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The Advisor's Answer to Popular Personal Finance Management Tools

Consumers love their high-tech PFM apps, but this software platform can help you close the technology gap.

Bill Winterberg, 07/11/2013

Personal financial management applications, or PFM, have exploded since Intuit INTU, the creator of desktop-based Quicken personal finance software, acquired online competitor Mint.com in September 2009 for $170 million. Mint.com now boasts over 10 million users of its online website and mobile apps for iOS and Android.

PFM competitors including Personal Capital, LearnVest, Wave, and more have appeared over the last several years, giving consumers the ability to aggregate banking, credit, loan, and investment accounts and view them with modern, user-friendly websites and mobile apps.

Although PFM tools are helpful for tracking spending and budgeting, consumers may realize that they might benefit from a personal relationship with a professional financial advisor for more complicated needs.

Many advisors use portfolio management software solutions to deliver account information and performance reports to clients, often through the use of an online client portal, but these tools lack the aggregation of client banking and credit accounts present in PFM apps, and many of the interfaces are not designed with mobile phone access in mind. Also, clients who continue to use PFM apps will receive automated product suggestions that may conflict with the financial objectives outlined by their advisors.

One solution for clients to consolidate their portfolio and personal finance information comes from Conshohocken, Pa.-based eMoney Advisor, LLC. For over a decade, the firm has been providing a suite of programs specifically for financial advisors that rival their PFM counterparts, while reinforcing the service relationship between clients and advisors.

eMoney Advisor
Founded in 2000 by former financial advisor Edmond J. Walters, eMoney Advisor provides Web-based wealth management and needs analysis software to financial advisors. The primary product is eMoney 360, which is offered in a standard and Pro version and is used by more than 25,000 advisors, planners, and assistants. eMoney also offers Advisor Marketing, a collection of videos, presentations, and marketing resources financial advisors can use to attract prospects and market their business.

eMoney 360's most impressive feature is its portfolio of data connections to financial institutions. According to eMoney director of business development Kyle Wharton, over $600 billion in assets are aggregated by eMoney Advisor, with 90% of those data connections developed internally. For the remaining financial institution connections, eMoney combines account aggregation functionality from Fiserv's FISV CashEdge and ByAllAccounts.

The extensive data connections allow both advisors and clients to view a complete accounting of financial, insurance, real estate, and other holdings that is updated nightly. Assets as well as liabilities (remember that eMoney retrieves credit card transactions) can be viewed on both a consolidated and an individual account basis, cash flow trends are displayed in the spending screen, and more than 200 report types are available to review with respect to investment assets.

Advisors who wish to use the aggregated account data to generate financial plans or illustrate estate planning strategies will want to upgrade to eMoney 360 Pro. Available modules in eMoney 360 Pro include the Advanced Planning Center for illustrating financial plans that include stock options and estate planning strategies; Investment Planning to create investment proposals and policy statements; an Organization Manager to oversee the financials, key executives, and board member information of an organization; and Retirement Income to illustrate retirement income projections for clients nearing retirement.

Total Office Potential
The eMoney Advisor products are a class of all-in-one "total office" solutions comparable to Junxure, Envestnet|Tamarac, Interactive Advisory Software, and Morningstar Office (editor's note: the author is a freelance contributor and not an employee of Morningstar). Users of eMoney 360 Pro have access to a lightweight contact manager, portfolio management tools, financial planning and needs analysis reports, and a lightweight document storage system.

Client names and basic contact information are easily stored in eMoney, but the features here fall short of what I would consider a true CRM. While eMoney has the ability to set and manage alerts for clients, advisors will not find genuine workflow support for sequential processes carried out through the normal course of business.

On the portfolio management side, eMoney contains a variety of standard reports advisors should find useful. Available reports include asset allocation charts, efficient frontier analysis, Monte Carlo simulations, and more. The portfolio reports are useful when working with common assets such as stocks, bonds, mutual funds, and ETFs, but advisors may find it challenging to deal with alternative assets, closely held business interests, or collectibles and hard assets. However, that challenge isn't exclusive to eMoney, as such assets will require manual maintenance in just about any total office software product.

eMoney 360 Pro is capable of generating very comprehensive financial plans for clients, often encompassing 100 pages or more. Planning illustrations are dominated by cash flow projections, so the system relies heavily on the accuracy of income and expense information provided for every year of the financial plan. Because there are so many options to the planning analysis, eMoney provides online video instructions to help guide advisors through the various features and capabilities of the software.

Finally, eMoney includes a basic document storage service called the Vault intended for use with client documents like tax returns, financial plans, performance reports, and even photos. Since it is intended for client materials, the Vault is not a robust electronic content management system, so I would not expect advisors to use the Vault as the exclusive repository for compliance records, business financials, and other information unrelated to client service.

Client Access
While the list of features in eMoney is extensive, it's important to remember how this column originally started. Many clients today are using free apps and software targeted directly to consumers to aggregate their bank, credit card, loan, and investment accounts without the help of a financial advisor. These apps work very well and are simple to use, so it's foolish to believe clients and prospects will simply stop using them once they begin a formal engagement with their financial advisor.

As an alternative, eMoney allows advisors to provide clients many of the capabilities found in the free personal financial management apps, but do it in a way that emphasizes the advisor's personal advice and services. Each client can access their own online client portal to view much of the same account and asset information available to advisors.

The eMoney client portal is built using HTML5 and responsive design techniques, meaning that the user interface adapts to the screen size of the mobile device being used. While there are no native apps for iOS, Android, Windows, or Blackberry mobile devices, any device can access the full functionality of the eMoney client portal simply by using the device's Web browser.

Digital Mail
A recent addition to the eMoney client portal is an integration with Digital Postal Mail from Zumbox. The integration allows clients to connect the electronic document delivery from their online accounts with their eMoney client portal.

That may not sound revolutionary at first, but if most clients are like me, they have a dozen or so separate online accounts that push electronic document delivery, typically once a month. It can be a hassle to skip around financial websites tracking down statements and reports. Instead, clients can take advantage of the Zumbox integration to consolidate all of their electronic documents into one place.

As with any aggregation or consolidation service, reaching critical mass of data connections is crucial to user adoption. Fortunately, Zumbox connects with more than 100 providers, including popular financial institutions like Bank of America BAC, Charles Schwab SCHW, Scottrade, and TD Ameritrade TD, and it also connects with a growing number of utility service providers such as Comcast CMCSA and Verizon Wireless.

Despite the variety of modules and features available under the eMoney Advisor suite, pricing is simple and straightforward. Retail pricing for eMoney 360 is $2,400 per year for each user license, and eMoney 360 Pro costs $3,600 annually per user. Discounts are available through a variety of partnerships with institutional custodians and broker-dealers as well as for bulk license purchases, so advisors should first check for any applicable incentives prior to contacting eMoney directly.

Tens of millions of consumers are using free PFM apps to view and manage their personal financial situation. It's unrealistic for advisors to think that a potential client will stop using these apps once they become a formal client. Advisors need to offer technology that delivers the same convenience and utility without referring clients to unknown third-party product providers. Instead, advisors can use the eMoney platform to deliver account aggregation, mobile device access, and wide-ranging planning advice to clients to close the technology gap with PFM apps.

Bill Winterberg, CFP, is a technology and operations consultant to independent financial advisors. His comments on technology have been featured in a variety of financial industry publications. You can view more information about Bill and see his schedule of upcoming speaking engagements at his Web site, FPPad.com. The author is a freelance contributor to MorningstarAdvisor.com. The views expressed in this article may or may not reflect the views of Morningstar.

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