Artificial Intelligence: 3 Positive Developments for Financial Advisors

21 September 2023


“Artificial Intelligence is an innovation that will change everything, including financial advisory”.

You’ve probably read many articles about the advent of Artificial Intelligence described as a threatening force that will sweep away our jobs and that, perhaps, if it ever becomes a super AI (Artificial Intelligence with superhuman capabilities), will be able to self-program and evolve to take over humanity. These predictions may be excessive, but one thing is certain: generative AI, such as Chat GPT, is a technology that has the power to completely transform not only economic activities but also the structure of our society. It is one of those technologies that are referred to as general-purpose, essentially capable of causing a paradigm shift. In the past, inventions like the steam engine, the telephone, the personal computer, and the internet have been such technologies.

This is not a discussion about the future; this revolution is already underway. The integration of generative AI is already drastically changing many products and services we use every day, especially in the digital world, from search engines to creativity and productivity software. Even the way people and businesses work and learn is changing.

The message is clear: Artificial Intelligence is not just hype, like innovations that generate a lot of talk but have only sectoral impact or make mostly noise, such as NFTs or the Metaverse (who remembers that?). Artificial Intelligence is something much more pervasive; it’s here to stay and will change everything, including financial advisory.

Simpler and more repetitive jobs will be the most affected by the revolution.

A lot has been written and studied about the impact on the world of work, and concerns are legitimate and widespread, just think of Hollywood actors who strike against the risk of being replaced by technology. But most theoretical models on the employment impact of AI converge on some conclusions.

A “Butler” for Financial Advisors

You’ve probably been reading for the past 10 years that Robo-advisors will replace flesh-and-blood financial advisors and that fintech will eliminate banks: not only has this not happened, but it probably never will.

Certainly, in some conferences or on online channels, you may have heard some guru predict that the impact of Artificial Intelligence will make financial advisors disappear too, to be replaced by AI-guided Robo-advisors.

The first good news is that even Artificial Intelligence will not eliminate financial advisors. However, be aware that AI will radically change their profession.

It’s the very essence of the financial advisor’s profession that makes them irreplaceable. Elements like empathy, deep knowledge of the work and family context remain far beyond the current and foreseeable capabilities of AI.

The second good news is that Artificial Intelligence can provide financial advisors with a personal assistant, almost like a “butler,” who will take on a lot of hassle for them (without complaints or paid vacation), improving their work and making it more productive.

While Artificial Intelligence is fortunately still far from being able to replicate the complex mosaic of our emotions and soft skills, it is certainly much better and faster than us at doing calculations. Students worldwide understood this immediately: GPT-4 in the United States scored higher than the average students on the bar exam for lawyers (76 to 68).

The third good news is that by using Artificial Intelligence platforms for financial advisors like the one we’ve developed at Wealthype.Ai, it’s possible to increase customer satisfaction through scalable personalization, focusing on and measuring the level of financial well-being and specific needs of each client.

With Artificial Intelligence, you can personalize not only the portfolio and service for each individual client but also the communication. Imagine content and marketing materials that are not only aesthetically pleasing and well-crafted but entirely customizable based on the preferences and needs of each client. Sounds great, doesn’t it? Today, all of this can be achieved with just a few clicks.

More Time Out of the Office and Satisfied Clients

The paradoxical conclusion is that it will be a digital personal assistant guided by AI that will allow financial advisors to lead a more “analog” life, spend more time outside the office, or manage more clients, meeting them and spending more hours with them.

Some statistics, not only in Italy, about the financial advisor profession say that some advisors spend up to 30-40% of their time assembling documents to prepare for client meetings. Truly a huge amount of time wasted.

I don’t want to sound exaggerated, but I believe that AI represents an extraordinary opportunity today for those open and curious financial advisors ready to use Artificial Intelligence. Those who embrace this change now will be able to take their profession to the next level and work less and better. On the other hand, those who don’t hop on a train that is already running very fast will end up like those who, when the automobile arrived, preferred to continue traveling by horse.

If you’re curious to see how a platform developed for financial advisors works (and along with financial advisors!), you can visit our website and send us your questions to learn more

At Wealthype, this is precisely what we focus on, and we have already helped thousands of advisors improve their work. For a demo of our tools, you can contact us using the link below and discover how to apply Machine Learning principles to your business processes.