Advisers who have adopted managed accounts see considerable benefits including saving 14+ hours per week according to new research by BT and undertaken by Investment Trends.
The research shows that among advisers who recommend managed accounts, the benefits to their business include:
- Time savings of 14.4 hours per week, on average, in administration and compliance work
- Allowing 4.8 hours per week, on average, for business development activities and for more time in front of existing clients
- Ability to service more clients, potentially generating additional revenue of $45,000 p.a. from advice fees
BT’s National Manager of Product Development, Russell Brinckley said the findings demonstrate why the take up of managed accounts is growing so rapidly as advisers seek new ways to save time, reduce paperwork and have more time to spend on holistic advice.
The areas that advisers want to focus on in 2017 are: ongoing client engagement (61 per cent), building efficiency in their practices (53 per cent) and client acquisition/prospecting (45 per cent).
Use of managed accounts has increased for the fifth consecutive year1 with a quarter of advisers (26 per cent) now recommending these solutions, up from 22 per cent in 2016 – the largest year on year increase to date.
Intention to recommend managed accounts is also strong with a further 20 per cent of advisers intending to recommend managed accounts in the near future.
“Despite historic perceptions that managed accounts are the domain of high net worth (HNW) clients, advisers are increasingly seeing opportunities for managed accounts among their broader client base. Our significant investment in new-age technology, the Panorama operating system, has enabled managed accounts to go mainstream. We are really pleased with the enthusiastic feedback and take-up of our SMA and MDA solutions,” said Mr Brinckley.
The research showed advisers had a wide range of reasons for recommending managed accounts but the most popular were investment transparency (64 per cent), greater practice efficiency (62 per cent) and access to professional investment managers (46 per cent).
“We think managed accounts are the natural next step in practice efficiency, providing advisers and licensees the opportunity for scale, to be more nimble and to deliver more personalised advice to more clients,” said Mr Brinckley.
About BT Panorama’s managed accounts:
BT Panorama’s managed accounts delivers a wide range of portfolio solutions, providing the level of control advisers prefer for their business, helping advisers maximise efficiency and transparency. BT Managed Portfolios is an “off the shelf” solution, with more than 50 different portfolios, offering a wide range of investment styles and asset classes. BT Panorama also offers tailored portfolios, the full DIY solution, for advisers with their own Managed Discretionary Account (MDA) license or using an external MDA provider.
About the research
The BT/Investment Trends Managed Accounts Research Paper details the results of a quantitative online survey of financial advisers conducted between 5 and 17 July 2017.
Total responses after data cleaning and validation: n=233 financial advisers, including RG146 compliant accountants and principals/business owners who personally provide advice. Managed accounts users: 85 financial advisers and Non-users: 148 financial advisers
BT’s Managed Accounts Research Paper was conducted by Investment Trends. The survey examines the effect of using managed accounts in financial advice businesses.
1. Source: Investment Trends April 2017 Planner Direct Equities & Managed Accounts Report
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