.”

Yet whether it’s social networking, cleaner presentations, better goal planning tools or projecting for the what-ifs, FAs will have more in their software arsenal in 2011 to help calm all kinds of investors about what lies ahead — and to keep them on the most advantageous track for them.

“There’s still a strong demand for trusted advice,” says ThomsonReuters’ Fennelly. “Certainly investors of all stripes are looking at the events of the last couple of years, trying to understand the direction the market is moving, and have some meaningful dialogue.”

Vendors' Info

Fiserv AdvisorVision Financial Planning Solutions

Pricing: Configurable solutions allow for the purchase of either separate add-on features or a subscription to the full technology suite. Priced from $199 to $1,500 for an annual license fee.


Newest upgrades, adds: Recent 7.5 Release provides enhancements that include monitoring financial plans and automatically alerting advisors on important changes to their clients’ financial situation through a dashboard on the web or through a mobile device such as an iPad or a smartphone. Also new are Client and Advisor Dashboards.

Contact information: Tony Ortale or Gary Bondaug 510-824-3777 ext. 1

Profiles Forecaster v5.0 (EISI)

Pricing: Individual licenses are $595. Discounts are available based on volume, long-term commitment, and affiliation with a particular company. A discount also applies to a license for your assistant.

Newest upgrade, adds: An upgrade included Redtail CRM integration and new budgeting capability in November, 2010.

Contact: EISI Representative at sales@eisi.com

Profiles Professional v10.0 (EISI)

Pricing: Individual licenses are $1045. Presentation Module LTO is priced at $95 with the New Retirement Consumer Facing Tool at $395 for individual advisors. Discounts are available based on volume, long-term commitment, and affiliation with a particular company. A discount also applies to a license for your assistant.

Newest upgrades, adds: An upgrade included Presentation Module, Redtail CRM integration, Case Review and Basic Workflow in November 2010.

Contact: EISI Representative at sales@eisi.com.

WealthStation (Sungard)

Pricing: Ranges from $35 to $240 per month per user depending on capabilities selected.

Newest upgrades, adds: These include integration with SunGard's MarketMap for global, real-time and historical data, news and analytics; SunGard's Protegent Customer Onboard new account opening solution, as well as performance data from third-party solutions; and Dow Jones Adviser news content. The firm also launched a Web Services version of client-facing financial planning tools and capabilities for firms that want to deploy their own user interface. Expanded client relationship management tools include wealth reporting, alerting and account monitoring. Enhancements to SunGard's Cost Basis Reporting Engine to meet regulatory requirements.

Contact: Jennifer Valdez, SVP of SunGard's Wealth Management business, 916-231-6020, jennifer.valdez@sungard.com

MoneyGuidePro

Pricing: Individual list price is at $1,295 per year. Affiliation discounts are $995 per year, which includes all upgrades and phone/email support. Additional quantity discounts available.

Recent upgrades, adds: The firm added a SMART Portal with Snapshot, along with an enhanced SuperSolve and Play Zone in 2010. A program called Cash Reserve Bucket for retirement is coming in 2011.

Contact: For individual sales, 800-841-5312, sales@moneyguidepro.com. For enterprise sales, Chad Blythe, VP of Sales, 804-744-5900, ext. 141, chad@moneyguidepro.com.

Thomson ONE Wealth Management

Pricing: Firm would not make this information available.

Recent upgrades, adds: Newest upgrades include Thomson ONE Wealth Management 5.0, which is easier to install, updates automatically and has central storage to enhance mobility, and also Thomson Reuters PropGen, a customizable, scalable and easy to use proposal generation tool that allows for the creation of multi-asset proposals in minutes.

Contact: Firm would not make this information available.