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The Future of Advisor-Client Communications

Texting is the default communication method in 2023, but it is still a new frontier for financial advisors. The past few years have seen a transition from in-person meetings with financial advisors to video conferences through popular platforms like Zoom. The next big transition in communication between financial advisors and their clients will be a move from calls and emails to text messaging. According to Simple Texting, 70% of consumers opted in to receive texts from businesses in 2022, and 61% said that they want the ability to text the business back.

Text messaging is convenient and allows users to communicate in a brief, informal way that saves time. Rather than another email crowding your inbox or a phone call where both parties must be present at the same time, text messaging allows for on-demand communication at the user’s convenience. Everything from appointment confirmations to portfolio updates can be done via text, but how do you ensure the correspondence is safe and compliant?

Text messaging your clients comes with risks. In 2022, the SEC levied $1.1 billion in fines against financial firms because “firms’ employees routinely communicated about business matters using text messaging applications on their personal devices.” There are a number of steps you and your firm should take to comply with SEC and FINRA regulations. First, develop written policies and procedures around texting. Texting can take place on iMessage, WhatsApp, Telegram and Google Voice, just to name a few, so be sure to address all of the channels your employees are using. Once your policies are established, all employees must be trained and periodically updated.

Your firm can implement compliant client texting in a few ways. One way is to utilize a voice over Internet Protocol (VoIP) technology that easily integrates with compliant archiving software. Some compliance software, like Presults, offers a phone application that you can download from the app store and use to text just like you normally would. With this solution, you will need a new business phone number, but will be able to use your existing device to text with clients, so you won’t need a second device. 

Here are a few tips to keep in mind when texting:

  1. Always keep a security wall between your personal communications and your business communications. Having a separate phone number from your personal number protects your privacy in the event of an audit.
  2. Include standard disclosures at the start of any new text message conversation. If you are using texting to advertise to your clients, be sure to include the option for clients to opt out of these types of communications.
  3. Periodically test your security parameters, you should be using two-step authentication and encryption with all of your client communications.

The Takeaway:

Meet your clients where they are. Clients, and especially younger clients, expect that they can contact their financial advisor via text message. Texting opens your firm up to audit risks, so minimize that risk by having a policy in place, using the right tools to text message compliantly, and taking the effort to make sure your messages are being sent with robust security protocols.  To learn more visit,

Contributor – Larry Shumbres

Published on, May 3rd, 2023

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