When I was a kid my parents gave me this advice: get good grades, go to college and pursue a profession that delivers a decent living. If you’re good at english and history, you should become a lawyer. And if you are good at numbers, become an accountant. Later I became a financial planner. I guess the numbers had something to do with that. And if I were to be successful in my profession as a financial planner, there was only one thing to do: get my CFP (or in Holland it’s the Master of Science grade). Professor Peter Drucker gave these professions a somewhat wanky name: knowledge workers. “Knowledge workers are people who get paid for putting to work what one learns in school rather than for their physical strength or manual skill”, according to Drucker. Compared to the time when I was a kid and today there has been a major change in the supply of knowledge and information. Which has an underestimated impact on the role of the financial planner. There has been an explosion of online electronic databases of financial information. In a typical year about one hundred million people worldwide go online for financial information and visit tens of thousands financial websites. And today, dozens of inexpensive information and online advice services are reshaping the work of financial planners. As people self-diagnose, tap the same reservoir of information available to financial planners and are using the online inexpensive advice services, these tools will be transforming the financial planners role from knowledge-advisor to emphatic advisor on options. The result is that the financial industry may be on the verge of fundamental changes that could reduce the demand for traditional services and force financial planners to lower fees. The financial planners who remain are the ones who can handle the more complex problems. But for most planners these developments are changing the emphasis of financial planning. Away from routine, analytical and information-based work. Toward empathy, narrative finance and holistic care. That’s something what databases, information and software simply cannot offer.
Do You Believe That Automation Changes The Role of the Financial Planner? Please let me know by leaving a comment.