TCA by E*TRADE announced Tuesday the launch of a new account aggregation tool, CompleteView.
Advisers who custody assets with TCA can use CompleteView to gather data across a client's accounts, even from other custodial accounts, to get a more complete view of their financial picture.
Wait a second, hold up. Haven't I written this before? Let's check the
InvestmentNews archives.
Ah, yes. Aggregation was central to Morgan Stanley's
new technology stack as a way to help advisers adopt comprehensive advice and goals-based planning (and
tap into a large market of held-away assets). The robo-advisers
all offer it, and the business-to-business ones like SigFig are introducing aggregation to advisers at
institutional firms like UBS.
I've written at least a dozen stories on aggregation in my first year at
InvestmentNews, and I'm hardly the first. Back in October, 2000, a young buck named Frederick P. Gabriel Jr.
called account aggregation "the hottest offering in online financial services" and reported that firms like Fidelity and Schwab had plans to launch services to help advisers attract wallet share. Mr. Gabriel
now runs our newsroom.
I guess my point is – in 2018 there are still firms that don't offer advisers technology to pull client accounts into a single location? TCA may be a bit late to the party.
A TCA by E*Trade spokesperson said the firm evaluated tools available at other custodians and wanted to be "thoughtful" in its approach to building something that's easier to use and addresses adviser pain points.
But the reality is that most custodians don't offer account aggregation capabilities because it's just not a feature in high demand from most advisers, said Doug Fritz, founder of consulting firm F2 Strategy.
Advisers who want to aggregate clients' held away accounts can do it through other software for financial planning, performance reporting and portfolio management. But even then, it's hard to get clients to buy in.
"Part of it is giving your bank or financial institution access to a bunch of your personal information," Mr. Fritz said. "Sharing your name and password to a website is still scary to some people."
And knowing about
unscrupulous advisers who have taken advantage of and stolen from clients, many investors may not want their adviser to see every dollar they own.
There's also the fact that a lot of aggregation technology just isn't that useful to advisers, Mr. Fritz said. They can see held-away accounts, sure, but the technology can't do much to help them do something with that information.
"Until someone can really show that client adoption is huge and advisers are significantly winning more wallet share from clients by doing this – it's a neat thing to have, but it's not the central, core function of what a lot of advisers do," Mr. Fritz added.
TCA by E*Trade believes offering aggregation a fully integrated, free-to-use addition to TCA's Liberty platform makes it more valuable to advisers. Data from checking and savings accounts and credit cards can be used in TCA's personal financial management apps to help track spending and progress towards goals, increasing client engagement.
"Unlike other tools in the market, CompleteView is embedded into TCA by E*TRADE's Liberty platform, and gives visibility to both the financial adviser and the end investor," the spokesperson said in an emailed statement. "Through this tool, advisers get an unparalleled view into their client's financial well-being, which enables them to deliver a more holistic solution—ultimately helping the adviser uncover additional opportunities to support their clients and grow their business."
Timothy Welsh, founder of Nexus Strategy, suggested that offering account aggregation could help advisers looking to introduce financial planning as a new service in their practice.
Traditionally, TCA held assets for advisers focused more on investment management and alternatives than goals-based planning, said Mr. Welsh. For those advisers, aggregation of held-away assets just isn't that necessary.
With changing economic conditions and regulations, more advisers are looking to change their business model to offer holistic wealth management and comprehensive financial advice. Still, it's a work in progress, he said.
"If [aggregation] was a panacea, everyone would use it," said Mr. Welsh. "But the concept is not fully baked yet for everyone."
