‘Advice will always be human’

Amal Jolly explores the future of advice and the inevitable use of artificial intelligence…

Financial advice is progressing, and many advice businesses will look different in five years’ time because of artificial intelligence (AI).

I think technology is going to have a really positive impact on the way humans can give better advice to more people.

This debate is slowly coming into focus now that AI is making a discernible and noticeable impact on the advice profession. This is a really important conversation to have – it’s something we should all be thinking about and debating.

There’s no doubt it’s going to affect everyone and their businesses in some way, but advisers need to be intentional in how it transforms their firms and the way their teams work.

Advice will always be human

Many roles in the advice sector right now will not look the same in five years’ time, but I believe humans will still be the focal point of the proposition, delivering advice to clients face-to-face and helping people make crucial, life-changing decisions.

In fact, advisers will be able to spend much more time with clients, paraplanners will be more specialist, becoming experts in the more complicated cases, and administration staff will spend more time supporting advisers and paraplanners, not chasing paperwork and dealing with spreadsheets. AI is being developed to support advice firms, not replace them.

Hundreds of businesses are seeing hours saved in meeting workflows, suitability letters, data extraction and analysis, and compliance monitoring. That’s all time that can be reinvested directly back into clients.

There may well be advice firms that try to cut jobs and replace roles with AI, but that’s not how we see the majority of businesses progressing. Instead, we think the work people do in the background to power advice will change.

For us, humans are always going to be at the forefront of financial advice.

That’s not to say AI isn’t going to power several new ‘robo’-like propositions. I’m sure that will be the case, and it’s inevitable there will be new challengers to the current order, as there is in any market when technology tries to disrupt it.

But that just means, alongside targeted support, there’s going to be more options for financial help and a more diverse range of ways for people to access and receive it.

Existing advisers shouldn’t be worrying too much about what newcomers or other types of propositions will be doing, because by embracing AI, they are going to be able to progress significantly themselves.

With AI, advisers are going to be able to cut out so much of the time-consuming admin and compliance work that the cost to serve advice is going to plummet. Today it costs most advisers around £2,000 per client per year to maintain the ongoing advice relationship, but AI has the potential to reduce that figure dramatically over the coming years by removing repetitive, time-consuming tasks that hold teams back.

We absolutely believe that the demand for people to pay to sit down and speak to a human, to run through their financial plan and talk about their concerns, will continue. We know how much clients value the human element of financial advice and financial planning. They will undoubtedly continue to pay for that connection, to maintain a trusted relationship with a human, not an AI robot or avatar that delivers the service a tiny bit cheaper.

As Premier Wealth Solutions IFA How AI will shape the future of advice told us:  “Advice will always be human. Every firm has its unique challenges… But something unanimous to any adviser is the burden of regulation.”

There are more than 30,000 advisers in this country who, with the power of AI to free up more of their time, can each serve many more clients. This means two things: the cost of human-delivered advice is going to drop, and so more people will be able to speak to and get financial peace of mind from a human financial adviser.

It’s an incredibly exciting time for financial advice professionals. There is a huge opportunity to transform the way humans deliver advice and connect with more clients.

Those who embrace change and allow AI to help transform their businesses to become more efficient and improve compliance processes will see the great benefits it has to offer them.

The future of the advice market isn’t clear, but one thing is clear to us: advice will always be human.

Amal Jolly is CEO of Saturn