How Canadian Financial Advisors Can Stand Out in 2025

As the investment landscape changes, so do clients’ priorities and needs. To continue delivering value, financial advisors must understand how they can evolve their practice and meet investors’ expectations.

Morningstar’s 2025 Voice of the Advisor study offers actionable insights on the wide-ranging practices, perceptions, and challenges of financial advisors. Our Canada findings are based on 300 total responses collected through an online survey. Participants were represented across gender, age, career tenure, firm type, size of practice, and assets under management (AUM).

By conducting a competitive analysis and learning from peers, it can be easier for advisors to differentiate their practices and strengthen client relationships. Here’s what to know.

Every investor has unique wants and needs. Still, almost half of advisors (42%) believed they bring the most value in managing client investments followed by advising on strategies to reduce debt (34%), and making investors feel more secure about their financial future (32%).Our findings show that three of the top four ways advisors feel they add value to the client relationship are financially focused.

Along with continuing to focus on tangible outcomes, advisors should lean into the human side of advice by asking personalized questions and actively listening while demonstrating empathy.

A successful investment portfolio also looks different for every client. Even though advisors reported total portfolio growth (42%) and achieving specific financial goals (41%) as their clients’ top success measure, they believe clients are still concerned about environmental, social, and governance (ESG) impact. In fact, 27% indicated that success to their clients meant a portfolio that delivered a specific environment or social effect while 25% claimed it was one that aligned with personal values. ESG considerations even took priority over reducing tax liabilities (23%), suggesting that advisors need to not only define success with clients but offer investment strategies that align with what matters to them.

What can financial advisors do?

• Initiate conversations with personalized questions and empathy

• Deliver investment strategies that highlight investors’ values

• Align with clients on how to best measure success of their portfolio performance

Amid market uncertainty and shifts, advisors may be met with significant challenges. Of all the potential risks facing their practice, advisors are most concerned about market risk (39%). The top market concerns included economic slowdown/recession (33%), interest rate movement (32%), market volatility (31%), and inflation (30%). By staying informed on industry trends and news, advisors can navigate a changing landscape with confidence. Morningstar’s Direct Advisory Suite also offers tools and data for deeper portfolio analytics that can help mitigate volatility.

When it comes to communicating these risks and opportunities to investors, the number one approach was delivering personalized impact assessments showing the effect on a client’s portfolio, risk profile, and long-term goals (74%). Our risk profiling and scoring tools are designed to identify a client’s risk comfort, values, and goals—allowing advisors to build trust and offer tailored guidance.

What can financial advisors do?

• Stay up to date on industry trends and news

• Effectively communicate investment risks and opportunities

• Understand a client’s investment risk tolerance

Private markets can offer both new opportunities and obstacles for advisors. More than half of advisors (46%) are currently offering private investments with another 20% planning to offer them within the next year. For those who provide alternative investments to clients, the most often-used form is private equity (32%). If advisors participate in private and/or alternative investing, they must educate themselves on the true benefits and risks of these strategies before sharing recommendations with clients.

Despite the rising interest in private markets, regulatory and compliance are a top issue and key knowledge gap for advisors. According to our study, advisors indicated that their biggest challenges in conducting due diligence on investment products offering exposure to private markets were complexity of legal structures and offering documents (38%), regulatory uncertainty and compliance burden (37%), and lack of transparency into underlying holdings (37%). Unsurprisingly, the number one area advisors wanted to gain deeper understanding was around regulatory and compliance considerations (41%). To increase their knowledge and close the gap, advisors need to be informed on regulatory trends and compliance standards. Plus, they should work with clients to align on primary motivations for using this approach and set accurate expectations.

What can financial advisors do?

• Understand the benefits and risks of private investments

• Grow knowledge of regulatory trends and compliance standards

• Identify clients’ motivations for private and/or alternative investing to help set expectations

Using generative AI may be a powerful way to save time, reduce errors, and enhance client conversations. Our study finds that advisors may agree: 66% see the tool as somewhat of a help or a significant help while 17% are neutral about it. The remaining 17% of advisors view generative AI as somewhat of a or a significant threat with the top concern being people assuming they don’t need an advisor (32%). This indicates that advisors, whether currently adopting generative AI or not, may benefit from learning the true benefits and limitations of the tool.

Although generative AI is designed to support various tasks, the top ways advisors use it are for marketing and content creation (45%), research and due diligence (42%), and financial planning or modeling (41%). More than half of advisors (57%) reported seeing the most impact with improving efficiency in client communications and assisting with investment research and manager due diligence (53%). If improving time management is viewed as the largest benefit for advisors, tools like Mo—Morningstar’s AI chatbox—can help provide the insights and real-time data needed to work more effectively.

What can financial advisors do?

• Understand the benefits and limitations of generative AI

• Identify ways that generative AI can impact their practice

• Explore how AI tools like Morningstar’s Mo can streamline work processes

It’s no longer enough for advisors to simply provide a financial plan—instead, today’s investors are looking for tailored advice and support beyond financial results.

Morningstar’s 2025 Voice of the Investor study offers insights on the attitudes, behaviors, and preferences of investors. Our results uncover where investors’ values are shifting, how they define success, what they consider in long-term financial planning, and more.

Download the comprehensive report to incorporate tips into your practice and gain a competitive edge.