Professional financial planning may have started with the life insurance industry, but it isn't staying there. What began as a more organized approach to selling insurance products has evolved in just a few decades into a robust and highly competitive marketplace in which banks, insurance firms, independent wealth management firms, accounting firms, and law firms expand their sales and management programs. Certainly, accountants and insurance agents are still the core of the financial planning industry. Accountants carry the lead among small businesses and their owners, while insurance agents remain the primary financial advisors for individual consumers. But these two groups face challenges as never before from investment groups and trust departments of banking institutions, particularly those that are developing hybrid investment/insurance securities products.

Driving this competition are three trends.

1.The emergence of a clear "food chain" within the wealth management industry. The industry is now segmented into the mass affluent ($100,000 to $1 million to invest), emerging affluent ($1 million to $5 million to invest), high-net-worth ($5 million to $20 million to invest), and ultra-high-net-worth (more than $20 million to invest) clients, each with differing needs, expectations, and product delivery systems. Products and strategies for the mass affluent client group, which will outpace all other segments in terms of annual growth rate in assets, are very different from the asset modeling and estate planning needs of the ultra-high-net-worth client group.

2. Explosive growth. There are 80 million households in the category of the mass affluent, growing rapidly toward 130 million. While growth is less impressive at the higher levels, both globally and in the U.S., the amount of cash and real estate under management at the higher levels is more significant. Even at the mass affluent level, the numbers are nothing to dismiss-$15 trillion already under management, growing to $25 trillion by the end of the year, according to a study by Celent Communications.

3.Collaborative tools are becoming more critical. While the industry has not moved online entirely, there is a growing need for clients to be able to access their financial information on a 24/7 basis, and greater demand for the investors to take a more active role in the management of their own portfolios. This is accompanied by a shift in the way in which wealth management is packaged and marketed, as product-centric strategies give way to relationship management strategies.

Overall, the market for professional financial planning tools and hardware is growing at about a 5 percent compound annual growth rate this year and for the near future, increasing to $2.7 billion by the end of the year, with spending on online wealth management technologies projected to be $1.2 billion, according to Celent Communications.

This year's review of professional financial management software includes six packages that represent the strongest products for each of the segments in the wealth management industry.

AdvisorPlatform 3.5

AdvisorPlatform is a Web-based system designed to enhance the client/advisor relationship through financial planning and services. Now in its fifth year, AdvisorPlatform has done an excellent job of capturing the advantages of an online service, effectively melding the functions of service, client collaboration, financial planning and portfolio management into an accessible, well-designed Internet service.

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