This week I received yet another question from an advisors asking if it was ok to use a “free Gmail account” to conduct business.
If you're a private wealth advisor, please join Advisors4Advisors (A4A) to get its full benefits.
Register now, and we will donate $20 of our $60 membership fee to Bubbles The Clown’s financial literacy program, and you can post an icon on your website saying you support Bubbles' 501(c)3 charitable organization.
Plus, get other membership benefits, including:
Analysis daily of issues affecting advisors
Aggregation of news from dozens of sites targeting wealth managers
Reviews by advisors of practice management applications
30 independent experts blogging on advisor business issues
24/7 access to webinars with 50 hours of CFP® CE and 100 hours of IMCA CE
The answer is absolutely not! For several reasons like compliance, email encryption and what is becoming abundantly clear PRIVACY!
In fact, Google recently published an update to its privacy policies, which in summary states if you use a free app of theirs, like Gmail, Google+, Picasa etc… ,they have a right to your information. This update to the Google’s privacy policy prompted Congress to conduct hearings to protect consumers.
Google suggests that if you do not like these new policies. you can cancel your Google account and block cookies from your Internet browser. The interesting issue with this advice is that reportedly Google already had distributed code that prevents Microsoft Internet Explorer and Apple Safari browsers from blocking information being sent to Google.
I have not met an advisor who did not care about their clients. So I am assuming any advisor using these services just does not know the risks.
Some of what you should be doing to protect a clients private data:
1.Use a paid and compliant email system.
2.Use email encryption when sending private data.
3.Use a compliant client vault to share private information with clients.
4.When using a consumer service, especially free services, read and understand their privacy policies.
If have read this blog and continue to use a free email service anyway, then either you do not care about your clients or are asking for problems.
Financial Planning Software Usage By Independent Financial Advisors; Results Of A Survey Of 2,019 Independent Advisors Shows MoneyGuide Pro Is No. 1
Tuesday, February 21, 2012 17:46
Which financial planning software is most popular with independent investment advisors serving high-net-worth individuals? MoneyGuide Pro is the clear leader (29.8%) followed by NaviPlan Extended (7.9%), Money Tree Silver (5.8%), and e-Money (5.7%), according to a poll of members of Advisor4Advisors.
If you're a private wealth advisor, please join Advisors4Advisors (A4A) to get its full benefits.
Register now, and we will donate $20 of our $60 membership fee to Bubbles The Clown’s financial literacy program, and you can post an icon on your website saying you support Bubbles' 501(c)3 charitable organization.
Plus, get other membership benefits, including:
Analysis daily of issues affecting advisors
Aggregation of news from dozens of sites targeting wealth managers
Reviews by advisors of practice management applications
30 independent experts blogging on advisor business issues
24/7 access to webinars with 50 hours of CFP® CE and 100 hours of IMCA CE
Seventy percent of A4A members are investment advisors with no broker-dealer (BD) affiliation—fee-only financial advisors—while 30% of those surveyed are licensed to sell securities and affiliated with a BD.
MoneyGuide Pro’s success with this hard-to-please segment of the professional financial advice business is laudable.
MoneyGuide Pro, in a survey of 1,100 advisors in 2002, was used by 5% of those polled, was one of seven planning apps we asked advisors about, and was one of only two Web-based planning apps available at that time. A decade later, in a poll of 2,019 independent advisors, MoneyGuide Pro has 29.8% market share, despite facing a much larger field of 13 competitors and that eight of the planning apps are now Web-based.
Keep in mind, financial advisors come in many varieties. While this survey accurately measures software preferences of RIAs targeting high-net-worth individuals—A4A’s target members—it does not measure the preferences of advisors affiliated with larger enterprises. Brokers, consultants, and insurance agents are not well represented.
Financial advisors are segmented into discrete types, such as financial planners, investment advisors, and investment consultants. The fact that the No. 1 software in our survey is MoneyGuide Pro, while NaviPlan Extended and NaviPlan Standard are much less popular indicates this bias. NaviPlan Extended and Standard have tens of thousands of users in the brokerage industry whose preferences are not reflected in our survey.
Other observations about data:
-- The number of advisors using financial planning software appears to have grown sharply over the past decade. In a 2002 survey of 1,100 advisors responding to a survey sent by email to 35,000 subscribers of Investment Advisor magazine and 750 clients of Advisor Products, 52% of respondents reported using no planning software, Excel, or “other”— some other app not listed in our questionnaire. In the new survey, we did not explicitly ask about Excel but its users would fall under “other.” The recent data show that just 35% of advisors use no planning software, Excel or “other” planning apps.
-- The number of advisors relying on Excel appears to have declined over the past decade. A decade ago, 16.8% of advisors said they used Excel. The new survey did not specifically ask about Excel, but those using Excel would presumably have checked off “Other,” which represents just 9.4% of those polled.
-- e-Money, a comprehensive planning program known for its cash-flow analysis, is growing in usage, especially among advisors affiliated with BDs. While 8% of RIAs listed eMoney as their software, 15% of dually-registered advisors use e-Money.
-- Morningstar Office’s financial planning module is facing resistance with advisors. While Morningstar Office’s portfolio management app is being used by 9.2% of advisors polled, its integrated planning application is used by just 1.4% of those advisors.
-- While 32% of advisors affiliated with pure RIAs (read: fee-only planners) are users of MoneyGuide Pro, just 20% of registered reps use MoneyGuide Pro.
-- In addition to MoneyTree’s Silver program being is used by 5.8% of independent advisors, the company’s Golden Years and Easy Money programs are used respectively by an additional 5% and 1.3% of advisors in our poll. So Money Tree’s total market share is a respectable 12.1%, making it the No. 2 choice among advisors.
Based on data from 2,129 members of Advisors4Advisors, the most popular portfolio management software among independent financial advisors is Schwab PortfolioCenter, followed by Albridge, and Advent Axys.
If you're a private wealth advisor, please join Advisors4Advisors (A4A) to get its full benefits.
Register now, and we will donate $20 of our $60 membership fee to Bubbles The Clown’s financial literacy program, and you can post an icon on your website saying you support Bubbles' 501(c)3 charitable organization.
Plus, get other membership benefits, including:
Analysis daily of issues affecting advisors
Aggregation of news from dozens of sites targeting wealth managers
Reviews by advisors of practice management applications
30 independent experts blogging on advisor business issues
24/7 access to webinars with 50 hours of CFP® CE and 100 hours of IMCA CE
Just over a quarter of the advisors polled by A4A say they do not use any portfolio accounting and reporting application. While the vast majority investment advisors would not practice without a PMS application, these advisors are content providing only brokerage statements to clients. This illustrates the broad spectrum of practice methods among independent financial advisors.
Morningstar Office is the fastest growing PMS provider, with 9.2% of A4A using it. In addition, the 2.5% of advisors who identified dbCAMS as their PMS app are also actually users of Morningstar’s platform, since Morningstar acquired dbCAMS three years ago.
With 2,129 advisors of A4A’s 4,500 members responding to our questionnaire about which PMS application they use, the data reflects preferences among a broad swath of independent advisors. However, like all of the surveys of advisors by advisor publications, is not a scientific sample of private wealth advisors.
The data reflect the PMS preferences of members of A4A. Seventy percent of A4A members say they work at a “pure” Registered Investment Adviser (RIA) as an investment advisor rep and have no broker-dealer affiliation, while 14% say they are registered reps, and 16% say they are “dually-registered" as an IA rep also licensed to sell securities.
An example of the sampling bias inherent in advisor surveys is that only 14.1% of A4A members use Albridge as their PMS app. Albridge says it is used by more than 100,000 advisors and has far more users than Schwab PortfolioCenter. However, since A4A is dominated by investment advisors not affiliated with broker-deals, the results reflect that. Similarly, SunGard’s PMS app is not popular with RIAs dominating A4A’s membership but is popular with private client services at banks and trust companies.
Interestingly, Advent (9.9%) trails PortfolioCenter (23.3%) in popularity by a wide margin, while both companies claim about the same number of users among RIAs.
To put the PMS survey data in perspective, it’s helpful to compare the results to a survey of 1,100 advisors that I conducted in 2002 when I was a columnist at Investment Advisor. A decade ago, my survey asked about five PMS apps, while the current survey lists 14 apps. Also note that more than half the choices in today’s survey are Web-based, while none of the choices a decade ago were online apps.
While a couple of software companies dominated the PMS category a decade ago, the market is now much more fragmented. This is the trend across all categories of practice management apps categories targeted to the independent financial advice business.
As software development becomes easier, more companies have entered the field. This trend is unlikely to stop anytime soon.
Startups run by those familiar with the private wealth business are proving adept at carving out a niche and providing the technology and service advisors demand to create profitable businesses. The success of firms like AssetBook and Orion Advisor Services, which each serve 200 RIAs and did not exist a decade ago, and the sale of BlackDiamond Reporting to Advent Software for $73 million in May 2011, indicate that technology vendors targeting RIAs will continue to flourish.
Established providers like PortfolioCenter and Advent are likely to continue to face growing competition from startups in the decade ahead and the market share among PMS apps will continue grow more fragmented.
Accusing Google of intentionally “tracking the Web-browsing habits of people who intended for that kind of monitoring to be blocked,” the Wall Street Journal is reporting that the Internet juggernaut has been using special computer code on the Apple iPhone that “tricks Apple's Safari Web-browsing software into letting them monitor many users.”
Apple says it’s working to stop the circumvention of privacy setting by iPhone users, the Journal reports.
If you're a private wealth advisor, please join Advisors4Advisors (A4A) to get its full benefits.
Register now, and we will donate $20 of our $60 membership fee to Bubbles The Clown’s financial literacy program, and you can post an icon on your website saying you support Bubbles' 501(c)3 charitable organization.
Plus, get other membership benefits, including:
Analysis daily of issues affecting advisors
Aggregation of news from dozens of sites targeting wealth managers
Reviews by advisors of practice management applications
30 independent experts blogging on advisor business issues
24/7 access to webinars with 50 hours of CFP® CE and 100 hours of IMCA CE
Google in August 2011 agreed to pay a $500 million fine over AdWords sales that allowed U.S. residents to access ads for online Canadian pharmacies, according to the Department of Justice.
Separately, Google in October 2011 pledged not to "misrepresent" its privacy practices to consumers in a settlement with the U.S. Federal Trade Commission, resolving charges that the company used deceptive tactics and violated its own privacy promises to consumers when it launched its social network, Google Buzz, in 2010. The settlement barred Google from future privacy misrepresentations, requires it to implement a comprehensive privacy program, and calls for regular, independent privacy audits for the next 20 years. Another privacy violation could result in major civil penalties and—if Google is shown to have intentionally circumvented privacy settings of consumers—it's conceivable that criminal charges against the company or its executives could be filed by the government.
Google issued a statement saying the Journal is mischaracterizing a technical snafu and reportedly disabled the errant code after being contacted by a Journal reporter. Considering the technical intricacy of the allegations, this is outstanding journalism.
Among 2,374 members of Advisors4Advisors, the most popular CRM is Microsoft Outlook, which is used by 21.7% of those polled. The second most popular choice: no CRM (17%.1%) followed by Redtail (15.2%) and Junxure (13.9%).
If you're a private wealth advisor, please join Advisors4Advisors (A4A) to get its full benefits.
Register now, and we will donate $20 of our $60 membership fee to Bubbles The Clown’s financial literacy program, and you can post an icon on your website saying you support Bubbles' 501(c)3 charitable organization.
Plus, get other membership benefits, including:
Analysis daily of issues affecting advisors
Aggregation of news from dozens of sites targeting wealth managers
Reviews by advisors of practice management applications
30 independent experts blogging on advisor business issues
24/7 access to webinars with 50 hours of CFP® CE and 100 hours of IMCA CE
A4A’s sampling of 2,374 advisors is smaller than a recent survey of 3,200 advisors published in Financial Planning but larger than the sampling of 1,000 advisors responding to a tech survey by Investment News.
A4A’s 4,500 members reflect a broad swath of private wealth advisors. Seventy percent of A4A’s members say they work at a Registered Investment Adviser (RIA) as an investment advisor (IA) rep, while 14% say they are registered reps, and 16% say they are “dually-registered" as an IA rep also licensed to sell securities.
Moreover, 67% of A4A members say they are owners of an advisory firm, while 18% say they are "professional staff," and 11% say they are "partners." Just 4% of A4A members say they are "staff." It’s fair to say that A4A surveys senior decision-makers in the private wealth advisory business.
With 10,000 unique visitors monthly, A4A has only about 10% the readership of those established publications. However, members are much more likely to respond to A4A practice management surveys than readers of other publications, perhaps because of A4A’s focus on practice management and way of engaging readers.
To be fair, A4A data also reflect the fallibility of all surveys of advisors: The results are highly dependent on the professional profile of the respondents.
Publications offering surveys of advisor technology act as though their data actually reflects independent advisor preferences. Truth is, however, that these surveys are unscientific. They reflect not only the biases of their authors but of the types of readers they attract as well as the resources expended and methodology employed.
It's like the story about six blindfolded men touching an elephant. Each one feels a different part, but only one part -- the side or the tusk -- and each describes the elephant very differently. Similarly, surveys of investment advisors touch one cross-section of the private wealth advisory business. Each survey by captures a slightly different segment of the invetsment advisor population, which does add to our understanding of independent advisors.
CRM Applications Used By Private Wealth Advisors
According to Advisors4Advisors survey results, Microsoft Outlook remains the No. 1 CRM application used by advisors. With 21.7% of the 2,374 A4A members responding to our poll saying Outlook was their CRM, Microsoft’s influence on advisors remains significant.
Notably, Investment News excludes Outlook from its list of apps because, it says, Outlook is not a customer relationship management app. Outlook is indeed a contact management app. Still, it is the closest thing to a CRM in so many advisor offices that A4A includes Outlook in its list of 16 choices advisors are asked about in collecting data on CRM systems.
Look for Outlook to make a comeback over the next few years as Web-based versions of Microsoft’s CRM are built by firms specializing in serving advisors and Microsoft’s mobile strategy emerges with Windows 8.
That Redtail is the most popular CRM among advisors in the A4A survey and others seems significant. It also does not surprise me. Advisors can always be relied upon to choose the lowest-cost solutions.
Redtail is a great value, however. How it matches up over the next few years against Salesforce will be fascinating. I’m rooting for Redtail and other entrepreneurial ventures of its ilk, but know Salesforce will attract many advisors.
Junxure is in the same position as Redtail in competing against Salesforce, which has been adopted by all of the major custodians. However, Junxure is handicapped because it is not a web-based app. Junxure is expected to launch a web-based version in the next year or so. Converting users to a new version when they can move to Salesforce will be a challenge.
To put in perspective our private wealth advisor CRM survey, it's helpful to compare its results to a survey of 1,100 advisors that I conducted in 2002.
In that survey, 35,000 readers of Investment Advisor and 750 advisors who were clients of Advisor Products were sent an email and invited to take the survey, which was the first-ever online poll on independent advisor technology. A quarter of the 1,100 respondents said Outlook was their CRM.
A decade later, although many more advisor-specific CRM apps and choices are available, Microsoft Outlook’s 22% market share has eroded only slightly from the 25% level of a decade ago. Advisors are alow to adopt new technology.
A couple of other observations on CRM apps over the past decade:
Junxure has grown amazingly. A decade ago, Protracker had about as many users as Junxure, according to the 2002 survey. ProTracker relative to Junxure has trailed off competitively. (Junxure-i and Junxure have since merged.)
The success of Redtail and Junxure reflect the entrepreneurial character of firms providing advisors with technology. Advisors using practice management apps provided by these privately-held companies should be aware of the risks.
These entrepreneurial ventures get acquired if they’re by larger companies, a trend I beleive likely to accelerate over the next decade. When an app you rely on gets acquired, it can result in a sharp change in the software company’s strategic plan and pricing. Advisors must have an exit plan and know exactly how to retrieve their data. See recent comments on A4A about how this issue can affect advisors.
Likewise, advisors choosing apps made by large corporate players like Salesforce should be aware of the risks they face. Large companies often don’t understand the advisor business and are don't tailor solutions to advisors and they're not as nimble privately-held software companies. A large user base can be a magnet for hackers and big companies don't all have a great record for respecting the sanctity of personal data, resulting in incidents like the scandal unfolding today involving Google.
.png)
.png)
