“As much as I believe technology should only be used to support advisers, currently advice firms aren’t engaging with advanced technology enough to achieve some of the amazing benefits,” he went on.
“Instead, most [advisers] are probably only using 10 per cent of the opportunity and power that technology can provide.”
“If you can input your details and it make a recommendation across multiple elements, that is, keep some cash aside in case of x and y, amalgamate these two pensions on this platform, increase your pension contribution by x per cent and so on, then that already feels like a more knowledgeable and understanding suggestion than, say, stick all your savings in MPS-6.”
ChatGPT replacing advice ‘step too far’
Others in the industry have not been so quick to predict a ChatGPT takeover of financial advice.
Director at Altus, Ben Hammond, said ChatGPT could enhance financial advice, certainly, but he reckons a world where it replaces advice “is a stretch too far”.
“I’ve seen other blogs about getting it to write suitability reports,” said Hammond.
“It might build 80 or 90 per cent of it, but there will always be the customer sentiment the adviser needs to take into account. It’s the soft skills part of an adviser which will never go away, no matter how good the tech gets.”
Hammond can envisage ChatGPT propping up simplified advice, but for more complex clients - ie, those hundreds of thousands richer - he does not think the AI chatbot would ever be enough.
Director at the Lang Cat, Mike Barrett, agreed with Ely-Johnston that the adviser profession is behind the curve in terms of technology adoption when compared to industries like banking.
But despite the scope for improvement, Barrett said full-blown financial advice will almost always be delivered face-to-face, even if it’s via video.
“We’re already seeing face-to-face interactions dominating in client segments approaching retirement.”
Lang Cat research from 201 advice firms found their average client was aged 59. This is compared to the average age of a customer using a direct-to-consumer investment platform like Hargreaves Lansdown, Vanguard or Interactive Investor, who is in their mid to late 30s.
“Fundamentally, way more discussions need to happen for someone in their late 50s,” said Barrett.
“The value is the discussion and peace of mind that yes, they can afford to retire. And a lot of advisers deliver peace of mind when people die.
“Tech should and could be doing a lot more, but face-to-face is what customers value.”
