How an Advisor Found More Client Engagement and Innovations

Anthony Ferraiolo: I'm a true student of the industry. So anytime Kitces releases a survey, the T3 survey, RightCapital had a lot of adoption there. If Kitces wrote about it, I would read anything that he writes. So anytime I see something coming from a subject matter expert on either the field of financial planning or the field of financial planning technology, it's something that I jump into right away.

As I was in my role in New York City, I was starting to look at new opportunities, and I found that there were a bunch of different tools that financial advisors were using. I reached out to a few people on the RightCapital team that are on the sales department and said, can I get a demo, or a 30-day trial or week trial of your software? Because I wanted to be more prepared for these interviews that I was going on at the time, but I also wanted to see what really would work for me. Because I have, just like an investment philosophy, a financial planning philosophy as well. So I want to make sure that the software I would be committing to, if I joined another firm, worked with what I believed financial planning should be: some cash flow, some goal-based, but not just going one direction versus another.

So that was my process, on top of reading the T3 surveys, which showed a newcomer having really high ratings and really high market capture at such an early stage. So that was my process — very analytical, testing things out, trying to break them, trying to create plans for people in my network using the software, and finding that it was a lot easier than some of the other tools I've used.

Anthony Ferraiolo: The Snapshot report seems to be something that just makes people's eyes light up. It's like, okay, we walked through the plan, we know what Monte Carlo is, now we understand our asset allocation. But just having it all in one place — I always joke, print this out and put it on your refrigerator. And the text box feature is really good for us to help keep track of open items that we need to follow up on, or things that we're planning to talk about in a next meeting.

So their responses have been really great, and I've found that there are a lot more people logging in using RightCapital than other software tools that I've used in the past. There are more people logging in and using the Vault and some of these other features, but the Snapshot report is really what's pulling people to log in and check things out.

The clients have had a positive experience with it too. I love using the tasks, and clients have told me that they love the tasks. They love that gratification of checking that box and getting that item completed. And it's helpful for me because RightCapital does these automated reminders. I make the tasks due for everybody, so I get the notification that it's due, the client gets the notification that it's due, and the spouse gets the notification that it's due. So we're all on the same page in knowing what's important.

Then if I get the email saying these tasks are due and I don't see them getting completed, I know what to follow up on, rather than having information in a CRM to follow up for it there, or via email. It's nice that it's housed in one location. Having the need to get a new statement for their 401K, or whatever it may be, listed out in the tasks is super helpful, and my younger clients seem to love checking those boxes off.

Anthony Ferraiolo: I just think it's so easy to use RightCapital to show three things that are really important for the clients that I serve, which is primarily tech folks with stock options and retirees.

The first one — and 2022 was a great example of it — is the stress testing tool. With very little effort, we can go into the tool and show them what the stress testing looks like and say, inflation's high, we account for that, and see how that impacts your plan. Or, the market's down, how does that impact your plan? Proactively sending them a report and writing up a little paragraph of what this really says, and if they want to jump on a call, I've had clients respond back, thank you so much, this was something we were thinking about but we didn't want to reach out to you because we thought it might be a little bit hectic. Which hurts me a little bit, because that's what I'm here for. But I try to be proactive in nature, and the stress testing tool really helps with that.

The other thing that I've had a lot of success with in client case studies is getting people to invest a little bit more cash. The tool does a really good job of being able to separate cash accounts and investment accounts and showing people that it's actually a little bit more risky to keep money in cash than to invest it in the markets, which may feel riskier than keeping money in cash. So as long as they have enough to meet their cash reserve goal, that's fine for me, and maybe even a little bit more. But really showing them the benefit, from a Monte Carlo perspective and a lifestyle perspective in the future, of how implementing some of that cash over time is really going to make a big impact on their retirement. And showing the correlation between having those cash balances and inflation increasing. That was a really top of mind topic the last two years.

Then the thing that I always do for clients that have equity compensation, and a lot of it, is figuring out what their financial number is. What I mean by that is RightCapital makes it really easy for me to show a net cash infusion. So if a client has 10 million of equity compensation in one stock from a recently IPO'd company, I could show them, if you were to sell a million dollars of that stock net of taxes and deposit that into a diversified portfolio, this is what it would look like for your financial situation. And showing how that corresponds to their financial success and their retirement, and what happens if that company stock goes to zero.

I had a recent case where they needed 2.5 million to secure a basic retirement at age 60. They have 10 million of the stock, and selling 2.5 million secured that normal retirement. Anything above that would help them achieve retirement sooner. And then after we sold the 2.5 million, of course the market took a hit, and we have to revisit and look at that plan, but they felt really secure knowing that their plan wasn't going to be completely derailed if they just held onto that additional amount.

A few different case studies, but those are things that excite me. As soon as I see somebody with equity compensation or a lot of cash, it's something that I love to show them, rather than preaching to them — just show them, this is the benefit and this is what would happen if you don't do that.