What's on the agenda for INVEST 2022

8 topics advisors are prioritizing at INVEST 2022

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What’s new in financial technology is top of mind among senior wealth management leaders and decision-makers from across the industry making the trip to Financial Planning’s annual INVEST conference on June 16 at the Hilton Midtown in New York City.

From the latest developments in wealthtech and cryptocurrency education to holistic planning, sustainability and other trends, here are eight topics that wealth managers are prioritizing at the event this year.

Direct indexing

Seattle-based boutique Parametric recently saw its assets under management reach $428 billion. The secret of the firm’s success? Creating a portfolio that acted like an index with an eye on post-tax performance, the template for direct indexing.

“There’s a changing perception of what investing for private wealth should be and how advisors focused on private wealth should act,” said Parametric CEO Brian Langstraat. “Advisors are moving away from stock selection to [concentrate on] asset allocation and financial planning.”

While some doubt that direct indexing will make headway among mass market investors, Charles Schwab, Goldman Sachs and J.P. Morgan are among several top firms that are buying into the strategy.

Read more:

The rise of direct indexing

Cryptocurrency

Crypto as an emerging asset class has the attention of the investment management world, but many advisors are skeptical about incorporating digital assets in client portfolios. That is about to change if Ric Edelman has his way.

As a successful advisor who built a $271 billion independent advisory firm, Edelman has become a fervent crypto advocate via the Digital Assets Council for Financial Professionals, which he co-founded.

Dedicated to “advancing your knowledge of blockchain and digital assets,” the DACFP provides resources and online education for advisors, including certification in crypto, which Edelman hopes will better prepare them for those all-important crypto conversations with clients.

Read more:

Crypto certificates and advisor skepticism with Ric Edelman

Technology investment

Whether you’re a well-established wealth management firm or starting your own advisory business like Next Gen Wealth founder and CEO Emlen Miles-Mattingly, it is critical to recognize how technology will factor into your success.

Going all in on tech investment and “having a real vision for where you want to see your business is what keeps you from falling behind,” said Miles-Mattingly. “And the work is never done because there’s always something new or a few more things that we can do as a firm to make things easier for our clients.”

Miles-Mattingly is not alone. While wealth managers anticipate some challenges, they see the value of leveraging technology and having a digital transformation strategy to position themselves for the future.

Read more:

Betting big on tech to future-proof wealth management

Holistic planning

Holistic financial planning is on the rise in the retail wealth management sector, with nearly half of advisors optimistic about growing their holistic planning capabilities, according to a recent Broadridge report.

“Holistic planning is where you’re able to help your clients navigate any question or situation that involves a dollar sign,” said Jason Noble, a managing director at Prime Capital Investment Advisors. “As the fiduciary in a holistic way, we examine their portfolio constructions coupled with their investment plan, corporate tax plan, retirement plan and income sources distributions.”

Separately managed accounts are also becoming more popular with firms specializing in holistic planning, although some advisors stay away from them because of the relatively high management fees.

Read more:

Financial advisors building up holistic planning capabilities

Portfolio management

Interest in cryptocurrency has continued to grow over the years, with 80% of advisors regularly fielding questions on the topic, according to research from Cerulli Associates.

Not all clients “necessarily need advice on what to invest in and what not to invest in,” said Samuel Deane, founder of Deane Wealth Management, who works exclusively with millennials. “They just need some expert opinion on how crypto fits in their overall financial pictures.”

With investor interest on the rise, expert opinion on crypto and understanding this emerging asset class are likely to be key for advisors looking to acquire new clients.

Read more:

Crypto becomes the new battlefield for financial advisors to win over clients

ESG

Not so long ago, sustainable investing based on ESG principles was just a niche concept. Today the practice has gone mainstream.

With it has come a new concept and subsequent practice known as greenwashing, or conveying a false impression or providing misleading information about how the products or services of a company are being sustainable.

For advisors new to sustainable investing and looking to maintain the integrity and mission of these investments amid the rush to get involved, asking the right questions can help them steer in the right direction.

Read more:

3 ways to avoid greenwashing with sustainable investments

Practice and client management

Digital, and specifically via mobile apps, is the future communication channel of choice for 89% of investors from ultrahigh/high net worth, millennial and baby boomer groups, according to a ThoughtLab study on the impact of digital, social and regulatory change on the industry.

The preference for digital extends to the continuation of virtual conferencing over in-person meetings across all demographic and asset brackets, debunking the notion that older and wealthier clients favor in-person communication.

Read more:

Digitalize to survive: Meeting evolving expectations of ultrahigh net worth investors

Advisor trends

The overall number of advisors is set to decline in the next few years, with more than 33% retiring by 2029, according to research from Cerulli Associates.

There will, however, be no reduction in the number of challenges for them to think about, the findings in Cerulli’s data-driven first quarter U.S. Advisor Edition study suggests.

From the competition for talent to mergers between independent advisory firms, advisors will have their hands full and need to stay on top of the latest developments.

Read more:

6 major trends for financial advisors in 2022: Cerulli study