3 themes shaping modern advice firms in 2023 revealed

A new report has found that success in the coming years will depend on three factors, beginning with a firm’s capacity to showcase the advantages of pursuing a career in financial planning and attract talent; its ability to team up with the right business partners; and, lastly, its readiness to evolve its business model to capture opportunities arising from regulatory change.

The report Advice trends and opportunities: 2023 and beyond, released by Desktop Broker, the wealth management arm of Bell Direct, pinpointed ample opportunities for advisers to grow their business. 

Commenting on its findings, Arnie Selvarajah, Bell Direct chief executive, said that there are three fundamental building blocks that must be in place first to ensure a rock-solid foundation. 

“The right people and culture is key but there is a war for talent going on right now so advisers need to sell a career in advice and get creative about the benefits and flexibility they offer,” said Mr Selvarajah.

“Even then, every business has finite resources, so they need to leverage the capabilities and expertise of trusted service providers to help them evolve and execute their strategy,” he noted. 

The paper draws on insights from Desktop Broker’s client base of financial advisory firms. 

Tim Sparks, Bell Direct head of distribution and marketing, said the most profitable and efficient businesses are those that leverage technology extensively, allowing them to derive scale benefits by improving their delivery of advice and investment solutions.

“With increasing economic uncertainty, advisers are focused on adding value in the areas within their control such as budgeting and cashflow management, portfolio management, and retirement planning,” Mr Sparks said.

“We are seeing the increasing adoption of managed accounts as advisers seek to drive efficiencies, better manage their exposure to risk, and deliver a better client experience.”

Moreover, he added that the return of inflation has sparked a rethink of advice models. 

“We’re seeing traditional stockbrokers and private client advisers move into strategic financial advice because they recognise that it is going to get harder and harder to outperform under current market conditions.”

The report added that after a period of instability, the forecast for the financial advice industry is looking positive, supported by talent returning to the industry and a more accommodative regulatory environment.