Justice for the Client with Justwealth October 24, 2017 RICCentre By Alison Ross, RIC Centre Communications Intern Think about your last appointment with a financial advisor. You probably had to schedule in advance, drive to the bank, wait (maybe you took some of your bank’s complimentary coffee) and then finally sit down with a financial adviser to hear limited options that were likely as good (if not better) for the bank as they were for you. Justwealth seeks to change that. Justwealth is a robo-advisor. Robo-advisors use algorithms to automate financial advice and portfolio management. By using technology, robo-advisers make portfolio management services that were previously expensive and only available to the affluent, widely available at low-cost. Andrew Kirkland, the President of Justwealth, is an experienced investment professional who spent a decade working at one of Canada’s largest independent asset managers in the areas of client servicing and business development. In this position, Andrew noticed that in-person financial advice is often inefficient. He also noticed that many firms were just as interested in making money off of their clients as they were in their clients making money off of their own investments. Andrew decided to set out on his own in order to do right for the Canadian investor. He says that “The ‘Just’ in Justwealth doesn’t mean we just do robo-advising, it means we believe in ‘Justice’ for the customer.” Justwealth is independent of any financial corporations. That means that they can be trusted to stay true to their philosophy of keeping the customers’ best interest in mind by choosing only the best products. In order to create Justwealth Andrew partnered with James Gauthier, the Company’s Chief Investment Officer. James is a 20-plus year veteran of investing with experience at a number of Canada’s top investment firms. James’ level of investment expertise is rare in a robo-advisor and it has allowed Justwealth to build the industry’s leading family of investment portfolios. Finally, the team also includes Richard Burton-Williams, Justwealth’s VP of Partnerships and Strategy. Richard is a former investment banker who, like Andrew, wanted to help the average Canadian instead of corporates. Justwealth was launched in January 2016 and it has grown quickly. The Company uses a simple 3-step process to sign clients up online, Step 1: Clients create an account by completing an investment questionnaire. The questionnaire asks clients what type of account they would like to open, their basic financial information, their investment goals (growth, income, wealth preservation etc.) and their risk tolerances. Here is where the “robo-advising” comes in. Based on the information gathered, Justwealth’s algorithm automatically chooses an optimal portfolio for the client. Step 2: Clients complete a personal information worksheet to provide Justwealth with additional personal information like banking details, home address etc. Step 3: Clients’ optimal portfolio selection is confirmed and their funds are invested. Once invested, Justwealth’s algorithm also automatically rebalances each client’s portfolio, ensuring that as time goes by, the portfolio remains optimally tailored to meet his or her financial goals. By relying on technology throughout the process, Justwealth is able to charge a fraction of what traditional financial planners charge. With other financial planners you can expect to be charged up to 2.5% on your assets, but Justwealth only charges 0.5%. OK, that all sounds good, but aside from low-price and technology, how else does Justwealth make themselves stand out from large players like the Big Banks, or other robo-advisors like WealthSimple and NestWealth. Difference #1: Justwealth has an Experienced Team. The Justwealth team is made up of people who spent decades in the financial services and investment industries. They know where the industry can improve, and they all want to do more to help customers grow their wealth. The focus on ‘Justice’ is not just a gimmick, it is the Company’s culture. Difference #2: Justwealth’s Target Market. Justwealth targets an age group that most financial advisors have not focused on. While most robo-advisers have generally targeted millennials, the average Justwealth client is in his or her late thirties to mid-forties. This demographic, early-millennials & Gen-Xers, has more money to invest (thus more to save by choosing a robo-advisor), and they’re tech-savvy, having worked, shopped and banked online for all of their adult lives. The average Justwealth client usually has around $70k invested with Justwealth, and has even more in household wealth. To be clear, Justwealth welcomes all investors and has many clients that are either young millennials or Baby-Boomers; however, they have had particular success with the early-millennials and Gen-Xers. Difference #3: Justwealth is Sophisticated. It’s not that they’re uptight and pretentious (quite the opposite, since they’re a company that puts the customer’s needs before profit), but they have a wide range of sophisticated portfolios tailored for individuals. While many robo-advisors try to fit all of their clients into one of only five or ten portfolios, the team at Justwealth has leveraged its deep investment experience to create over 60 portfolios in 5 families (Domestic Growth, Global Growth, Income, US$, RESP Target Date). While this may seem overwhelming it is not. Based on the customer’s answers to Justwealth’s initial questionnaire, Justwealth’s algorithm will automatically choose the optimal portfolio, doing all of the work for the client. That’s the efficiency of a robo-advisor. Given the array of Canadian investors and the many investment types available (RRSP, RESP, TFSA, RRIF, Non-Registered, etc.), Justwealth believes that more is better in order to find every customer a portfolio that’s the perfect fit for her or him. Indeed, with clients that range in age from 20 year-olds all the way to 90 year-olds, Justwealth believes that they can help any Canadian reach his or her investment goals. Check them out at www.justwealth.com.