Why technology must enable sustainable financial advice

jacqui henderson advice intelligence financial planning association Producing Statements of Advice CoreData

3 October 2019
| By Industry |
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As we approach the year 2020, thinking about the notion of a sustainable financial advice model, we can’t help but first consider the historic challenges that have driven the financial advice sector into its current state of flux.

The good thing about being in a flux state, is the opportunity it provides us to adapt and elevate. 

As a technology provider, with a solid mission to help more people access quality digital advice, the type of technology that will support this industry going forward needs to be designed in alignment with the way consumers interact, whilst maintaining compliance standards. 

It is also our responsibility to deliver tools that help advisers deliver an advice experience that inspires consumers to want to pursue the process of advice, in a language consumers understand. If we do not change the current model, we risk disadvantaging the Australians who need financial advice the most.

We all know that pressure has been mounting across several fronts – increased regulation, higher education standards and challenges to traditional revenue streams, all of which are creating a fair amount of existential navigating. 

The fact still remains that 50% of Australians currently have unmet financial advice needs, primarily in strategic advice, cashflow management, insurance and superannuation – according to Investment Trends research. The way forward to create a sustainable financial planning industry to meet this demand, is to harness emerging technologies.

Existing technologies simply don’t cut it. The traditional advice model has been supported by ‘old world’ technology that’s continuing to deliver ineffective and inefficient advice to consumers.


We have to accelerate digital transformation through a human-centric lens and address the current friction and inefficiencies that exist in the current financial advice process.

When we asked consumers about their own financial planning experience, most respondents stated they wanted to be part of the process and educated along the way. Some 26% agreed to the advice they were provided with, yet didn’t entirely understand it; 29% thought decisions were left for their adviser; and 45% said they wanted to be involved, with more knowledge. This demonstrates the massive gap that exists between advice and consumers.

For the industry to evolve, rebuild trust, and deliver an inspiring advice experience more broadly, we must first listen to what consumers want. 

Consumers are seeking an experience that delivers advice as an instant and interactive service, available at their fingertips using their smartphone rather than via a paper document that is static and often confusing for them.   

Consumers need to be empowered to play an active role in determining their financial futures, and as in other areas of their life, they are expecting this process to be in the palm of their hands.


In this changing regulatory environment, where it costs upwards of $50,000 for an advice practice just to open its doors, how can an adviser stay in business, with such challenges to current and future profitability?

Old world technology was not designed for today’s consumer, nor regulatory environment. The traditional advice process is manual and lacks consumer facing engagement.

New developments in technology offer new opportunities for licensees and advisers. Technology will be the enabler of smarter, safer and more efficient advice for Australian consumers. Licensees have a significant opportunity to capitalise on this new tech-driven advice model.

We all want to create a sustainable model that reduces the cost of advice to service the greatest number of Australians. 


Regulators globally are working to ensure that consumers receive quality financial advice tailored to their particular needs and situation. Compliance is part of the value chain, and when it’s inefficient, it adversely affects the value delivered. Advisers, licensees, and consumers are all paying for these inefficiencies. According to CoreData, on average, administration and compliance make up 29.9% of an adviser’s time – nearly 12 hours a week.

Paraplanning is also a significant cost within the advice process. Producing Statements of Advice (SoA), template coding, and data input takes a lot of time and is very inefficient. The result of all this work is a printed document, pages long, static, and full of complex terminology that clients rarely read or understand properly. Essentially, a lot of work goes into creating something that has limited practical use for the customer.

Latest research indicates that 43% of Australians who receive financial advice are confused by the content and language of an SoA, while 24% don’t even read the document.

According to the Financial Planning Association’s research it takes on average 26 hours, at a cost of between $3,715 – $6,063 to complete an SoA. 

If we equip the client-facing advice experience to handle data collection, modelling, strategies, and complexities of document generation automatically, we can remove significant friction from the advice ecosystem. 

Digital and instant SoAs will mean that a client’s tailored and personalised financial plan can be generated at the click of a button and delivered directly to the client’s app. 

We must see the simplification of a client-facing, tech-based and goals-based advice process that empowers consumers to choose the way they receive advice, tailored toward what is most important to them – their life goals.  

Jacqui Henderson is chief executive of Advice Intelligence.

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