The financial industry is evolving rapidly, with new technologies helping advisors streamline operations and enhance client relationships. Investing in the right tools can give firms a competitive edge while also improving talent retention, as many advisors seek better technology. 

Essential tools include CRM software, which centralizes client interactions, financial planning software for scenario modeling, and risk analysis tools to assess investment strategies. Fi360 offers data and technology specific to advisors that can improve their efficiency. 

Additionally, scheduling software simplifies appointment management by automating bookings and reminders. Selecting the best options—such as Salesforce for CRM, Fi360 for financial planning, or Calendly for scheduling—can optimize efficiency.

 Finsum: With Fi360 advisors have the right technology and can focus more on delivering personalized financial strategies and strengthening client trust.

Managed accounts are set for a major transformation as current models often benefit providers more than participants due to high fees. Employers must evaluate how providers personalize portfolios and whether participants actively engage with these features. 

While managed accounts generally offer strong investment management, fee structures can erode some of their value, requiring significant equity exposure increases to match target date fund returns. Personalized portfolio returns tend to fall within a narrow 5% to 7% range, with minor impacts from strategic asset allocation shifts. 

A subscription-based model could better align incentives, offering lower-cost options for less engaged participants while providing premium services for those seeking greater customization. Inconsistencies in provider methodologies, driven by factors like risk tolerance and retirement readiness, highlight the need for greater transparency. 

Finsum: This is an interesting strategy, but if done properly managed accounts are a great vehicle for retirement and defined contribution. 

Target-date funds simplify retirement investing by automatically adjusting risk over time, making them ideal for those who prefer a hands-off approach. These funds, which held $3.5 trillion by the end of 2023, are often the default option in 401(k) plans, ensuring broad diversification and gradual risk reduction. 

However, high fees can significantly erode long-term returns, making it crucial for investors to choose low-cost options. While effective for wealth accumulation, target-date funds may not serve retirees as well since they lack built-in mechanisms for generating steady income. 

Some newer funds address this gap by incorporating annuities to provide predictable post-retirement income. It’s also important to note how they fit with the existing portfolio to create a coherent investment strategy. 

Finsum: As retirement needs vary, understanding fund structures and choosing the right strategy can greatly impact financial security.

Direct indexing has emerged as a compelling investment approach, offering personalized portfolios and tax advantages. According to experts at Goldman Sachs, this strategy is gaining traction as investors seek tailored solutions. 

The industry has expanded rapidly, with direct indexing assets now totaling nearly $800 billion—more than fivefold growth in recent years. Financial advisors are increasingly integrating direct indexing into portfolios to enhance tax efficiency and customization. 

Unlike ETFs, which track broad indices, direct indexing enables investors to own individual stocks, optimizing tax-loss harvesting opportunities. As adoption rises, technology plays a crucial role in managing the complexity of these highly customized accounts.

Finsum: The technology gains have made a huge impact in the world of finance but particularly with new strategies such as direct indexing where it can have a substantial impact on the cost structure. 

Now is an opportune moment to optimize your investments for tax efficiency, as upcoming policy changes could significantly impact financial planning. With tax rates set to rise and transfer tax exemptions shrinking in 2026, proactive strategies can help safeguard wealth. 

One key approach is ensuring that assets are held in tax-advantaged accounts, maximizing the benefits of tax deferral or exemption. Additionally, tax-loss harvesting and careful portfolio rebalancing can mitigate liabilities while maintaining investment goals. 

Charitable giving through donor-advised funds or qualified charitable distributions also presents tax-efficient opportunities. Finally, sophisticated tools like GRATs and strategic liquidity management can help navigate tax burdens while preserving long-term wealth.

Finsum: These are three wonderful tips to improve the efficiency of portfolios, and its good to start educating clients on the benefits of tax alpha.