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The Digitally Consistent Advisor: Why Financial Advisors Need to be Digitally Consistent with Their Referral Partners

2020 and 2021 are rapidly changing the financial planning industry: think virtual everything! Which is why we turned to CFP Derek Notman for his expert advice.

Derek Notman

Derek Notman, @DerekNotmanCFP

CFP & Founder, Conneqtor


The virtualization of financial advice, and advisors, has progressed more in the last 12 months than arguably any other time in the history of the industry.

COVID-19 forced the world to evolve and adapt.  Some were ready and in fact the consumer and technology had already figured out how to embrace digital & virtual a long time ago.

The financial advice industry is typically late to the evolution party and the estate planning industry usually arrives about the same time.

The silver lining is that things have evolved and the way we conduct business has improved.  

Financial Advisors are Going Virtual

Before the pandemic was on our radar, forward-thinking advisors were already transitioning to a virtual or semi-virtual model.  Whether you cite the 2019 McKinsey study, The Virtual Financial Advisor, that clearly shows over 42 million households were already prime candidates for virtual advice, or Michael Kitces article back in 2015, The Emergence Of The “Location-Independent” Virtual Financial Advisor, it is clear things have been changing for some time.

Since the financial advice industry is slow to evolve, they tend to focus on using outdated strategies & tactics.

Working only in person, having a brick & mortar office, hiring W2 staff, using paper files, the list goes on.  These are things we have done as advisors forever.  They work until they don’t work anymore and 2020 showed us all that those old ways are quickly becoming obsolete.

Advisors are now quickly focusing on improving their tech stack, learning how to work remotely, figuring out how to deliver advice digitally, learning how to do this thing we call “digital marketing”, building virtual teams, and so on.

Although most advisors have been forced into these changes, they are fast realizing just how important they are.  Not only are they learning how to thrive in a digital age, but they are answering the virtual/digital call that the consumer is demanding.

Financial Advisors are Centers of Influence

In the normal course of working with clients, financial advisors end up discussing a lot more about their financial situation than just investments, insurance, and planning.  For example, we routinely talk about taxes and estate planning when working with our clients.  Although it’s not our job to help them in these areas, we should know enough about how they can impact a client’s situation and then refer out to professionals that can help.

As the quarterback of a client’s financial life it is our duty to make sure they are working with the right people, professionals, services, etc. to make sure the client accomplishes all that is important to them.

In the past we did this through networking.  Getting to know other professionals that can compliment the work we do and vice-versa.  When advisors were primarily brick & mortar it was only natural to associate with professionals in different industries who were also brick & mortar.  With professionals that were in the same ZIP code or at least within driving distance.

Well, times have changed.

Financial Advisors Must be Digitally Consistent with their Referral Partners

New amazing digital client portal.  Amazing virtual meeting experience.  24/7 online access to accounts.  eApplication capability.  Robust digital marketing.  Virtual support teams.

These are the types of things financial advisors are embracing and providing for their clients.

These are the types of things clients expect from virtually all providers they do business with.

The potential problem is when advisors refer professionals who are not digitally consistent.  As we all know, referral partners are to be cherished and are often viewed as an extension of us, our practice, a value-add.  

Refer a client to a bad referral partner and you look bad.

So, what happens to a financial advisor who is forward-thinking, digital, virtual, and rocking a modern client experience when they refer out to a professional who is stuck in 1985?  Well, for starters, there’s a major disconnect.

Think about it.  You just onboarded a new client.  They loved your virtual/digital experience.  They loved the convenience of doing everything remotely.  You then refer them to get their estate planning done and they can’t find, let alone vet the attorney online, and when they do get ahold of them over the phone they are told to schedule an in-person meeting (one of many) to get all of their estate planning done.

It’s night and day difference and reflects poorly on the advisor who referred the professional.  This is as inconsistent as we can get!

The Best Financial Advisors are Doing it Differently

Financial advisors who understand this “digitally consistent” pitfall are the ones who will proactively find referral partners that are extensions of their client experience.

For example, instead of just referring local attorneys to your clients why not use a fresh, modern service like Trust & Will when referring out your estate planning?

And on the flip side, forward thinking attorneys, accountants, etc. who are offering a great digital experience will also want to refer to advisors who are doing the same.

It’s a digitally consistent feedback loop!

Times have changed my advisor friends.  Sure, change comes with growing pains, but not growing means you are slowing dying, which is worse?

Want to learn more, make sure to check out the rest of the Trust & Will site, check out my Financial Advisor Blog, and connect with me on LinkedIn.

Best Regards,

Derek Notman