DENVER — Financial planners are preparing to adjust their businesses and processes to better meet the changing needs of clients, according to research from the Financial Planning Association and Allianz Life Insurance Company of North America.
The study, conducted last year, surveyed 387 financial planners and found that 88% plan to learn more about their clients’ values and beliefs to better incorporate them into financial plans. Additionally, 74% said they will spend more time managing client relationships.
With a changing landscape in the years ahead, the research indicates what financial planners will focus on as they adapt to meet client needs, said Claudia Kane, president of the association.
While the research focused on one set of professional advisors, the premise of its findings could apply to others, such estate planners, accountants and lawyers.
About 67% of planners said they plan to modify their business models to accommodate clients who prefer a collaborative approach. Younger planners, particularly Millennials, were more likely to anticipate making changes than older generations.
The research also revealed gaps in communication between planners and clients. For example, 91% of planners said they discuss the risk of running out of money in retirement, but only 28% of clients recalled having those conversations.
Planners identified several key challenges, including regulatory changes, the need to engage younger generations, and time constraints. Only 8% of respondents said they had made significant changes to their approach, citing competing priorities and a lack of systems as barriers.
Efforts to diversify teams and clients are also growing. About 71% of planners said they aim to recruit diverse professionals, while 65% plan to serve a broader client base, which will allow their businesses to grow. Specialized firms are focusing on building teams with varied skill sets to address unique client needs.
The study highlights the increasing importance of collaboration and proactive communication as financial planners adapt to industry shifts.
The research findings were part of the Allianz 2024 Annual Retirement Study. Read the announcement on the study here.
