• Account Access
  • Contact Us

    Pre-Sales Support

    Mutual Funds and ETFs - 800-456-7526
    Monday-Thursday: 8:00 a.m. – 6:00 p.m. ET
    Friday: 8:00 a.m. – 5:00 p.m. ET

    ETF Trading Support - 415-315-6600
    Monday-Friday: 9:30 a.m. – 5:00 p.m. ET

    Post-Sales and Website Support
    Monday-Friday: 9:00 a.m. - 6:00 p.m. ET

  • Advisor Log In

Addressing the Three R’s of Advisor Anxiety: Robos, Revenue, and Regulation

June 2018 
by Ryan Sullivan

With the rapidly changing financial services landscape that these and other trends have caused, financial advisors may have some anxiety over how their practices will be impacted and what the future holds for the profession.

Besides concern for their clients, what else keeps financial advisors up at night? Chances are they're worrying about one or more of the three R’s: robos, revenue, and regulation. With the rapidly changing financial services landscape that these and other trends have caused, financial advisors may have some anxiety over how their practices will be impacted and what the future holds for the profession.

Fortunately, there is a way for advisors to deepen their value while also responding to the threats of the three R’s: provide more than investment advice alone. Rather than focusing solely on portfolio construction and risk mitigation, advisors can position themselves as a resource for personalized guidance and tailored education at any life stage—assisting in all aspects of life planning, goal setting, retirement, and aging. While many advisors already do some elements of this and quality investment planning remains essential, there may be an even greater opportunity to help clients and address the risks associated with the three R’s.



The algorithm-based advisory platforms known as robo-advisors made their debut in 2008 as a digital, lower-cost alternative to the conventional financial services model. In the ten years since, robo-advisors have impacted the industry by adding competition, increasing fee awareness, and raising expectations about how easy investing should be. Robos have also made it more difficult for advisors to differentiate themselves by investment strategy alone.

For their ever-increasing sophistication, there’s still one thing “pure” robos can’t offer: the human touch. Human financial advisors can ask about their clients’ goals, dreams, and dreads, then create a personalized financial plan to match. They can provide their clients objective expertise to weather market downturns, lend an ear during times of trouble, or hold a hand during a time of loss. Until artificial intelligence can go beyond algorithms and exhibit true empathy, financial advisors needn’t worry much. That an increasing number of previously robo-only investment shops have since added “live” advisors is only a testament to that fact.



Culminating from the rise of passive investing, ETFs, robo-advisors, and other factors, asset-weighted fees, in my opinion, are on the decline. This decrease—at a time of concurrent increases to advisors’ compliance and tech-related costs—has generally had a negative impact on advisors’ net revenue. Many now view fee compression as an industry fact of life.

To help address this, advisors must be able to articulate what they have to offer, beyond what the client can get through passive investing on their own. Discerning clients are often willing to pay more when they understand the value of what’s being offered—for example, a comprehensive financial plan, or expert help to implement, monitor, and adjust that plan as things change over time.



Although the Department of Labor’s Fiduciary Rule now appears defunct, other potential industry regulations loom on the horizon. For example, some states are considering creating their own best interest standards, which could make for a complex patchwork of regulations. Meanwhile, the Securities and Exchange Commission has released its proposed Regulation Best Interest rule. Regardless of whether any of these proposals ultimately go into effect, clients’ best interests will (and should) remain at the forefront.

The vast majority of advisors already have their clients’ best interests at heart. However, when and if it ever becomes necessary to prove that, those who have taken additional steps to help clients not just to invest, but to address the other concerns that come with life changes and aging, may have an advantage.

The challenges posed by the three R’s are here to stay. Providing prudent investment advice is still critical, but there is an opportunity to go further. For example, in preparing clients for retirement, advisors can offer not only traditional financial services, but also solutions to the many challenges aging clients will face. Advisors can ask clients where they’re going to live, how they’ll get around, and how they’ll maintain their critically important social network in retirement—sparking necessary conversations the client may not have considered.

In our work with MIT AgeLab, it’s been predicted that the financial professional of the future will need to be a “longevity solutions advisor,” helping clients to navigate additional topics like work, caregiving, and technology. Educating clients and connecting them to resources that can help will be essential, and can also help cement a different, but even more important, R: relationships.

Ryan Sullivan
Managing Director, Strategic Markets

Ryan Sullivan is a managing director of strategic markets for Hartford Funds. He travels extensively and is responsible for engaging and educating financial advisors and their clients about current and emerging opportunities in the financial services marketplace. These range from areas such as retirement-income planning, investment planning, and charitable giving, to anticipating and preparing for long-term demographic and lifestyle changes. Ryan has been an invited speaker on a variety of financial topics nationwide and has had the good fortune to address groups in 46 states and Puerto Rico.

Ryan originally joined the organization in 1996 and held various roles of increasing responsibility, leaving the company in 2012 as a vice president of advanced markets. Prior to rejoining Hartford Funds, he was vice president and head of investor education for PIEtechSM, the creator of MoneyGuidePro®, a leading financial-planning software program for financial advisors. Ryan holds his Life, Health, and Variable Products licenses and has earned the CERTIFIED FINANCIAL PLANNERTM (CFP®), CLU®, ChFC®, CRPC®, and CMFC® designations. He’s also a Fellow of LOMA’s® Life Management Institute.

Originally from Hartford, Connecticut, Ryan attended Bucknell University where he received a bachelor’s degree in business administration. He currently lives in Charlotte, North Carolina, with his wife, Katie.

The MIT AgeLab is not an affiliate or subsidiary of Hartford Funds.