Remote Financial Advice: Are People Open to It?

Traditionally, the relationship between a client and financial advisor is personal, conducted face-to-face and across the table. However, the evolution of technology, including tools such as the internet, smartphones, and video chatting software, enables a client to speak with an expert from anywhere.

While remote financial advice is becoming more prevalent today, not everyone is keen to adopt such an arrangement. And while it has its advantages, it may also be beneficial to stick with a more traditional in-person relationship. In this study, we’ll look at what percentages of people from various age groups would hire a remote advisor versus those who wouldn’t. Then, we’ll examine potential reasons for these responses.

What Is a Remote Advisor?

Remote or virtual advisors are professionals who correspond with you in an online or asynchronous capacity. For instance, this may be by phone, video call, or even a robo-advisor. Many large firms offer this as an option for clients, especially those with fewer assets under management (AUM).

Like a traditional financial advisor, remote professionals can still assist their clients with various services. This typically includes financial planning and investment management, but each firm’s services are likely to vary.

Who Would Hire a Remote Advisor

The increasing ubiquity of remote advisors can be a bit polarizing, especially for clients who have grown accustomed to building a traditional relationship. For this reason, we conducted a study that collected data on which age groups would be more likely to work with an expert virtually. The table below displays this information, as well as those who are unsure of which option they’d choose:

Age	Open to Remote	Not Open to Remote	Unsure
Younger than 30	78%	5%	17%
30s	77%	6%	17%
40s	71%	9%	20%
50s	64%	12%	24%
60 and older	53%	18%	29%

The data above illustrates that over half of each age segment in the survey is open to a remote arrangement. However, as the age tops out at 60 or older, the percentage of people who wouldn’t hire a virtual advisor increases to 18%, with 29% being unsure, indicating that older clients may be less willing to shift to a less personal, more technology-reliant relationship.

On the other hand, the data underlines that respondents who were 40 years old or younger tended to be more accepting of a remote advisor arrangement. As we’ll expand upon later, there could be several reasons for this. Chief among those is an existing familiarity with technology and the need for cheaper options, which may not be readily available in their ZIP code.

Why People Prefer Local Advisors

While remote advisors are becoming more common today due to their convenience, there are still reasons why people may opt to meet in person. Entrusting someone with your money is a big step, so, logically, some may prefer to build a traditional relationship face-to-face. In other cases, some, such as those in older age brackets, may be less likely to adopt new technology, such as video chatting and robo-advisors.

Andrew Bellak, a partner and wealth advisor at Perigon Wealth, explains, “For some clients, at least initially, they want to meet someone in person,” adding that others may “have an affinity for local community.” Additionally, some who are either “not facile with technology” or “wary of technology being too integrated in their life” may not be as comfortable working with a professional virtually, says Bellak.

For both client and advisor, the importance of a personal bond can’t be understated. Meeting in person allows clients to build a rapport with an expert, making the working relationship more natural and comfortable. Tyler Meyer, CFP, founder of Retire to Abundance, summarizes that “there is a redeeming value to being able to look your clients in the face.”

Why People Prefer Remote Advisors

Based on the data above, most people are at least willing to meet with a remote advisor. While this is a sign of technological advancement, there are other more specific reasons this is the case. For many, working with a professional or firm online is much more convenient than physically visiting an office. It also gives you access to cutting-edge technology and top-tier talent that traditional firms may not have.

When looking for an in-person advisor, you’re generally limited to options in a reasonably drivable radius, or you may not have any around you at all. Unfortunately, this may mean you have to make sacrifices on services if a firm doesn’t offer it or settle with a less-than-ideal option. With a remote professional, you instantly gain access to financial advisors all around the country.

The shift to asynchronous arrangements also widens the field for both clients and firms. Carrying extensive experience working in and owning registered investment advisor (RIA) firms, Bellak says he has “clients who live around the US and also in France, Germany, Canada and Africa.” Similarly, regarding employment, he points out that virtual financial advice “allows companies to attract top talent when that talent prefers to stay where they live rather than relocate.”

While people aged 60 or older are less likely to hire a remote advisor than their younger counterparts, over half of respondents are open to the idea. Why does it make sense for older clients? Per Bellak, “some clients are immunocompromised and therefore remote is safer.” This is an especially relevant factor today due to the recent COVID-19 pandemic, which made remote meetings a normal part of everyday life.

Another reason older clients may prefer remote is that it eliminates “travel time,” making life easier for both the advisor and client, continues Bellak. This is especially true for elderly individuals who have trouble driving as they age.

Finally, hiring an online expert may end up being cheaper. Most firms require a smaller account minimum to meet with a virtual advisor than an in-person one. And, without the overhead for an office, you might pay a smaller fee.

Companies That Offer Remote Advisors

At present, many firms offer remote financial advisor services. These are often large organizations but can be small companies as well. The table below lists a handful of the largest RIA firms that offer virtual services:

Financial Advisor Firm	Remote Services
Charles Schwab	Financial planning, investment management, wealth management
Fidelity	Investment management, including tax-loss harvesting and annual portfolio reviews
J.P. Morgan	Financial planning and investment management
Morgan Stanley	Financial planning and investment management
Vanguard	Financial planning, investment management, and tax-loss harvesting

While the firms above may fit the bill, conducting thorough research to find the firm that aligns with your needs is best. We recommend using this free matching tool to help you narrow your search. After filling out a short form regarding your current finances and goals, it’ll present you with an advisor tailored to your unique situation.

Future of Financial Advice

Regardless of how clients may feel about it, remote financial advice is likely to stick around now and in the future. Contributing factors like the COVID-19 pandemic and the advancement of asynchronous communication both make firms and society more comfortable with remote than before. Bellak believes that the “remote or decentralized model is here to stay” because it “works for the advisor-client relationship and it also works for the overall RIA management.”

It’s also worth noting that, as younger people who have grown up with increased technology get older, they may be more likely to pursue remote financial advice rather than in-person. Today’s elderly population lived in a time with no internet. But if you fast forward 30 to 40 years into the future, much of the middle-aged to elderly population will have experienced some kind of remote arrangement, making them more comfortable with a virtual set-up that doesn’t require office visits.

Are financial advisor offices destined to be obsolete at some point? It’s difficult to say. Based on the current data, more and more individuals are becoming open to remote, including those over 60 years old. However, we can’t say with great certainty that this spells an inevitable end for traditional office consultations. What’s clear, though, is that the remote model is likely to be a permanent facet of the financial advisor industry, co-existing with in-person visits with a professional.

Methodology

The data used in this article is based on an anonymized survey conducted by Datalign Advisory, LLC, a partner of ComparisonAdviser. Respondents are prospective clients searching for financial advisor firms in their area. In the survey, participants were asked questions regarding their age and openness to remote investment management and financial advice.