Artificial Intelligence and the Human Touch in Financial Advisory
Artificial intelligence (AI) has become an integral part of the practices of many financial advisors in today’s digital age. While AI technology offers valuable insights and efficiencies, financial advisors emphasize that the human connection remains essential in their work.
A recent AI Readiness Survey conducted by Financial Planning, which polled 250 advisors, revealed significant trends in how advisors are implementing and perceiving AI in wealth management.
Emphasis on Soft Skills
The survey results underscore the importance of balancing technology with human touch. Advisors ranked soft skills above technical expertise when identifying the key talents required for success in the industry. Most advisors emphasized the significance of skills related to building and maintaining client relationships (58%) and in-person interpersonal skills (43%).
Despite the integration of AI tools in their tech stacks, advisors believe there is still room for improvement in enhancing the human connection at the core of their businesses. The tools most desired by advisors include those that aid in “client communications and management” (23%) and workflow management (19%).
Since good client relationships form the foundation of successful practices, it comes as no surprise that advisors’ greatest concerns regarding AI are related to potential threats to these relationships. The top risks identified by advisors include “risk of errors or unintended consequences” (67%), “loss of personal touch with clients” (56%), and “data security concerns” (55%).
Proficiency in AI and other technological tools is seen as a critical skill for advisors as technology continues to advance. 83% of advisors believe it will be much or somewhat more important in the coming years. On the other hand, 22% of advisors anticipate that “written communication skills” may become somewhat or much less important in the future.
According to the survey, the primary focus behind firms’ technology strategy is “improving client experience and satisfaction,” with nearly two-thirds of advisors highlighting it as their top priority.
Scroll down to read about other key findings from the AI Readiness Survey:
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