Automation has reshaped nearly every industry, and financial services are no exception. Robo-advisors offer a digital-first experience that appeals to clients who value efficiency, convenience, and low-cost entry points, particularly younger investors building their financial future. A robo-advisor is any digital platform that provides automated investment and financial planning services conducted by an algorithm and without human supervision. These platforms have set a new baseline for what clients expect during onboarding and data collection: speed, simplicity, and personalization. According to one survey, 20% of affluent millennials use robo-advisors, compared to only 9% of investors aged 47 to 54. The robo-advisory market, currently valued at $9.5 billion, isn’t going to stop growing anytime soon. Future projections anticipate a robo-advisory CAGR of 29%, worth $72 billion, by 2032.
But automation doesn’t have to be the enemy of the advisor. In fact, when used strategically, it can be your greatest ally. Your tech stack is meant to step in and increase the trust, guidance, and empathy that only a human advisor can provide.
If your goal is to offer high-quality, high-touch service without sacrificing efficiency, it starts with how you collect and use client information. Here’s how to do it right.
Build and Strengthen Relationships
Trust is the foundation of a strong client-advisor relationship. Unfortunately, one survey found that half of Americans are more likely to trust robo-advisors than traditional human advisors. Human advisors can combat the growing distrust by focusing on building relationships and showcasing their credibility and uniquely human skills. Robo-advisors are sterile — hands-off. Humans are adaptable and can showcase their skills and expertise by actively listening to clients and showing an in-depth knowledge of their needs.
Trust is demonstrated by understanding clients. Robo-advisors make product and investment recommendations based on algorithms and patterns. Many human advisors leverage the same technological resources, but they add a layer of human emotion and understanding to deliver personalized recommendations. Advisors can also adjust their offerings to meet client needs, such as adding tax or retirement planning tailored to each client’s circumstances.
A study from Vanguard found that 88% of clients using a robo-advisor say they would be willing to switch to a human advisor. Conversely, only 4% of clients using a human advisor said they would switch to a robo-advisor. The lesson? Clients connect with human advisors, especially those who prioritize human connection and things like understanding their goals and active listening.
Teach and Work Through Complex Problems
Financial advisors do more than just manage investments. They also educate clients, help plan their futures, and coach them through major life stages. One of the top things clients look for in an advisor is skills and expertise to help them understand complex financial situations.
Robo-advisors may be able to link to relevant articles, but they can’t teach like humans can. This is especially true for complex financial issues or questions. Advisors can provide context and personalized answers. They can tailor their education approach to each client’s needs.
Successful human advisors empower clients by answering their questions and explaining financial issues. They help simplify complex topics and demystify challenges that may seem overwhelming. By leaning into the educational side of advising and being a valuable resource for clients, advisors can stand out from robo-advisors.
Integrate Human Touch and Tech Efficiencies
In today’s technology-driven world, the decision between robo-advisors and human advisors isn’t black and white. Most clients don’t want to rely completely on technology to reach their financial goals, but they also don’t want to rely totally on humans. The best solution: finding a balance between the human touch and the efficiencies of technology.
The wealth management experience for clients is often full of filling out repetitive forms, waiting to have questions answered, and not having an updated or accurate view of your investments. Integrations solve many of those issues and free up advisors’ time to answer questions and provide personalized financial advice. Integrations, such as combining forms, utilizing digital signature services, and pulling data from multiple sources into financial planning software, enhance the client experience and provide the convenience of a robo-advisor with the personal touches of a human advisor. Human advisors who can prioritize their human characteristics while creating streamlined technology workflows can gain a strong competitive advantage.
Advisors have a powerful opportunity to turn routine processes into moments of connection. Instead of sending clients off to fill out forms on their own, fill out the information with them. Get side by side during meetings or keep the PreciseFP “Add” screen open during discovery calls, so you can input details in real time. This approach saves clients time and builds trust from the start. Even better, PreciseFP keeps the data flowing from one conversation to the next, so clients are never reentering information you already gathered. Forms come prefilled, and each meeting picks up where the last left off. That’s the kind of thoughtful, seamless experience no algorithm can replicate.
Try PreciseFP free and see how it transforms your client conversations.
