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Tom Rampulla, head of Vanguard’s financial intermediaries group in the United States, shares his perspective on the future of advice.

I’m just back from the 2018 Inside ETFs conference, held in Florida, where in between conversations about market returns, factors and Bitcoin, there hung this question about advisors’ livelihoods in a world that grows more digital by the day. It’s a concept bigger than ETFs, and it’s a message we all need to hear: Change, or forever be changed.

Tim Buckley, my new boss and Vanguard’s new CEO, broke it down pretty explicitly in his opening keynote address. Your job of looking out for your clients’ livelihoods is here to stay, but you need to rethink the tasks you do every day. While this is daunting, he pointed to the path forward and the amazing opportunity of it all.

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A fair amount of gloom-and-doom research has stated that millions of jobs are susceptible to automation and will just disappear. We fundamentally disagree: While there are tasks today that will be automated away, jobs will evolve to increasingly revolve around advanced, uniquely human tasks, such as strategizing and solving problems.

So what are automation’s implications for advice? No doubt about it, computers have just about perfected portfolio construction, driving the core costs of advice down, but the data show that what clients really want is something computers can’t provide. And therein lies the opportunity.


A gateway to success

Technology and automation aren’t threats at all. They are the gateway to future success, perhaps much more success than even the best advisors could build on their own. They free up time so you can focus on the ways in which you can add the most value: behavioural coaching, customized retirement income solutions, long-term care planning, insurance coverage, estate planning and the like.

What’s in it for you? Deep bonds. You’ve invested a lot of time getting to know your clients inside and out so you can provide creative, custom solutions. Where does that get you? You’re no longer simply a price comparison; clients don’t even think about not having you at their sides. And they tell their friends, families and colleagues just how good you are.

We shouldn’t fear or fight technology; we should use it to do things better, faster and cheaper. Enough gloom on where advice is headed; advisors should be energized. Let your value shine through your creativity, coaching and customization—things a computer will never be able to do.

You will thrive.

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Important information

The views expressed in this material are based on the author’s assessment as of the first publication date (April 2018), are subject to change without notice and may not represent the views and/or opinions of Vanguard Investments Canada Inc. The author may not necessarily update or supplement these views and opinions whether as a result of new information, changing circumstances, future events or otherwise.

Certain statements in this presentation may be considered “forward-looking information” which may be material, involve risks, uncertainties or other assumptions and there is no guarantee that actual results will not differ significantly from those expressed in or implied by these statements. Factors include, but are not limited to, general global financial market conditions, interest and foreign exchange rates, economic and political factors, competition, legal or regulatory changes and catastrophic events. Any predictions, projections, estimates or forecasts should be construed as general investment or market information.

While this information has been compiled from sources believed to be reliable, Vanguard Investments Canada Inc. does not guarantee the accuracy, completeness, timeliness or reliability of this information or any results from its use.

This material is for informational purposes only. This material is not intended to be relied upon as research, investment, or tax advice and is not an implied or express recommendation, offer or solicitation to buy or sell any security or to adopt any particular investment or portfolio strategy. Any views and opinions expressed do not take into account the particular investment objectives, needs, restrictions and circumstances of a specific investor and, thus, should not be used as the basis of any specific investment recommendation.

In this material, references to “Vanguard” are provided for convenience only and may refer to, where applicable, only The Vanguard Group, Inc., and/or may include its affiliates, including Vanguard Investments Canada Inc.

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This content was produced by Vanguard. The Globe and Mail was not involved in its creation.

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