LPL Embraces Financial PlanningLPL Embraces Financial Planning
Gone are the days of deciding whether financial planning should be offered, said executives. Today, the decision worth considering is how to charge for it.
“You’re all planners now.” That was the message from outgoing LPL executive Andy Kalbaugh in a short video shown at the virtual LPL Focus advisor conference on Wednesday.
For newer advisors, a focus on planning may not seem like such a leap, particularly as the number of financial planning tools and programs grow. For others, it’s one more change from a company that’s made efforts to not only build an employee advisor channel, but to turn around its tech offerings, as well.
“We used to talk about this topic in terms of to plan or not to plan,” said Kalbaugh, managing director and divisional president of national sales and consulting. “As an industry, we probably made it more difficult than it needed to be.”
Financial planning can help advisors “stand out in the crowd,” he explained. Offering financial planning creates more value and diversifies advisors’ revenue streams.
To truly capture the value of planning, advisors need to think about charging for the service, added Matt Enyedi, managing director of national sales and consulting. With investment management no longer differentiating the way it once did, planning is “what’s really driving the value in the client relationship.”
With the rise of robo advisors over the past decade, a combination of a planning fee and an advisory fee allows the client to better understand the services an advisor is offering, he said.
“It’s becoming a subscription economy,” said Kalbaugh. He used the conversation about fees to suggest advisors should be using AdvicePay, a fee-payment-processing company that’s partnered with LPL.
LPL also has been adding to its list of financial planning software providers. In January, the firm linked Envestnet | MoneyGuide to its ClientWorks platform, joining eMoney. LPL’s own Client Goals financial planning application launched in 2019.
