Broker Check

From Transaction to Relationship: Changes in the Role of Financial Advisors

| February 17, 2020
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For the past 200 years, the Industrial Revolution wired our minds to think in a certain way, specifically like an assembly line: linear, hierarchical and efficiency-focused…But old factory thinking is now obsolete because the economy and the marketplace have changed on a fundamental level. It has changed from an assembly-line economy to a value hub economy… This shift from an assembly line economy (old factory) to a value hub economy (new factory) is causing unprecedented and irreversible changes.

                                                                                                                                                                                         - Bill Bishop, author, The New Factory Thinker


Reading the words of author Bill Bishop, we recognize a seismic shift in our economy. We’ve gone from making products to generating value; from doing the same-old to participating in a world of constant reinvention.

The same can be said of the financial advisor. Professionals who once focused on “buy and sell” must now enter a new chapter, to bring value to the lives of their clients every day. So – what are the characteristics of this 21st-century advisor? 

  1. Today’s advisor is you-focused.

When I first entered this profession a few decades ago, a large part of our focus was on buying and selling stocks for clients. We were transaction-based: our role was to watch the market, and react. But today, our role is to watch the lives of our clients. Of course, we’re in constant touch with every aspect of the financial world. But our job is to translate those developments into benefits for you. The “what to buy” is still important to the 21st century advisor – but we’re adding the “why” to it. 

  1. They’ve gone from sales to fiduciary.

The 21st -century advisor isn’t doing what he or she does to get a commission. Today, many of us have moved from commission-based sales to taking on the role of a fiduciary. A fiduciary is, technically, someone who acts on your behalf. To take on this role, there has to be a very high level of trust between the client and the advisor. But it’s vital in a world that goes beyond “old factory” standards. 

  1. He or she embraces the power of technology.

Big data has brought huge advantages to the financial advisor. We can determine risk like never before, and use analytics to dive deep before making financial decisions. Of course, our role isn’t to plug numbers into a computer and have it do all the work. Human connection is key – but technology is the ultimate tool. 

  1. The 21st-century conversation isn’t just about retirement.

Sure, you need to plan and save for it. But your financial world is about so much more, and your advisor needs to be a part of it. Should you buy a new car? How can you get three kids through braces and college? Can you afford a place at the beach? Who will take care of your spouse when you’re gone? Everything that has to do with your finances should be discussed with your advisor. Because, in the 21st century, we’re not just number crunchers. We’re problem solvers. 

Here at Claris, we pride ourselves in being 21st-century advisors. We know that being on the cutting edge also means being fully engaged in the lives of our clients. Call us today to talk, and let’s plan for the centuries to come.

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