How AI is transforming wealth management

November 8, 2023 12:37 PM

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Leveraging OpenAI technology to communicate quickly and effectively with clients, utilizing an AI-powered assistant to enhance estate planning and maintaining the human touch to ensure AI-generated content is not cookie-cutter are among the ways wealth managers are incorporating AI into their daily lives.

Read our roundup for more on these and other stories that show how AI is changing the industry.

AI is good, but advisor touch can make it better

Generative AI has the potential to transform the way advisors communicate with their clients. But how do you avoid automated content from looking like it was created on autopilot?

Many advisors are already using generative AI for things like email automation. "They say, 'It's fine, but they do everything for me, and when it comes out it looks the same as every other advisor," said Jason Friedman, CEO of AdvisorFinder. "I want to put my own spin on it, but I don't know where to begin."

Indeed, far from replacing the advisor, Friedman believes human oversight is more important than ever to avoid generic content that lacks the personalization that the advisor should be delivering.

Read more:

How human advisors can bring out the best in generative AI

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AI options offer industry leaders food for thought

The rapid rise of artificial intelligence and its potential to change the way the wealth management industry works has senior executives pondering how AI can best benefit their organizations.

From using a chatbot as a research assistant with generative AI answers to advisors' questions to deploying AI as a defense against fraud, wealthtech firms offer a variety of AI solutions.

Here are the insights of six wealthtech leaders on what the future holds.

Read more:

How advisors are taking advantage of wealthtech's AI enthusiasm

China's ChatGPT Stock Frenzy Cools Amid Reported Regulatory Ban

Bloomberg

New OpenAI tool is ready to speak up for advisors

It seems that ChatGPT has only just entered the lexicon, and now we already have Wealth Management GPT, the brainchild of Marc Butler, former president and CEO of Skience, a financial services software and consulting provider.

Intrigued by the possibilities of using OpenAI tech in the industry, Butler asked himself the question, "How do you take a [new] type of technology and make it really easy for advisors to use?"

The answer is Wealth Management GPT. With a pilot program up and running, Butler talked with Financial Planning about his new baby and the potential of generative AI to change the industry.

Read more:

Using AI to help advisors find the right words

AI-powered assistant gives estate planning a boost

A recent survey found that the vast majority of clients want guidance from their advisors with estate planning, but the majority don't get it.

That's where artificial intelligence can help, according to Wealth.com, and specifically "Ester," the firm's recently launched AI-powered estate planning assistant.

"Ester was developed to support individuals at all levels depending on their financial literacy and support advisors as they support their clients on the navigation through the process of creating estate planning documents," said Eduardo Fontes, senior vice president of data science at Wealth.com.

Read more:

Should your firm hire an AI legal assistant to help with estate planning?

Wealthtech leaders dissect the pros and cons of AI

Artificial intelligence in wealth management is here to stay, but alarmist conversations about chatbots replacing humans fail to recognize the value of the human touch, according to Daniel Crosby, the chief behavioral officer of Orion Advisor Solutions.

"Any task that requires consistency, tedium, speed, recall, memory, AI is going to be better than us all day long," said Crosby. "But when it comes to things like connection, creativity, empathy and sales, that's where humans really shine."

Crosby was among the advisors, tech entrepreneurs and behavioral finance experts who discussed the challenges for advisors in adopting AI technology during three sessions at Financial Planning's annual INVEST conference. Here are their perspectives on the pros and cons.

Read more:

Where AI wins — and doesn't — in financial advisor technology