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Are Older Financial Advisors More Tech Savvy Than You Think?

A new industry-based survey finds that Baby Boomer and Generation X financial advisors are more mobile and technologically savvy than you might expect.

According to a Redtail Technology survey, Baby Boomer (52%) and Gen X (58%) advisory employees use mobile or tablet devices to access their company’s client relationship management (CRM) solutions slightly more than their Millennial counterparts do (50%).

The firm’s 2018 “Gen Tech” survey polled more than 2,000 wealth management employees from financial advisory firms across the country in an effort to understand trends about technology usage across generations, as well as client communication and succession planning.

The findings reveal that most Gen-Xers (89%) and Baby Boomers (86%) had little hesitation around adopting a CRM, suggesting that the wealth management community is more tech savvy than the industry previously acknowledged. It also suggests that CRM is occupying a more established position within the fintech space, the report observes.

But despite wealth management employees using tablets and phones to access their CRM, mobile usage across all generations still lags behind desktops and laptops, the report notes. This indicates that CRM mobility needs improvement across the industry, according to Redtail.

Software Usage

Not surprisingly, the use of technology systems within an advisory firm correlates with age, with Millennial respondents the biggest users of technology systems, followed by Gen-Xers and then Baby Boomers.

Across all generations, financial planning software (79%) is the most commonly used technology, followed by client portal (57%) and risk profiling and analysis technology (51%). In addition, only 9% of wealth management firms said they are using digital trading software, followed by 31% using compliance technology.

With respect to other software, the survey found that only a third of wealth management offices are using technology specifically geared toward compliance. While there are compliance features in other technology tools (e.g., documentation within their CRM, investment objective review and email archiving/reporting), Redtail suggests that the 33% statistic appears low, given the importance of compliance.

Digital trading software is similarly underutilized, according to the report, with only 9% of offices incorporating it into their technology stack. “Advisors may not be taking advantage of a tool that helps address the needs of less affluent clients without cutting into time reserved for more profitable clients,” the report suggests.

Succession Planning

Meanwhile, regarding advisors’ preparedness for the inevitable “aging” of the industry, the survey found that 77% of respondents are not part of a succession plan, either as a successor or impending predecessor. And while 16% of those surveyed across generations are successors, only 7% indicated they are retiring and have a succession plan in place, the report shows.

“The biggest eye opener for us was that all generations are seeing eye-to-eye on technology,” notes Redtail CEO Brian McLaughlin. “It’s apparent that the industry can no longer afford to overlook aging advisors as a target market, particularly those who need assistance on their succession planning strategies.”