The unknown relationship between financial planning & AI

Let’s be honest, Artificial Intelligence (AI) is transforming industries, and financial planning is no exception. The question is, will AI swallow up the roles of financial planners and client managers (paraplanners)?

Here at Equilibrium, we are just at the beginning of our journey and relationship with AI... 

The Past

Before jumping straight in, it is worth taking a step back and reminding ourselves that the introduction of AI is simply a shift in technology and something that we have all likely faced in the workplace before, perhaps without even realising it.

I remember starting my journey with Equilibrium in 2008, mid-credit crunch when clients would form an orderly queue outside the building to sign paper switch forms to exit out of property funds.

At the time, that was the best we could do, but 16 years later, I am certain if I rang a client and asked them to sign a fund switch form, it would (rightly) fall well below their expectations.

The Present

Fast forward to today, technology has certainly shifted within financial services. We now have wrap platforms, instant valuations & online access, various messaging systems along with real-time trading – a significant amount of change that has only improved outcomes for consumers.

Looking around the office, calculators continue to be present on desks. This is despite Microsoft Excel being launched almost 40 years ago. Microsoft Excel can handle more complex calculations, it is more accurate and often quicker than a calculator. Therefore, when considering the present day and the introduction of AI, it’s important to understand a new technology doesn’t have to revolutionise the existing means, instead, it can be an evolution or used in conjunction with.

So, how is AI currently being used at Equilibrium?

I mentioned at the start, we remain in the early stages of our relationship.

We are currently trialing Saturn to improve the level of information captured during meetings and shorten the time involved in producing the meeting summary with the aim of repurposing this time and energy to where we feel we can add so much more value to our client and their loved ones.

There also lies huge efficiencies with AI when it comes to data interpretation, and we are also trialing 4Admin which can scan through pages of data and then promptly produce a digestible summary ready to form part of the client file and advice process.

Challenges and opportunities

Tried and tested processes may no longer be fit-for-purpose alongside new cutting-edge technology. Change management is therefore essential. Extra training for the team needs to be arranged and communication with clients must be clear to retain the human and personal touch.

There are, however, massive opportunities. Unfortunately, humans cannot create more time during the working day and fortunately for us, AI is not able to display emotional intelligence.

This is where the opportunity lies.

If used well, AI has the potential to save financial planners and client managers a significant amount of time by automating or removing low value tasks that can consume the days, if not weeks, of our working year.

We will be onto a long-lasting partnership if this time can be refocused on dealing with higher value activities that AI cannot even come close to.

The Future

For anyone who has recently renewed their car insurance, I would bet a reasonable sum of money you renewed online without the need to interact with another human.

However, if you have claimed on your car insurance, I would bet the same sum of money that you registered the claim via telephone rather than submitting a virtual form to ensure you had been listened to and understood, perhaps even requiring an extra level of support and reassurance. At Equilibrium, we understand this and believe the relationship between money and clients is best facilitated by a person who can listen, support and deliver.

Amid these technological advancements, the importance of a human touch and the ability to provide real personal insight and reassurance as to how your financial plan links to your goals and aspirations remain indispensable.

There is a phrase that humans like doing business with humans they like when all things are equal. I would take this one step further to challenge.  Ultimately humans like doing business with humans they like, and that delivers results. 

Take my son Henry for example, and my friend Connor, who recently qualified as a doctor. 

Should Henry have an upset stomach, and Connor is unable to treat him and find a remedy, no matter how much I like my friend, I will inevitably seek an alternative doctor to pursue a remedy. Whilst people like doing business with people, people ultimately want results.

Our purpose at Equilibrium is ‘making people’s lives better’. Suppose AI can take away the low-value, and often drudgery tasks whilst freeing up time and capacity to do more work that only a human can do, such as providing emotional support to a family during a bereavement or invaluable guidance during the decision to retire. If that is the case, the benefits for staff will be huge and in turn, so will the results for our clients.

Question: Is AI coming for the jobs of financial planners and client managers?

Absolutely not, AI is coming for our tasks which will lead to change.

There is almost one certainty though; at the time of writing, AI will never stay the same, it will only improve from this day forward as it continues to revolutionise industries.

This blog is intended as an informative piece and should not be construed as advice.