INTERVIEW: Adding Value To Wealthy Clients With A "Vault"

Tom Burroughes

2 March 2017

In an age when much investment management seems to be increasingly commoditized, the “value-add” of a wealth advisor has to be around how well it counsels clients, looks after their affairs and keeps ahead of what might keep customers awake at night.

And one source of angst that might contribute to sleepless nights is keeping track of all the documents - paper and digital - that accumulate in a person’s financial life, as well as making sure that all the facts and figures around such a life can be found in one, secure, spot. Having such a secure, efficient “vault” for a client makes sense.

At the Philadelphia-headquartered Wescott Financial Advisory Group, a RIA firm with a footprint now across the US, the idea of creating such a vault has become reality with the recent launch of myWescottVault™, a cloud-based service that can be used by clients and advisors alike.

The idea of keeping all clients’ data and reporting from the business side in one place is something that might not have been on the radar about 20 years’ ago but is taking root among wealth managers, Matt Regan, Wescott’s chief operating officer, told this news service last week.

“This sort of technology is filling a gap,” he said.

“This is a two-way tool; it is a place for clients to deposit documents and relevant information for us; it is a secure passageway through which we can send information, about tax, investments and things like that, to clients,” Regan continued. One mark of the firm’s approach is its “Perfect Score™” ranking system of how well, or badly, clients and advisors are up to date with documentation, and how well the advisor/client relationship is maintained. That sort of scoring is a constant discipline and track of performance, Regan said.

A point to remember, however, is that all the snazziest tech in the world will be for naught if employees and clients don’t follow basic common sense in using sensitive information – such as not leaving passwords lying around on note on a desk, or not updating passwords regularly and sending bank details over via a private, unsecure email, he said.

Cybersecurity is certainly more than just technology.

The need for security around data and client information was underscored last week when a survey by Family Wealth Alliance showed that security, both of the cyber and old fashioned physical kind, is a high priority for family offices, private banks and others in the wealth space.

“It’s a constant battle to keep ahead of the bad guys,” Regan said.

This sort of offering is part of how Wescott, a firm currently holding over $2 billion of client assets, aims to secure the loyalty of clients and win more. It has grown organically and through acquisitions in recent years. Wescott Financial Advisory Group marks 30 years of existence this year. About 90 per cent of clients are high net worth and ultra-high net worth individuals, with the remainder being institutions.

Among its acquisitions was that of Goodstein & Associates in 2015. Wescott Financial Advisory Group has a footprint stretching down to Florida; its presence includes visiting offices in New York and San Francisco. And growth is necessary, Regan said, as economies of scale are important when cost pressures are ever present. “Ultimately, what we are talking about is scale – we are $2 billion of assets now but we’d like to be up there at $5 billion,” he said.

Projects in the skunkworks include evaluation of more technology ideas, such as around onboarding of clients and risk profiling, Regan said, when asked about future developments.

All of these ideas, says Regan, are meant to complement the firm’s Life-Minded Wealth™ approach which takes a client’s financial assets and financial mindset into consideration when developing wealth management strategies. This isn’t a firm that rests on any laurels.