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Ep.10 Advice Engagement with Adam Holt, Asset Map

Using Visual Maps for Advice Support and Advisor Insight

Day Wachell
June 22, 2023

Adam Holt’s aha moment came when he was presenting his informal “asset map” drawing to a client back when he was a practicing financial advisor. The client immediately recognized the value of this encapsulated version of his financial life – and the idea for Adam’s company, Asset-Map, and his vision for greater advisor-client engagement was born. 

Client engagement is crucial in the financial advisory process – it’s precisely what differentiates the financial advisory relationship from automated, robo-advisor services that are increasingly available in the marketplace. When clients actively participate in and own their financial planning process and data, advisors get more insight and can deliver a more meaningful and engaging experience. Only by doing so can advisors establish a unique value proposition and maintain a client-centric approach that surpasses the capabilities of fully automated platforms.

Listen to the full conversation between Asset-Map’s Adam Holt and Responsive AI’s Day Wachell.

For more information about Adam Holt, you can find him on LinkedIn and Twitter.

For more information on Responsive AI’s solutions for advice providers, contact us.


Day: Welcome to this week's Advice Architects episode titled Using Visual Maps for Advice Support and Advisor Insight. This is Day from Responsive and today we are speaking with Adam Holt, CEO and founder at Asset-Map, co-host of Rethink the Financial Advisor podcast, international keynote speaker and recovering financial advisor. I absolutely love the way Adam is thinking about driving value into client advisor conversations, and I'm a huge fan of the features and Asset-Map. Welcome to the show, Adam.

Adam: Thank you, Day, for having me. It's a pleasure to spend time with you.

Day: Awesome. So at the top of the show we do a little Advice Architects questionnaire where we get to know you a little better. What's your job title and what do you actually do?

Adam: Oh, those two things are very different, aren't they? Well, I am the CEO and founder of Asset-Map. I think that's kind of an archival role that I've had over the past 15 years or so. I'm probably its biggest evangelist, right? I'm out there talking about it passionately, how it helped me in my practice grow to over $1 billion AUM firm and triple our revenue three years in a row and get to a place of just, I think, just real fun and exciting times, right, when your business is really growing and you're impacting lives. So, it's interesting to see how this whole best practice has now gone viral and gone global. And and I think today, I'm just really happy to be part of it. It's not about me anymore. I got 40 people and they're out there. They're beating the drums.

Day: Awesome. When were you happiest in your fintech wealthtech experiences?

Adam: Just now. Right now to be with you here. This is it. This is the moment. I very much believe in being present. So, I tend to think what's going on right now is what's my gratitude level. But I think, you know, it's interesting. As a financial advisor, you mentioned a recovering financial advisor. It's true, I'm still a CFP. I don't I don't see clients anymore. I sold my investment practice but still have an interest in the firm and I really just enjoyed being there for people and helping them make decisions. And that was the best part of it. Doing all the technical analysis was not fun for me, although I was reasonably okay at it. I found that delegating that was a much better use of my time helped me spend more of my time in my best flow state, if you will. Going to becoming a fintech CEO has been a definite learning experience. I'm sure you can relate to this having to take on many more skills than I ever needed before. Certainly, all entrepreneurial, but between management and finances and actually dealing with other people's money now it's been a really interesting learning experience.

Day: It's a steep learning curve. Why do you care about wealthtech?

Adam: You know, it's fun time. Sometimes I think you find yourself in a space. I don't I don't ever think that 20 years ago I thought that I'd be doing what I'm doing now. I was always, I think, inspired by other individuals who were helping people manage their money, money, just one of those ubiquitous things. Everybody deals with it at some level. I didn't really come from money, so I was kind of curious about it. I thought it was going to be an architect, actually at a college 28 years ago, and I wound up basically becoming a wealth architect, right? I was just designing people's futures with money and it was a cool outlet. I think today there's so many amazing opportunities to help people and it can be tied to money. So that's what I keep focusing on, is how do I just help people become more literate? How do I help them become more empowered? Those are fun words that typically didn't really get tossed around in the mutual fund world or the life insurance world years ago. It was like, can you just solve the problem? And it was a good compensation model. But I think today we're seeing a huge push towards let's go to the next level. Let's go up a level on the pyramid from just subsistence, subsistence living, but let's actually get people to have meaning associated with their money. And I think that it's not dorky anymore. Now, it's actually kind of cool to have, I think, meaning. And so, if we can help people do that collectively, both our companies, I think we actually serve the greater good.

Day: Absolutely. Well, wealth and health and life are all connected, and the more we understand that, the better we can live our lives. Right? True. So, we're hearing about advice engagement. What is advice engagement?

Adam: Well, I can tell you what I think it is. It's funny because I was having this conversation back and forth with Michael Kitses, I guess maybe a year ago, maybe it was less than that now. And I had said to him, I said, I think there's this new category out there and no one can name it. Everybody's putting a whole bunch of different names to this thing. I think it's advice engagement. It's the moment in time when a professional financial professional actually delivers the big value to their consumer, their client, and it's the confidence that they give them. And the question was, what is the technology that's being used that's helping scale the real value proposition that advisors are expected to be delivering, which is confidence in decisions. That really boil it all down. Can you help me make a more confident decision? I know there's no guarantees. There's no perfection. But I'll tell you, if I have to make this decision on my own without any financial literacy, I'm a little bit nervous. So that's when a human typically wants another human to get involved. And hopefully they bring confidence and experience and good analysis and a team hopefully that's going to be able to deliver. And once a customer feels confident, they are now empowered to make better decisions or a decision. Right. No decision or indecision is not going to help them get anywhere.

I think that really the big promise of a financial professional has been to help people get more confident around a decision and actually make the decision. In other words, save, ensure budget legally, protect, focus on taxes. Right? These things are levers that would tend to dominate the conversation. Right. How's my performance on my mutual fund? Now it's more important to actually buy something than to worry about whether it's the perfect fund. And I think that's I think people are realizing that. But I say that all to you today because. Very little tech has been out there or created for the professional other than practice management software. Okay. CRM. Great portfolio management. Awesome. File storage. Yep. Docusign. Compliance. Okay. So, tech has really created a lot of efficiency on the back office that people are now integrating, but nothing's been really available other than financial planning tools, which we know right now only 20% to 30% of clients are ever getting a financial plan, which means what happens for the other 70%? They get a statement in a call every once in a while. Maybe if they're lucky. We needed a way to find a way to scale out the advisor's best value proposition, which is putting their intellect, their advisor's intelligence into their client's world in real time. And that's what tech is supposed to do in the advice engagement space.

Day: Very, very cool. Okay, So tell me about your flagship feature. The asset map and asset map and how it generates value for advisors and clients.

Adam: Well, it's funny because in the beginning it wasn't about the client. This was about helping the advisor understand what was going on in a client's life. There's a lot of complexity, especially when you get to the place where a household is finally capitulated and said, okay, I want advice. You know what's happened there. They've gotten to a place of complexity for which they want confidence that they're making good decisions holistically. Right. It's not just about should I buy a fund? Should I put money in the IRA? That's professional advice tends to be, you know, I've got a business, I've got a bunch of real estate. My dad's going to give me some assets. I'm making good money. Should I use the stock options? There's really complex decisions. I think that that really. Promote talking to a professional. And for us in our wealth management practice, it started to get really complicated. So, we created Asset-Map as a way to understand what was going on in people's lives. Right? A lot of people use, and I joked recently, a yellow pad or a whiteboard or a screen to try to kind of draw out what we understand to be going on in these people's lives. We use balance sheets and policy summaries and income statements and very technical stuff, which takes a while to create and tends to create the package of how we define a client. We used to call it KYC or know your client or fact-finding. A critical part of all advice delivery is you've got to know the client, right? So, the key for us was could we actually get this to a place where we could just look at this diagram and we know what's going on with the client's lives? All the people that are involved, all the entities they control, their kids, generation up, down, all the people that matter, all their financial junk, not just your assets that I can manage, but the liabilities, the split interest in a private equity deal I did with my brother the real estate that Nana left us that's really owned in a trust, the income that I'm getting from my work, but then also the income I'm getting from, I don't know, a rental real estate or some other complexity or an annuity agreement.

There's a lot of diversity and complexity in most households. It turns out you appreciate this. On the data side, the average household in the States has about 25 different financial instruments. Examples. Oh, yes. An IRA. Okay. A bank account, a credit card or three? A house. A mortgage. Their salary. Social Security, their insurances from all their employment. So, life insurance, medical disability, then you add up all the stuff they were sold over the years. Then you had the annuity that somebody sold them. And. Right. It's a lot of stuff. And your financial closets usually a mess. So the key to the Asset-Map is for the advisors for us to just say, okay, I understand it and I can actually put it into a frame that I can now use it as a communication tool.

The interesting thing about it, and ironically, I literally just talked to the clients that first kicked this off 30 minutes ago. I went to their house as an adviser and I was there with my massive retirement reports, my Morningstar, all that stuff. And he saw me drawing on this thing and he said, “What is that?” I said, “This is a thing I use for myself. It's called I call it an asset map. It's got all your stuff on it. He says he takes it from me.” He says, “Do me a favor. Don't bring all that other junk anymore. Okay. Next meeting. I don't want any of that stuff. Okay? Nobody can read it. And that's your stuff. That's like bringing all your kitchen utensils to serve dinner. Like, I just want the dinner. I'm going to take this home, okay? I'm going to give it to my wife now. She's going to finally understand what's going on. Okay? Because I can't explain this to her.” And that's when we had an aha moment. We were like, oh, we should make this for them. And that's when it blew up and that's when we had this experience. So in a sense, if you already probably figured out if you're listening, the asset map is a visualization of all your financial household’s decisions and the people that matter: insurance, incomes, assets, liabilities and members or entities all on one page or screen. And that's been the real key to our success, I think, globally.

Day: Thank you for walking us through. Next up, the target map and maybe you can talk about the value that creates and then how we can think of it in relation to the conversation around the asset map.

Adam: Well, target map is our way and I don't love the naming of it. And even though it's been part of our repertoire of brands for so long, the target map was to say very much like a GPS, Day. You know, once you know where everything is and you think about it like Google Maps today, most people understand that, right? You use it to kind of see where you are in relation to other things, right? Whether it's the restaurant you go to or you're traveling to your friend's house or maybe the nearest bar. I don't know where you're going. Um, you tend to need that contextually to understand the relationship of things. So that's the same thing. That's true with assets. But you also need to know because you're probably going to go there whether you're on track to get there. So we needed to build something that was financial planning inspired. But its output was one page. Okay. Just like the GPS on your car screen, if you're using it on your phone, you need to have these things running actually in tandem. I need a map of knowing where I am at any one time point in time. And I also need to know whether I'm on track for major goals. What are those goals? Well, typically retirement planning. Am I going to have enough capital to fund that? How about education funding? What about loss of life scenarios? God forbid I don't make it. Does my family have enough capital, disability, long term care, wedding, whatever? Anything you can think of. We can take it as math behind it. In 30 seconds I can make a progress chart and perfectly validated of whether you're on track for your major goals.

How is this used? The key is to take what we've done in financial planning and compress it. If I can compress instead of a two-day exercise with 800 pages and four hours of thought to something that took me literally 30 seconds and one page output, all of a sudden I've now gone into this place of like tear sheet value. It doesn't have to be one page. It's just each idea needs to live on its own page so we can discuss it or on a screen. What are we going to do about retirement funding? Are we on track? We're 77% funded. Looks like you've got to save $2,500 bucks a month and I need to figure out a way to get your overall rate of return to 5% net of fees. How the heck are we going to do that? Let's now spend our time talking about that versus look at line 42 of page 83. Do you see how you run out of money here? But what happens if this. Oh, I didn't run that analysis. I'll come back to you next week. The key was to make it actually interactive so that an advisor could do this, live with the client. And they own the numbers. So a target map is, as you've already brought up, is a way to quickly visualize and communicate the core things that need to happen in order for you to get what you want, which is to be fully funded. Okay. And I don't want to tell you when you're going to run out of money. You don't care about that. You want to know what it's going to take to win. Okay, here's what it's going to take to win.

Day: Awesome. So there's a lot of data and information hanging out underneath these awesome features. What do you guys have connected right now as far as linking in, you know, those instruments you were discussing earlier?

Adam: You know what's really funny when most people see the asset map? Their first response is, Oh my gosh, you got to pull an enormous amount of data from systems. And the answer to that is, yeah, that is true. Show me where that data is. Right. I just told you that there's 25 points of data just on the finance side on average for a household. And then you've got two, three, four people. Where's all that data? Do you think it's in the CRM? Do you think aggregation covers it? It doesn't. Aggregation covers about seven of those 25. So we've done as a society a reasonable job of getting closer to data transparency for our clients finances. But it's so far to go. And so that means that I've got to get the data from the customer. The key. I still have to ask the customer, Do you have an IRA? Do you have a private equity deal? Do you have. What's your house worth? Right. Because they haven't even aggregated. Usually when you're talking to a financial advisor, they're like, I don't know. I don't know what to do. Like, tell me what to do. I'll do it or you do it for me. That's why I'm paying you. So in the sense of collection of data, it's the first big challenge with data.

And I'll tell you the second piece, which I think you guys do really well. Collecting the data is often in the client's head. Okay, so we created a discovery tool. It's a direct-to-consumer thing. I can send you a link on a QR code and you can fill it out in 15 minutes on your phone. And I'm going to get in response an asset map, which is what I need as your advisor to see where the heck the stuff is. Okay, I'll give you that when it's done. And I've actually played with it and updated it and corrected it because most people don't know what they really have. And that's an important process of engaging with them around their own data. Let's go through the closet together. We're going to dump it on the bed and we're going to put it all together in an organized way. So now I can know what I'm working with here. All right. That makes sense. That's an important cathartic process, actually, an asset map that very other tools don't have. And we can't diminish that because that's often where we build a lot of relationship value with. The client is collecting their data understanding and giving it back to them immediately, as opposed to hiding behind a screen and saying, I'm collecting your data like type, type, type, type, type…

What was he typing? I don't know. He's typing. So the key is to give it back to them immediately, visually. So, here's your data and here's where it goes, okay. And you're learning through that process. Back out now. What kind of data do we have? Well, as you could already figure out, we have. Data on the people in the household. We know their location. We know some interesting demographics. We know what their net worth is. We know what their insurance is. Ah, we know actually where all their dollars are in those four instruments, as I mentioned, debts, etcetera. We can start making some really interesting insights. In fact, we've catalogued over 1.25 million people right now in Asset-Map. It's one and one half trillion dollars of financial instruments of what we call buried treasure that is represented in these households. And we can start to see some really interesting things. The first of which is our foray into machine learning that says, by the way, most people are underinsured, underbanked can't really fund their retirement. And so there's an enormous amount of opportunity that's indicated. And it really begs the question of can we get to the next level of next best action?

Day: And so when you're thinking about that, like what are some of the wilder ideas or valuable ideas you could see being implemented? And in terms of what's surfacing to the advisor and the client?

Adam: That's a great question. One of the things that we've been playing with, it's our first foray into algorithmic, not AI, but algorithmic insight is something we call signals. We just want two words for it. But what it does is it helps. It looks at the asset map and says, By the way, you can't handle this event. You would be a red, yellow, or green light. What is an event? I mean, we call them the financial fire drills. These are the six events that will just totally knock out all our good planning. Okay. For example, you know, the roof blows off. You don't have enough cash to cover it. So do you have enough emergency reserves? We can calculate what that is. Basically, what happens if, God forbid, you were disabled yesterday? Could you handle it? Red light, you're going to lose the house. Okay. So it allows the advisor to say, hey, we should have a conversation because this this link bringing light here is saying you don't have enough tire pressure in your car. You should pull over. Okay. Before this becomes a wreck. And we think advisors really need this because we find even though we tend to trust a lot of our advisors, just like a doctor. Can you imagine if the MRI machine literally said, Hey, by the way, look over here, look over here, right, flashing light? Because as humans we tend to miss things or we tend to talk about the things we know the most.

Adam: A lot of advisors do not talk about the calamity planning. They talk about let me invest your money. Let me show you why asset allocation is important. Look at my great tax management strategy, my direct indexing. That's what they love to do. That's what they do. That's what they charge. They don't like talking about life insurance or disability scenarios or estate planning, why they just don't like it or it's a bad word. I don't know. They don't like insurance. So they don't bring it up. It's like literally talking, I'm going to sell you this Ferrari. It's totally tuned up. It's beautiful. It's gorgeous. Look at the paint job. It's fantastic. And you get into the car, you're about to drive away and the client says, Where are the seat belts? Oh, I don't do seat belts. Seat belts. That's the other guy. Okay. But somehow I'm still a holistic financial advisor and I don't like talking about calamity. So the interesting thing we've seen today in the first foray, I'm really curious what you think about this is just informing an advisor. There's something to look at. Just look over here. Is this right? Does this make sense? I'm curious. What do you think?

Day: I mean, this is the reason our business exists, right? It's what's the most important thing you want to prioritize? What client, what conversation, what's coming to the surface? We want to take action now. And the sort of thing I've been going around and saying lately is, you know, everybody's talking about doing more with AI. Maybe we should be using AI to do less, right? Like to just just focus on the one thing that's going to make an impact. Yeah.

Adam: What do you think we should focus on? I mean, that would be interesting. You know how much data we have. What do you think advisors or the community, even professionals, could be tax professionals could be legal professionals. What do you think that they're not talking about?

Day: I mean, I think it's tied. I mean, there's so many topics across different channels that we can look at. I think the most important thing is, you know, are you always discovering and what's going to initiate a discovery and what, you know, what's downstream from a discovery like. You know, we have a partner called tax status. And, you know, through them we can look at is someone still paying tuition for their kid? And once that kid is not paying tuition anymore, it's like that's like a, you know, a little piece of data on a form somewhere buried in the bottom. But it actually is really meaningful to someone's life. It's where they take stock, reconsider, you know, am I going to downsize my home? You know, what's the next chapter about? So I think finding those little things and then and then initiating conversations that are super meaningful, that's what's kind of exciting to me when you think about in the context of the asset map, which is generating all these meanings and the target map which is generating all this meaning. Yeah, yeah, yeah.

Adam: It's interesting because one of the things we tried to really do is stay agnostic to a couple of things. One was agnostic to currency and gender and family makeup and language. So we are actually covering 130 some currencies right now. And yeah, and yet what we decided to do is we also stayed agnostic to. We'll call judgment. In other words, we stayed away for a long time from telling you what the asset map meant. In fact, it was really intended to be like, this is just the picture. It's not good or bad. It's the facts, right? And we would allow the adviser to apply their insight in real time what we call advisor intelligence. Some of those are more intelligent than others, and some see those challenges or opportunities differently. For example, an investment advisor will see a lot of the investment opportunities, the insurance advisor. You can imagine what they see opportunity to sell insurance and of course the tax professionals are seeing something completely different. And so one of the things that we're really interested in doing is how do you help start to create a feedback loop? About best practices of what the asset map starts to tell you. It's one thing to show you a picture, but it's really nice sometimes to go to the museum and say like, well, this is what the artist was thinking. Right. Is there interpretive or their interpretations that we can start to that we can start to layer to get to what's in my best interest? Because we very seldom think that it's one perspective that's going to have all the answers. It really is going to require a community of professionals. One of the things we're focusing on a lot now is how do I create a collaborative environment to get more of those eyes in addition to potentially next best action or eye on top of that to facilitate the right conversation because nobody has any time left. And the key is can I get an intentional conversation going around what's in your best interest right now with what we know and then hopefully make some decisions.

Day: So how do you conceive of that kind of existing in the current view? Is it like someone might have a specific practice template and that's kind of like an overlay of how you might look at things or.

Adam: That's funny you mention that. We actually do have an overlay platform called stencils, which allows you to overlay what your peers have that you may not have. A business owner also has this. Do you have that you forgot to tell me or this is where it fits almost. It's a great facilitation of conversation, but when it comes to actually giving you feedback, which is where I think you're going, we don't have more feedback than the signals and the target maps, which are intentional. The target maps are intentional. Executions of I know what you also want because you've told me and I'm going to tell you whether you can afford to fund it based upon this information. I think the next phase is going to be and we don't have it yet is going to be what we're discussing. Which is what? Here's five things you need to focus on now based upon your unique and personalized fact pattern.

Day: Definitely. Okay. So then we do a sort of deep question and it can sound really silly, but it takes a second for it. But why does client engagement matter?

Adam: Someone said this just yesterday. They said, what is client engagement? And or rather, they said, what is financial advice without client engagement? And my gut response is it's robo-advice. It’s robo-advice. Client engagement is the whole point of having a human involved with your advice. It's, notice the word engagement. I know some people have a connotation with that word, but what it really is, is we're working together. Can you imagine if I came to your house and said, “Here, dude, I bought you this Lego toy, this awesome set.” You're like, Oh, cool, we're going to work on it together. I'm a Lego expert. Oh, by the way, I built it last night before I came over, so I just brought it over completely fixed. Now let's play with it like you would be. Like what? I've. I've lost the opportunity to include you in the process. If I build it for you and then tell you, Here's the thing. Now go play with it versus if we build it together. And I think that's the future of financial engagement is getting people involved. Now, we might not have equal roles here because clearly I'm the expert if I'm a professional coming in. But you have me. My goal is also to educate you, let you feel like you're part of this, because when I'm out of the picture, because I retired or sold my business, this is still yours to play with and you got to be empowered to play with it. And now teach someone else or you know what I'm saying? And I think that's the big, big problem. That's I'm glad you asked the question because I know you didn't know this answer was coming. But here's the big problem long term. 

Right now, it can't be engaging. And the reason is because the wrong people own the data. All right. Long term, a consumer cannot be engaged and empowered around their own financial life if they don't own the process and they don't own the data. And the thing what I have seen all too often is a client works with a financial advisor. They get a financial plan, great big book, blah, blah, blah, blah, blah, blah. The advisor moves on or the client says it's not the right fit and they leave the plan behind. So it's like jettisoning your like, whole life plan and saying, okay, I'm going to start over and redo it again. It's really actually destructive. And that means you also can't pass it to the next generation. I think we're moving towards a space where we can really democratize this process. And once the client actually owns it and is part of it, they're going to have to set much higher expectations of the financial professional advice they get. And that's where engagement is going to be huge because if you can't engage with your client you're replaceable by the next chat bot, right? GPT-10 or whatever the next thing is. Or robo-advice 4.0. You’ve got to create a value proposition. And it's really going to be incumbent upon financial professionals to really deliver an engagement experience so that they think of you before they think of Google. Okay. That's the key, right? This person really knows me and they've engaged me and I like the process. I trust them. They've brought me through it. And it's not just been a presentation mode, it's been a participation mode. And that's really, I think, where we're going as an industry.

Day: I really like that. It's almost spatial. It's like the advice and the plan should be in the space between the advisor and the client, not behind occluded by the advisor and the data as well. It should live between them. Yeah.

Adam: It should be accessible. It shouldn't be. This is my data and my client can get it when I feel like giving it to them. If I have time this month. Let me look at my Calendly. Let me see if I know. Right. It needs to be empowering and that means you need to have ownership.

Day: Agree to agree. Thanks so much, Adam. This is a great conversation. I really loved having you on the show.

Adam: Thanks, Day. Wish you all the best.

Day Wachell

Day studied AI in the SymSys program at Stanford and Film at Columbia. Their innovative thinking drives the company's success by bridging technology and the arts, leading to a culture of creativity and out-of-the-box thinking.