When an advisor decides to go indie, the first thing they must determine is, “what technology tools do I need to start my business?” Your decision should be based on what you want your client’s and your experience to be. Whatever technology you decide on must reduce the time you spend on managing wealth. Technology must increase your focus on the money matters your clients really care about.

It is easy for an advisor’s practice to burn up valuable time with ‘technical issues’ and not use it for nurturing client relationships and pursuing new business opportunities. Your relationship with your client is what matters and how you manage their wealth secondarily. That is not to say that money management does not matter but it should not be all-consuming.

While it may seem easier to opt for the tech stack that comes from a custodian, often, their offering is missing key features such as the ability to work with multiple custodians. Regardless of whether it is ‘free,’ you must find other solutions to make your technology hub complete. With the recent custodian mergers and the process of deciding what technology to remove, many advisors are concerned if their tech stack will stay or if they will have to move onto another.

AdvisorPeakis a long-time advocate of “build your own” tech stack using platform with integrations that fit the specific needs of your practice. This helps to greatly reduce the risks associated when a custodian decides to deprecate software that has become embedded in your practice. This build is easy to accomplish when you make portfolio management the focus of your tech stack adding only components you need e.g. portfolio management, trading and rebalancing, performance reporting and billing, financial planning, CRM, and so on. We also suggest adding critical systems first, and then build out your stack one component at a time.

Kitces.com’s The Latest In Financial #AdvisorTech (August 2020) edition weighs in on technology at BD and independent firms, citing a recent JD Power Study:

“When it comes to integration, currently just 21% of advisors surveyed in both the employee and independent channels say their tech platform is “completely integrated.” These two issues are correlated; automated workflows require seamless flow of accurate data, which is impossible without deep integration across the tech stack. Firms without automated workflows and integrated user experiences will score lower on advisor satisfaction.” – Michael Kitces and Craig Iskowitz.

While taking the opportunity to move to a customizable solution before you must, we recommend avoiding ‘shiny object syndrome’ by deciding what your firm needs first before buying. The last thing you want to do is pay for technology you do not need. However, realize that not having automated workflows through integrations across your tech stack can lower your clients’ satisfaction. Your technology toolbox is what enables you more time with your clients- so choose your tools wisely.

We invite you to experience our trading and rebalancing software and platform integration partners to ensure you have right tools as you build out your tech stack.