Execs from Fidelity, Citi, and Kaplan say that generative AI will have a huge impact on efficiency and financial education, but it won’t replace the advisor-client relationship.
Morgan Stanley made waves when it announced last month that it’s letting its wealth management advisors use ChatGPT – the buzzy tool that can answer questions in a human-like way – to work more efficiently. The firm trained ChatGPT on about 100,000 pieces of its own proprietary research, so that its advisors can easily retrieve and digest large amounts of data without manually combing through reports.
Now, execs from other wealth management firms are chiming in with ways that they think AI will reshape the industry.
For one, these tools will revolutionize financial education, Fidelity’s vice president of AI research, Sarah Hoffman, told Bloomberg. “While we may not want these tools to advise customers directly, they can help educate employees,” she said, “And even help customers prepare before they meet with representatives, so they can ask better questions.”
Citi Global Wealth’s chief investment officer, David Bailin, agreed that AI “will absolutely improve client education” and reduce the time it takes for advisors to complete repetitive tasks. For example, adding relevant content to client communications or digesting firm research. “It will be an incredible efficiency generator,” he said.
However, artificial intelligence won’t be able to replace human-to-human relationships, because wealth management is such a deeply personal and emotional topic, according to Kaplan Financial Services president Susan Kaplan.
After all, there’s nuance to a person’s financial situation that AI won’t be able to parse, people want to talk to someone they trust about big financial decisions, and pure profit-optimization doesn’t always best other priorities. That’s why many big firms like JPMorgan even hire behavioral scientists to help advise top clients.
“Often the ‘right answer’ is not mysterious, but convincing the client that it is necessary for the future of the family is the trick,” Kaplan said. “That is the moment that the psychological connection with the client and the family is the linchpin of success in the financial planning process.”