Human advisors still win out over digital advice, according to a report released Thursday by the Certified Financial Planner Board of Standards.
The report is one of a series from the board’s Digital Advice Working Group that was created to examine how digital advice and help from human advisors can coexist and be used to the advantage of the client.
Financial advisors remain the primary source for the delivery of financial advice, despite the availability of fully automated digital solutions. But clients expect technology to be part of their relationship with advisors, the report said.
“Clients expect and deserve a human-powered, digitally enabled solution to their financial needs,” said Kevin R. Keller, CEO of the board. “Financial advisors who utilize technology as a tool in the client-advisor relationship can differentiate themselves and create more meaningful, deeper conversations and longer-lasting relationships that produce better outcomes.”
The report showed that consumers want to have an integrated solution when getting financial advice as part of a “digital financial advice ecosystem, which contains five segments—technology, consumers themselves, regulation, firms and advisors,” the group concluded.
“Fears of technology replacing human advisors remain largely unfounded,” the group added in the report. “Rather, consumers will continue to gravitate toward working with financial professionals who utilize technology and grasp its importance.”
Another factor driving the integration of digital resources is new regulations. Technology helps keep advisors in compliance with regulators while also ensuring that their clients stay informed and engaged in the decision-making process, the report said.