You’re Not Alone: Exploring Top Advisor Challenges

Ongoing account servicing, managing models, incorporating alternatives, tax management, multiple logins... For financial advisors, these frustrations might sound familiar. By smartly incorporating technology and selectively outsourcing, financial advisors may be able to optimize efficiency by shedding activities that distract from the central mission: growing your firm and winning new clients. 

While every RIA practice faces unique challenges, there are a few common themes we hear from most of our clients. This blog takes a look at some of the top challenges faced by advisors and the tools you may want to consider for your own RIA practice.

1. Trading and Operations ➜
2. UMA Complexity ➜
3. Alternatives ➜
4. Tax Management ➜
5. Advisor and Client Experience ➜

Challenge #1

Trading & Operations

Is ongoing account servicing bogging your team down? To help maximize firm value, you may be able to reduce fixed operational costs by outsourcing the trades that don’t require manual oversight to a trading partner.

• Problem: Key person risk and rising middle- and back-office costs constrain scalability and efficiency. Plus, it's burdensome to hire and train additional staff as your AUM base grows.
• Solution: Instead of hiring an in-house team, you can outsource your model trading to our experienced team of traders who leverage modern technology – less Excel spreadsheets can mean less potential for error. GeoWealth handles the majority of middle- and back-office operations, including trading, reconciliation, aggregation, and cash management, while your team continues managing the models and directing service requests to the GeoWealth team via our Service Center.

Challenge #2

UMA Complexity

Do you struggle to manage models consistently across multiple accounts? Many RIAs do not have access to Unified Managed Account capabilities, which means multiple accounts, disjointed performance reporting, and manual analysis for rebalancing.

• Problem: Multiple strategies across separate accounts create operational friction and limit customization. Oftentimes, manual data manipulation and analysis is required to complete multi-account performance reviews and rebalancing processes.
• Solution: GeoWealth enables multiple different advisor-managed and third-party models to coexist within a single Unified Managed Account (UMA), while still offering flexible allocations and effectively unlimited permutations. A UMA allows an investor to aggregate assets but separately manage different “sleeves,” or asset groupings. From allocation optimization to enhanced transparency and cost-efficiency, UMAs present a compelling solution.

Challenge #3

Alternatives

Are you looking to incorporate semi-liquid alternatives into client portfolios, but struggling to do so at scale? Some advisors are beginning to allocate 20% to private markets as high-net-worth clients seek diversified return sources beyond public markets. RIAs now have several options for incorporating private markets into client portfolios via ETFs, interval funds, and model portfolios.

• Problem: Client demand for alternatives is growing, but implementation within model portfolios is operationally complex and often requires multiple vendors.
• Solution: GeoWealth supports evergreen alternative structures within model portfolios, materially reducing operational risk and vendor sprawl by seamlessly integrating subscription documentation workflows. Through our UMA framework, RIAs can now allocate to and implement evergreen accredited investor alternatives alongside mutual funds, ETFs, and equity SMAs within their own models or via asset manager-designed custom models. The operational benefits are equally compelling, as these integrated solutions deliver meaningful reductions in operational burden and increased time savings.

Challenge #4

Tax Management

How are you proactively managing taxes across client accounts today? Advisors often want to allocate client assets into models, as models provide the ability to scale and grow their businesses; however, capital gains often create a tax hurdle that slows model adoption.

• Problem: Client transitions and appreciating markets make tax management increasingly challenging.
• Solution: GeoWealth’s tax tools – including Tax Transition and Tax-loss Harvesting – support seamless transitions into model portfolios and automate the ongoing management, significantly reducing realized gains and opportunistically harvesting losses throughout the year. Our platform helps advisors manage the trade-off between tax efficiency and portfolio alignment to align clients to models.

Challenge #5

Advisor & Client Experience

Are you tired of juggling multiple logins and systems? Building your own tech stack might sound empowering, but it can be debilitating.

• Problem: Fragmented systems across custodians and technology vendors make it difficult to deliver a consistent, well-governed advisor and client experience.
• Solution: GeoWealth delivers a private-labeled, multi-custodial platform instance. A Turnkey Asset Management Platform (TAMP) can encompass CRM, billing, aggregation, reporting – and more – in one place. That means fewer logins, but also more integration since each facet of your operation is connected and sharing the same data. 
  
  

We’re here to help.

GeoWealth is a modern financial technology and Turnkey Asset Management Platform (TAMP) built specifically for RIAs. Whether you’re a firm with two people or two hundred people on staff, there’s a case for outsourcing to a Turnkey Asset Management Platform (TAMP) like GeoWealth.

Schedule a demo with us today to see how our technology and investment solutions can alleviate these top advisor challenges and more.

DISCLOSURE:

This is not an endorsement or testimonial of any product or service. The information contained herein does not constitute investment advice or a solicitation. This article is for dissemination of general information only. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. Investments are not guaranteed and are subject to investment risk, including possible loss of the principal amount invested. Past performance is no guarantee of future results.

The tax transition tools are intended to assist advisors in offering their own tax-efficient advice to clients. These tools do not constitute tax advice from GeoWealth. Advisor is solely responsible for determining whether tax transition tools are suitable for clients and whether the securities held meet the client’s intended investment objective. Advisors are required to regularly review the gains and losses generated in client accounts and make adjustments to the client’s tax transition settings as necessary.

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