Products shaping the future of wealth management

Wealth management has undergone a significant shift over the past decades. Technologies and techniques once exclusively accessible to high-net-worth (HNW) and ultra-high-net-worth (UHNW) individuals are now accessible to investors and consumers with smaller incomes—helping build wealth and savings in the face of major economic headwinds.

A range of products have helped democratize access to this crucial sector, and have upended how incumbents have had to do business, too.

Robo-advisors

The automation and technologization of advisory services have helped fintechs offer wealth management solutions to millions of clients. Platforms like Betterment and Wealthfront, in partnership with major fintechs and banks like Green Dot and UBS, have scaled to manage more than $60B in assets combined.

Granted, this is far smaller than the $4T that UBS alone handles—but it may be a harbinger for how more people, even if fewer dollars, interact with the wealth management sector in the coming years.

Private credit

Wealth management for the wealthiest families and investors involves access to investment vehicles that are unavailable to most. Institutional investors can leverage private markets, which can offer outsized returns on investment, while retail investors are generally forced to rely on public markets.

But fintechs like Percent and Yieldstreet have offered a pathway for access to private markets and alternative investments. The status of alternative-investment platforms is still in flux, as the SEC’s recent charge against Yieldstreet reveals, suggesting that incumbents’ handle on private markets remains strong.

Cloud computing

Finally, while cloud computing may not seem like a technology whose impact has already come, incumbents continue to rely upon outdated systems that complicate scaling their services. In the meantime, the relative affordability of cloud computing lets challengers establish their products more rapidly than their mainframe-dependent counterparts, setting up markets and scaling quickly.