The managed accounts conversation

Strategies

Eylem Kamerakkas
Thursday 31 January 2019

Looking back at the last 12 months, the wealth management industry has been under some scrutiny. Analysing and understanding the ramifications of this helps us see where the industry is heading in 2019 and beyond.

In the current climate, industry change is inevitable so managing client expectations and focusing on client centricity will be even more critical in driving outcomes – in fact, personalising the client experience is going to be key to winning in the battlefield for differentiation.1 This means that institutions and financial professionals alike will need to hone in on their business models, value propositions and the products and services they offer to continually match this expectation.

Being able to evolve with the industry has always been vital, but being able to change with your clients will be even more critical in this highly competitive and regulated market - that’s where managed accounts may be the answer.

Our own Sherise Mercer spoke to this in early 2018 summarising that, “Managed accounts free up advisers to spend more time identifying client goals and developing new ways for achieving them. It’s an important opportunity to firm up your position as a strategic adviser.”

This article will tackle the strategic conversations you can have to help drive this outcome and ultimately strengthen your relationships with your clients.


Re-focus the conversation

It’s no news that each client requires an individual approach however, with so many administration and portfolio change conversations to be had it’s easy to get caught in the trap of having the same communication approach and engagement model for everyone. The practice and administration efficiencies that managed accounts offer help to free you up so you can tailor the frequency and style of engagement to suit your client’s preferences and lifestyle.

As the portfolio parameters are agreed upfront in the model selection phase, conversations thereafter are less about portfolio changes and corresponding authorisations but more about strategic matters and forward planning. This gives you more time to focus on connecting with your client by understanding their life goals, needs, objectives and financial aspirations and to keep in touch between meetings by sharing industry, market/investment updates that relate to them and their circumstances. Having the fortitude and time to pivot like this will enhance your relationship with your clients and position you as more of a “financial coach” – equipping you to educate and guide your client’s through their life journey by managing and preparing them both financially and strategically for the unknown.

This level of personalised service and regular contact will not only serve to foster deeper relationships but also lead to better outcomes as you’ll be more in tune with your clients’ changing needs and expectations – giving you greater scope to respond in a far more timely manner.


Saved time and better service

The pace of innovation and disruption, particularly in the past five years, has been extraordinary and ultimately presents greater choice for clients and advisers alike. The demand for a better, faster service with real time engagement and seamless digital connectivity is no longer considered a service feature, it’s a given.

Additionally, the scrutiny faced by the industry is driving clients’ expectations around transparency and highlighting the value in understanding their investments more. The managed accounts solution provides clients with added portfolio transparency, beneficial ownership of underlying assets and individual tax outcomes. In some instances, there is even further scope to customise the solution by taking into account a client’s personal preferences around environmental, social and corporate governance matters – an important feature that resonates with many clients and is likely to be even more pertinent for the socially conscious ‘intergenerational clients’. These benefits have the propensity to be even more impactful with the adage of continued investment and focus by managed account providers as they strive to ensure continued alignment to changing client expectations.

Put simply, managed accounts give you back time to focus on the things that matter most to you and your clients and the people who are most important to them. Through the use of managed accounts advisers have reported an average time saving of 12.4 hours a week2, time which can be spent not only directly with clients to strengthen that relationship but also connecting with their partner and broader family. By understanding your client and their circumstances in all sense of the word, you’ll be equipped to provide a ‘whole of household’ solution – evolving to become the trusted ‘inter-generational’ adviser is going to be a powerful value proposition for any adviser. This role is going to be even more imperative with the upcoming intergenerational wealth transfer – in the next 10 to 20 years an estimated $3 trillion is expected to change hands as baby boomers pass on their wealth, making it the largest in Australian history.3


What next?

If you’ve been thinking about managed accounts, we have a team of specialists to support you from the initial discussions to implementation with ongoing service to ensure that you and your clients reap the benefits of managed accounts as quickly as possible.

And with close to two decades of experience, over 150 existing SMA models available on our platform and the ability to choose to either buy partner or build managed accounts, we’re the smarter solution for you and your clients.

 

Request a call today.

Share this

If you enjoyed reading this article, why not share it?

Simply copy and paste the text and include a link to the article. Please read the Expertise Articles Terms of Use before sharing.

Related articles


 

Find out how we can help


If you'd like to speak to a specialist about how we can help build your business, get in touch.

Subscribe to our monthly newsletter

We bring you technical updates, financial insights and industry expertise.

Newsletter shown on desktop, ipad and mobile
Thank you for subscribing.
There seems to be an error with your request, please contact us.

Simply fill out your details below:

The information you provide on this form will be retained and handled by Macquarie in accordance with our Privacy Policy and we may contact you about products or services we feel may be of interest to you. If you do not wish to provide all details or receive information of this nature, please phone us on 13 62 96.

1 Macquarie AFS Benchmarking Report - 2018

2 Advisers on average are saving 12.4 hours a week on portfolio management tasks, right through to advice delivery, implementation and execution - Investment Trends Managed Account Report (February 2018) based on a survey of 841 financial planners.

3 Largest intergenerational wealth transfer to come – AFR, 6 Dec 2017, Mark Smith, Group Executive Perpetual Private

Important information

Macquarie Investment Management Limited (MIML) ABN 66 002 867 003 AFSL 237 492 is not an authorised deposit-taking institution for the purposes of the Banking Act (Cth) 1959, and MIML’s obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542. Macquarie Bank Limited does not guarantee or otherwise provide assurance in respect of the obligations of MIML.

This information is provided for the use of financial services professionals only. In no circumstances is it to be used by a potential investor or client for the purposes of making a decision about a financial product or class of products.

The information provided is not personal advice. It does not take into account the investment objectives, financial situation or needs of any particular investor and should not be relied upon as advice. Investors should consider the appropriateness of the information having regard to their own objectives, financial situation and needs. Any examples are illustrations only and any similarities to any readers’ circumstances are purely coincidental.

While the information provided here is given in good faith and is believed to be accurate and reliable as at 3 August 2018, it is provided by MIML for information only. We will not be liable for any losses arising from reliance on this information.

MIML and Macquarie Bank Limited do not give, nor purport to give, any taxation advice. The application of taxation laws to each client depends on that client’s individual circumstances. Accordingly, clients should seek independent professional advice on taxation implications before making any decisions about a financial product or class of products.

Copyright 2018 Macquarie Investment Management Limited.

Except for Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502 (MBL), any Macquarie entity referred to on this page is not an authorised deposit-taking institution for the purposes of the Banking Act 1959 (Cth). That entity's obligations do not represent deposits or other liabilities of MBL. MBL does not guarantee or otherwise provide assurance in respect of the obligations of that entity, unless noted otherwise.

Important Information

Restricted to financial services professionals

This information on this website is provided for the use of financial services professionals only. In no circumstances is it to be used by a potential investor for the purposes of making a decision about a financial product or class of products.

In order to proceed, please confirm that you are a financial services professional by clicking 'I accept'.