The financial services industry is constantly evolving, especially as a result of increasingly innovative technology. In turn, advisors need to make changes that will enable them to better meet investor expectations and become more efficient and effective. The Essential Advisor: Building Value in the Investor-Advisor Relationship, co-authored by Chief Executive Officer of Envestnet, Bill Crager, explains how advisors can capitalize on the opportunities presented by this shift, leveraging the best technology to deliver the most value to their clients.
To help advisors achieve this vision, we created the Essential Advisor™ Certification program, which enables financial advisors to better articulate return on the advice they’re delivering, build and communicate a distinctive value proposition, utilize technology and data to clarify financial challenges, and implement a service model that can save time and resources. As a culmination of the annual program, Envestnet presents the Essential Advisor Awards at the Advisor Summit to those who we believe embody the values of an essential advisor.
In a series of blog posts, we’ll be highlighting the 2019 Essential Advisor award winners. Each interview is intended to provide insight into the award recipient’s career, their advice for their peers, and their thoughts on industry best practices and what the future may hold.
The interview below features Traci Garnett-Froscheiser, financial advisor and owner of Garnett Investment Strategies, a Registered Investment Advisor firm in Beatrice, Nebraska that serves clients nationwide.
How would you describe your firm’s value proposition?
We focus on providing holistic advice for our clients over their different stages of life and customizing portfolios to fit their goals, timelines, and risk profiles. We strive to give them a white-glove, first-class experience.
What is your definition of “essential advisor?”
I believe that an essential advisor is the person that people and their families turn to when they want professional and unbiased advice – especially related to the biggest moments in their lives.
What does winning the Essential Advisor award mean to you?
It was extremely flattering to even be nominated for this award! I was a little in shock at first, but then I came to realize that our office, staff, and advisors together are running an outstanding practice and our clients are happy with their service and experience. To be recognized for this feels really good.
What skills do you believe best position advisors for success?
I believe that advisors really have to care for their clients – not just their business’ bottom line. I am passionate about helping my clients achieve financial wellness and believe that I can educate them along the way. It feels good when you are a part of someone’s life in the way that an advisor can be, often through multiple generations of a family.
How do you and your firm leverage technology to better serve your clients?
We have utilized several different technology platforms. Envestnet gives us the access to the money managers that help us stand out from the traditional brokerage firms and wire houses. They also allow us to trade and rebalance efficiently.
We recently started to use Envestnet | MoneyGuide to present clients with scenarios on Social Security, saving for retirement, retirement income distribution, and risk measurement. We also use Fi360 for the retirement plans we advise on to monitor, score, and report on the investments inside a plan.
What role does Envestnet play in helping you to deliver better outcomes for your clients?
Envestnet has been a great partner for us because of the technology advancements they continually deliver. It allows us to be efficient within our client accounts. We can trade stocks and funds with one click, we can update models or risk quickly, and we can show how those changes affect the account diversification with ease.
The reporting for clients is also key in making sure they understand their account diversification, the risk profile of their investments, demonstrating different scenarios, and accurately presenting their historical returns.
What are the biggest challenges facing your clients as they seek to achieve financial wellness?
Balance. Currently we live in a world of “keeping up with the Joneses;” it is too easy to get into competition and lose track of a budget. Access to online retailers can also break a budget because of the potential to purchase something with just a click. We have always had a “live below your means today, so that you can live within your means in retirement” mentality. If you can be consistent, diligent, and prudent with your money, you will reap the rewards in retirement. And, the earlier you start, the longer you have to enjoy the effects of compound interest.
What changes do you see taking place within the industry in the next three-to-five years?
The wealth transfer from the baby boomers to Gen X, Gen Z, and millennials is going to force some advisors out of their comfort zone. We must be equipped with the right tools to attract and retain that business, all while keeping costs low enough to exceed client expectations but also keep our business running profitably.
We will probably also see fees on trades, and potentially even commissions, come down more than they already have. I also expect to see some added legislations and regulations for our industry, forcing some advisors to change how they run their business. We saw this change coming a few years back and made the move to a Registered Investment Advisor firm to try to make sure we evolved with the industry. We saw that our clients were wanting this kind of evolution and change without saying it, and they have been delighted with the open architecture of our business model today.
As the industry evolves – and investors along with it – how are you and your firm navigating the changing landscape?
We are utilizing social media for putting general information out to the public. If this starts a conversation around the dinner table and entices those people to take action on a topic they have been curious about, then we have accomplished something, even if we aren’t their advisor. We are also trying to stay up with the times and offer reviews through various communication channels, including over video conference.
If you could offer one piece of advice to your peers, what would it be?
Have the tough conversations with clients. They want the advice; they just don’t always know how to ask for it. They will be grateful for it in the long run. It is our job to make sure our clients’ financial lives are in order.
If you could offer one piece of advice to investors, what would it be?
Ask questions if you don’t understand. Don’t be afraid to tell your advisor what you need and want. Understand that the markets are going to go up and down several times over the course of your investing life and that the market has always recovered after a downturn. Make sure you are honest with your advisor, so that they can best serve you and give you the appropriate advice.
Advisors are invited to apply to join the Essential Advisor Certification program each year at the Advisor Summit. To learn more about the program and access valuable resources, visit our website.
The information, analysis and opinions expressed herein are for informational purposes only and do not necessarily reflect the views of Envestnet. These views reflect the judgment of the author as of the date of writing and are subject to change at any time without notice. Nothing contained in this piece is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type.