For some investors, having a face-to-face discussion with a financial advisor will always be the preferred way of obtaining financial advice. But for others, location-related challenges and scheduling difficulties may make this more traditional model an undesirable option. In these cases, a remote or online-focused approach may be the answer.
Some financial planners, in particular, have shifted their models to accommodate those clients who prefer to meet virtually. That approach has not only resulted in benefits to client satisfaction, but has delivered cost and other business-related advantages to those advisors who offer it.
Noel D’Souza, a financial planner at Money Coaches Canada, initially offered clients a choice of meeting in-person at his office in northeast Toronto or online when he started his practice in 2012. After four years, he says he found that more than 80 per cent of clients were choosing the virtual option.
“Quite often, they would be interested in meeting once, and then when they found out that I offered online meetings, they were quite comfortable trying that out,” he says.
Mr. D’Souza subsequently adopted an online model for his practice, meeting clients not only from Toronto remotely, but many from across Canada who may not have a fee-only financial planner available locally.
Although location may lead some clients to choose advisors who offer the virtual approach, those who favour this model generally do so out of a desire for flexibility and convenience, say financial planners who offer their services remotely.
“We can meet clients anytime, anywhere and they can meet us from the comfort of their own homes or potentially at work. So, in terms of accessibility and ease, an online-only model makes it incredibly easy for clients. They’re not forced to go to a physical location,” says Owen Winkelmolen, founder and fee-for-service financial planner at PlanEasy Inc. in London, Ont. (He started his practice more than two years ago by offering both in-person and remote financial planning, but, like Mr. D’Souza, has since made the transition to an online-only model.)
The virtual model also allows clients access to a larger pool of skilled professionals, says Sandi Martin, partner, chief operating officer and financial planner at Spring Financial Planning.
“Our paraplanners – who do a lot of the preparatory work for our clients and enable us, the lead financial planners, to focus in on the issues we’re experts at – are from all over the country.”
But it’s not only clients who win with an online-only offering. In adopting this model, advisors shed the expense of a bricks-and-mortar location, the need to commute and even print material. Furthermore, it’s incredibly efficient from a time-management perspective.
“I can have multiple calls in an evening. If we were meeting face-to-face, it would be a little bit more difficult to do that,” Mr. Winkelmolen says, adding that the increased efficiency is reflected in his fees.
Another key advantage of providing services remotely is the opportunity for advisors to broaden their client base, allowing for further specialization. For example, Mr. Winkelmolen’s firm focuses on pre-retirement planning for those without complex situations.
Furthermore, the savings realized by not paying for a physical location, Ms. Martin says, can be redirected toward further training and cybersecurity.
“It’s ultimately far better for our clients to be seeing people who are highly-skilled and who are continually able to invest in their own education,” she says.
Although additional investment in equipment is required to operate a virtual practice, Mr. D’Souza says the technical barriers to entry are relatively low.
The preferred approach for many virtual meetings is to share screens through video-conferencing software and speak to clients through that software or on the phone rather than via video chat, which some find distracting, he says.
Mr. D’Souza uses conferencing tools such as Zoom and Join.me to share documents and spreadsheets on-screen with clients. Sharing files with clients is often done via Microsoft OneDrive for Business and Sync, which are password-protected and encrypted.
At the same time, robust hardware is crucial, says Mr. D’Souza, who advocates using multiple monitors and computers, installing a battery back-up and second internet connection in case of outages.
Security is also paramount. Mr. Winkelmolen says that identifiable information, such as account numbers and even names, are left out of documents shared virtually while Mr. D’Souza says his computers are encrypted and data are stored on Canadian servers.
Although the online-only model is gaining traction among a certain client base, establishing trust online remains the biggest initial hurdle for many advisors in the absence of an in-person connection.
Ultimately, Mr. Winkelmolen says that it’s important for financial planners who work remotely to have a process that establishes trust first before getting into deeper issues.
One way to do this, he says, may involve conducting an initial assessment with a prospective client so that both parties can establish a rapport early on and determine whether they – and the model itself – are a good fit. It is also advisable for financial planners to be more active online via blogging or posting case studies, he says, so that clients can gain insight into the benefits they can expect from this approach.
Although Mr. Winkelmolen believes there will always be a market for in-person financial advice, a remote option affords certain clients the chance to choose a model that works best for their situations.
“This [approach] gives [clients] another option for those cases in which that’s simply not practical or efficient and offers some advantages as well in terms of convenience and privacy,” Mr. D’Souza says.