Caroline Dabu, Head of BMO Financial Group’s Wealth Planning Group
The financial planning process is a time-consuming, often overwhelming experience involving many pages of paper and financial statements. Today, this process is being redefined to meet the needs of consumers who want a simpler, often digital approach to finances.
In particular, for the younger generation of Canadians whose expectations are being shaped by rapidly evolving technology, they’re going to approach financial planning in a very different way than in the past, says Caroline Dabu, head of BMO Financial Group’s Wealth Planning Group.
“Individuals and families are also far less linear today than previous generations were. It used to be that you worked at the same company for maybe 20 to 25 years, you had kids, you bought a house, you retired. Financial planning was fairly straightforward, but for our generation and the generations following us, that’s changed,” she says.
Milestone events don’t happen in the linear way they used to, which means financial plans become outdated more quickly than in the past and need to be evaluated in a more modular way. Circumstances can often change, and consumers value the ability to immediately visualize the impact of events and choices on their goals.
“The other big change is that consumers, particularly that next generation, are thinking differently about their finances and how they want to interact with their financial institution,” adds Ms. Dabu. “It becomes less about sitting down with a financial planner, having multiple meetings and then being given a large paper-based report, and more about having an interactive discussion with their adviser and co-creating a plan – in any way and anywhere they choose.”
That’s partly due to the availability of more advanced technology and the next generation of financial management tools designed to help consumers better understand and assess their personal finances and financial planning needs. BMO’s own research shows the main reason consumers use digital planning tools is to be more knowledgeable about their situation when they have a discussion with their planner.
Financial planning was fairly straightforward, but for our generation and the generations following us, that’s changed.
— Caroline Dabu, Head of BMO Financial Group’s Wealth Planning Group
“For example, when their planner asks a client how much they may spend in health care costs in retirement, they can give a more specific answer as opposed to guessing what that number might be,” says Ms. Dabu. “The great thing about the technology is that consumers have more knowledge at their fingertips when they think about their finances and goals.”
The upside for financial planners is they can have conversations with clients that are more intuitive and collaborative. And technology available to planners makes their interaction with clients far more immediate than in the past. They can use computer models to adjust plans in real time to match clients’ preferences.
BMO is currently taking technology even further with the launch of BMO WealthPath, an intuitive digital goal-based platform to enhance collaboration between the bank’s advisers and their clients.
“It’s an initiative we are really excited about because it marries state-of-the-art technology with the high-touch advice we provide, which is something that technology alone will never replicate,” says Ms. Dabu.
Nevertheless, people should still be reviewing their financial plan with the adviser whenever there is a significant change in their life, such as marriage, the birth of a child, a job change, a major health event or retirement, says Ms. Dabu.
“I don’t subscribe to the notion that you need to have a fixed date once a year to meet with your adviser to review your plan. In some cases, it might be necessary to meet more than once a year. The timing really depends on individual needs,” she adds.
BMO Wealth Management is the brand name for a business group consisting of Bank of Montrealand certain of its affiliates in providing wealth management products and services.
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