Peter McCarthy’s clients were facing a problem most people would love to have – how to keep track of their many assets.
While McCarthy’s financial advisory firm had plenty of software tools to track the businesses of its 100 high net-worth clients, calculating their total wealth involved updating a list on a piece of paper or spreadsheet.
“The ability to provide advice depends on the quality of the data you have at your disposal,” says McCarthy. “I wanted to build a tool that the client and adviser could work together on that would make sure the data was alway up to date.”
In 2009 McCarthy sold his company to a subsidiary of IOOF and turned the prototype he had built for the firm into a personal wealth management app called MyProsperity.com.au. The program applies the smarts of today’s online accounting software such as automatic bank feeds and integration with financial services to monitoring lists of assets for individuals.
While Mint.com has enjoyed success in the US, it is the big four banks who have moved most aggressively into personal financial management. This presents a competitive threat to accountants selling advisory services, McCarthy says.
“Accountants want to move into other areas such as wealth management, succession planning, and that’s where the institutions are heading as well,” McCarthy says. “I think it’s those that have the best digital solutions that will thrive.”
MyProsperity.com.au has 1,000 users tracking home loans, bank accounts, superannuation and vehicles. It is also available as a white-label service for accounting firms which can use the software to cross-sell their advisory services.
A user can enter the address of their home or investment properties and get an estimate of their value from property services company RPData. If they want to get a more exact valuation, MyProsperity sends a notification to the accountant to follow through on the inquiry.
The online accounting program takes feeds from various sources to track the changing value of assets. Vehicle valuation service Red Book, which provides pricing to used-car dealers, displays a price for your car depending on year, make and model.
MyProsperity uses Yodlee bank feeds to provide daily or weekly updates of transactions in personal and business bank accounts. Financial data feeds update retail and industry superannuation funds including self-managed super, trust accounts and partnerships.
Price feeds from the Australian Stock Exchange update the value of your share portfolio.
The app automatically categorises expenses and filters any reimbursements for your tax return such as motor vehicle expenses.
MyProsperity is available in three plans; the first is free, the second costs $14.99 a month and adds goal setting and budgets, while the $19 a month plan adds the ability to receive rental statements from investment properties.
Rent collected through MyProsperity is matched against transactions to linked bank accounts. A tax report for each property shows maintenance, land tax and other expenses.
The white-label version for accounting firms replaces the MyProsperity branding with the firm’s name. The app passes leads from clients inquiring about finance, insurance and estate planning to the appropriate section within the firm.
An integration with online SMSF manager Class Super updates funds listed in MyProsperity, and accountants can send updates through MyProsperity back to their Class Super account.
“The aim is to build the accountant’s brand online. Very few have a digital presence, at most they’re using online accounting software which is building the software company’s brand rather than their own,” McCarthy says. “They now have a platform to build their brand as a trusted advisor.”
The white-label service costs $400 a month per accounting practice.
“There’s a window of opportunity for accountants to roll this out to their clients and have them working from their systems rather than from the big financial institutions,” McCarthy says. “The accountants can control that data. And I think that’s really important.”