INVESTIRE | March 2024
What will the financial advisor be like in ten years? Predicting the future is always a bit risky, especially in a sector that is experiencing profound changes, such as that of financial consultancy.
Starting from five facts makes this exercise a little simpler, let’s see what they are and what impacts they could have on the future of the profession.
The first, and most important, starting point is that, for two years now the number of financial advisors with an active mandate has not only not increased but has actually decreased.
The theme of the inclusion of new recruits – not necessarily young people with their first experience – concerns many professions, just think of doctors, craftsmen and in general all those professions which as such cannot be improvised but require experience and a medium-long apprenticeship.
Even in the case of financial consultancy, thanks to the reduction in intermediation margins, the concentration process is leading to a smaller number of professionals but with much higher portfolios than in the past, effectively raising a further barrier to entry.
The second fact is that one of the antidotes to the disappearance of the financial advisor profession is to draw on the pool of other professions, for example bankers: tens of thousands of them who work in branches will soon have to find another way of working due to their inexorable closure.
The third fact is that the work of the financial advisor – once a free agent – is transforming into group/team work: protection, supplementary pensions and access to credit are alongside financial planning and require distinct and complementary skills.
The fourth fact is that the acceleration that digital is giving to all professions will not spare that of the financial advisor; the more or less wise use of Artificial Intelligence – the latest arrival – and, in general, the evolution of digital platforms will divide the world into dinosaurs, destined for extinction, and innovators for whom a future will be reserved.
The fifth fact is that, like it or not, sooner or later the current consultant commission system based on product rebates will disappear and not necessarily due to an intervention by the regulator on duty, but because the customers want it that way.
This does not necessarily mean that the consultant of the future will be less remunerated than today, but that he will be remunerated differently, perhaps even better than today, provided however that he is able to demonstrate the value of his consultancy and therefore get paid for it.
If everything goes as planned, in ten years we should have a greater number of professionals (+10%/15% compared to today), with an average age between 55 and 65 years (+5 years on average compared to today), with an average portfolio double that of today, who will work in a team in 80% of cases and who will be paid by fee in 75% of cases.
The financial advisor of 2034 will serve a larger clientele (+50% than the current one) and an even more well-equipped one (private share from 40% to 70%).
Conversely, those who cannot or do not want to use a consultant will use increasingly digital and remote banks or, on the contrary, those few that will be able to maintain a strong territorial presence such as the Post Office.
Nicola Ronchetti