Seven months ago, at its annual conference, LPL announced its intention to launch a robo-advisory service, starting with a pilot program. Now the firm's head of business development tells ThinkAdvisor that LPL expects to add the service this year.
"We anticipate rolling our own robo-advisor platform later in 2016," Bill Morrissey told ThinkAdvisor today in New York. "It's going to be different than what you've seen offered by other providers. We have no interest in having a B-to-C platform … going directly to investors. … It's simply a way for us to help augment what our advisors are already doing."
It's also a way for LPL advisors to work with smaller investors —"emerging savers and the next generation of current clients," including millennials, said Morrissey. "Anyone could qualify but typically an emerging saver has between $5,000 and $50,000 in assets."
Morrissey expects the robo-advisor product will be especially appropriate for millennials who tend to like a "front-end dashboard" that gives them access to their financial information. He couldn't say exactly when LPL, the largest independent broker-dealer in the U.S., will launch its robo-advisory product this year.
While many advisors are working to attract more younger clients, others are getting ready to retire because of their age – 43% are over age 55, according to Cerulli Associates – or at least join with another firm because of deteriorating margins and a complicated regulatory environment that is likely to get even tougher once the Department of Labor issues a finalized fiduciary rule, said Morrissey.
That "flight to quality" is helping LPL recruit advisors, said Morrissey, who oversees the firm's recruitment efforts. It's helping LPL attract a growing number of advisors who want to sell their firm but at the same time continue to work in the industry, he said.
