The real threat [posed by robos] is to advisors who don't have a clear value proposition, who aren't very clear on who they serve and why they serve them," says Adam Cufr, RICP, founding principal at Fourth Dimension Financial Group, a wealth management firm in Perrysburg, Ohio.
Advisors who want a means to keep current clients from shifting assets to robo firms, or who want to make new inroads with the aforementioned types of clients, would be wise to consider offering robo-type online tools, Cufr asserts.
Robo firms like Betterment, along with incumbents like TD Ameritrade, Fidelity, and soon, Schwab, offer "white label" automated investment management tools such as auto-rebalancing and tax loss harvesting for RIAs and other kinds of advisors to use with their clients, Cufr notes.
Not only does that free them to focus on servicing existing higher-asset clients and prospecting for new ones, adds Cufr, "it gives the advisor an option where they might otherwise turn folks away.
You need to figure out where you add value that's commensurate to the fees you charge," explains Cufr.