wealth management software

1. A guide to wealth management technology costs: How to be a savvy buyer You know that you want to modernize your firm’s technology. But how much does wealth management technology cost? Knowledge is power: after reading this guide, you’ll be a smart buyer – and understand the true ‘all-in’ cost of advisor technology. 10 factors to consider beyond ‘standard pricing’ 10 factors to consider beyond ‘standard pricing’ By considering the following ten factors, you’ll make your next technology purchase with your eyes wide open: 1. Pricing models 1. Pricing models There are three basic pricing models across wealth management technology. No pricing model is intrinsically better or worse than the other – what matters is the all-in cost you are paying compared to the tech functionality and client services you will receive. These models are: Flat fee Per user fee Basis points on AUM

2. 2. One-time costs To get up-and-running, you may need to pay a one-time fee. For point solutions - it’s often free to get started. For platforms - you can expect to pay an initial implementation fee to cover startup and onboarding costs. For RIAs, this initial fee often range from $5,000 to $30,000, depending on your needs. For larger financial institutions with more complex requirements, one-time implementation fees have a very large range, from $50,000 to $1 million or even higher. 3. Add-on functionality Be careful about ‘nickel-and-dime’ charges. These costs can actually become bigger than your ‘corefunctionality’ costs. Unfortunately, it’s common for people to get hit with unexpected charges. Ironically, some low-cost providers end up being more expensive after add-on features than the premium providers. 4. Customer Service Some firms charge a higher price based on the access that you have to their client service support team. Make sure you ask questions about your software’s support model – everyone needs help sometimes, so you want to make sure you can get it. Especially if you have colleagues who are not particularly tech-savvy. 5. Training and consulting Consider working with a provider that offers on-boarding, training and consulting. Many FinTech providers claim to provide these services, but make sure to dig in before accepting these claims as facts. The providers that provide quality value-added services can become a true thought leadership partner to your firm. Remember: the ‘true cost’ of any technology includes the person-hours you spend internally. Most times, those costs dwarf the cost that you pay a third-party provider. Your firm type and personnel will determine how much training/consulting you need. You can expect to pay on an hourly-basis or project-basis. 6. Integrations and 'pass-through' costs As the wealth management industry has developed, many providers have decided to team up and integrate. Some of these integrations are free – others require additional costs. Before you finalize a contract with a vendor, make sure you are crystal clear on which third party services are free, versus those that cost money.

3. 7. Customization Some providers do not customize their software at all, while others provide a place for users to submit suggestions on new functionalities. Sometimes a process is in place for ‘statement of work’ requests, whereyou can pay to fund a special project that fits your firm’s needs. 8. Billing frequency Some FinTech providers bill annually, while other firms bill monthly. One tactic to use - ask if you can reduce the cost if you pay upfront. 9. Contract length Many FinTech providers price on an annual basis. Some price out multi-year contracts. Others use shorter contracts, where you can give a 30-day notice and stop paying. During the sales process, make sure to ask about price breaks if you sign a longer contract. 10. Timing It is a known fact that some technology companies pay their sales representatives based on monthly or quarterly sales. If you’re buying at the end of the month, sales reps may be more likely to give you a good deal. 11. Scaling Vendors give ‘enterprise pricing’ or ‘scale benefits’ – meaning that your cost per user becomes lower the larger your firm is. These scale benefits can be based on users or assets under management. When speaking with a sales rep, ask about how pricing scales as your firm grows. Module pricing Module pricing Cost varies significantly based on what functionality or ‘module’ that you are looking at. For example: basic CRMs that only provide ‘rolodex’ functionality are cheap; holistic CRMs that bring together your entire office are more expensive. The same holds for client portals, portfolio rebalancing software, performance reporting, etc. The main thing to consider in this category is your ‘all-in’ cost across all modules.

5. Platform pricing There are some major benefits going the full platform route, including data management, simplified vendor management and creating a unified experience for your clients and your

6. colleagues. It’s also common for platforms to give pricing breaks if you use most or all of one firm’s functionality to run your business. Advisor solutions Are you supporting tomorrow’s wealth management with yesterday’s technology? Technology may be the answer to accelerate your transformation with an advanced wealth management platform. Now that you are educated on the costs related to wealth management technologies, we are here to help. AdvisorEngine operates at the forefront of wealth management – reimagining how technology can serve financial advisors, make sure to schedule your demo today with one of our professional consultants. Alternatively, if you’d like an introduction to an industry leader such as Joel Bruckenstein we would gladly connect you, simply reach out. Bruckenstein publishes Technology Tools for Today (T3) and an expert on applied technology for financial professionals. Let us be a resource in the process of choosing a provider that offers first-class consulting and training - saving money and dwarfing your technology costs. We know what the TRUE COST of financial technology can be.