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imageI came across an interesting article in this month’s Financial Advisor, “Shakeout Ahead” written by Andrew Gluck, a veteran financial writer and owner of Advisor Products, Inc. a marketing technology company servicing 1,800 advisory firms.

The gist of the article was centered on the debate as to why there has been a decline in the number of financial advisors over the last decade, and as to whether online wealth management applications which have grown in number and sophistication would soon replace the FA and allow consumers to “do it all themselves.”

Gluck goes on to say that there is an “intellectual and academic assault on the value added by financial advisors” taking shape. He even goes further to say that “what Expedia and Kayak did for travel reservations, we can do with financial advice.”

I share with you the response of an unidentified blogger after having read this article; I happen to agree with him:

“I’m sick of the elite finance guys thinking they know what the public wants and needs from a financial advisor. They are often well-financed in their ideas, have a pretty cover, as they sneer with disapproval at pedestrian financial planners. But as long as they actually believe that people want investment mean variance optimization instead of financial advice, they’ll fail.

There truly is a shift to bringing financial advice to the people who need it. But, Financial Engines with good GUI for Geeks isn’t going to do it for most American families. As long as our profession keeps its collective heads in academic finance, MVO will be part of the solution, but only a small part. Technology and the evolution of consumer web behavior is re-defining financial advice, but the need for an understanding, trusted advisor is still paramount. These guys want to give the financial equivalent of a pill dispensing machine to replace a doctor/nurse.

Fill out your “symptoms” and we will dispense what you need. You’ll like it better because it is smarter and more efficient. Bunk.”