For full disclosure, ChatGPT is frighteningly good at my job. It can’t replace me just yet… but it’s only a matter of time before technology is able to replicate critical thinking and ask probing questions.
But how about financial advisers? Could ChatGPT, or a similar specimen of AI, really replicate advice by collecting data from the world wide web and personalising it for each individual seeking help?
Here’s what the AI had to say when asked “will ChatGPT take over the financial advice industry and make advisers redundant?”
It is possible that advanced language models like ChatGPT could play a larger role in the financial advice industry in the future. The technology is able to process large amounts of data and provide accurate and personalised advice to individuals seeking help with their finances. However, it’s important to note that financial advice is a complex field that requires expertise and experience. Human financial advisers bring to the table the ability to understand the nuances of individual financial situations and provide tailored advice accordingly. It’s also important to note that financial advice is not only about providing accurate information but also about building trust and providing a human touch.
Moreover, the use of language models like ChatGPT can be seen as a complement rather than a replacement to human financial advisers. It can help financial advisers with the data analysis and provide them with a better understanding of their clients’ needs, which can help them provide better advice.
In conclusion, while advanced language models like ChatGPT can play a role in the financial advice industry, it is unlikely that they will entirely replace human financial advisers. Financial advice is a complex field that requires expertise and experience, and human financial advisers are still the best option to provide the tailored advice that clients need.
Adele Martin agrees.
‘A lot of pros’
Speaking to ifa, the founder of My Money Buddy and the Savings Squad podcast said she sees potential in ChatGPT.
“It’s early days and still lots of errors especially as it only has data until 2020, but I definitely think it has a lot of pros,” Ms Martin said.
Some advisers, she told ifa, are already using the technology to draft their client emails.
“I think it has a lot of potential for simple/not complex advice — with advisers checking the advice or perhaps in time, consumers using it as a self-directed service,” Ms Martin added.
According to ChatGPT itself, the cut-off date for the version currently in use is 2021, which means that the model’s knowledge and understanding of events, facts, and information are current up to 2021.
But the tech is bound to get a lot more sophisticated following Microsoft’s announced multibillion-dollar investment.
Referred to as a “game-changing investment”, this could see the AI behind ChatGPT deployed across a myriad of Microsoft products including Word and Outlook.
Bespoke, tailored advice to survive
Glen Hare, adviser and co-founder of Fox & Hare, told ifa that while he does believe there is space for AI in advice, there will always be space for personal, bespoke advice, delivered by a financial adviser.
“The reason I say that is there’s been a huge increase in general advice mediums or platforms over the course of a number of years, from financial literacy podcasts, numerous books, and also the rise of the finfluencers providing general advice through social media networks. Often the feedback we get from people reaching out to us is that they get mixed messages. So there is one particular platform will say one thing, another platform will say another, and it can become quite overwhelming because of those mixed messages,” Mr Hare said.
“That’s where the opportunity I believe lies for the financial advice industry, to really break through all that noise and to provide bespoke tailored advice,” he continued.
According to Mr Hare, while AI and ChatGPT are designed to provide responses to questions posed by a consumer, what’s crucial is the confidence their answer or advice bestows on that consumer.
“If they don’t have that confidence in that advice, it is the default to do nothing which may not be the right decision. Whereas the adviser can naturally handhold that particular member through that experience,” he concluded.
AI is not replacing the advisers, it’s replacing IFA itself. it’s the Divination itself without the “f”, the breath.
It is useful for completing Financial Advice assignments, proving yet again university qualifications are next to pointless. The real exams that are needed is working with real clients & tech services every day.
roboadvice, AI, etc, etc is all a threat to average advisers offering average advice to the mass affluent market. But advisers that genuinely set themselves apart, like really, with exceptional service and outstanding advice, will always be n demand, always able to demand a premium fee and never too concerned about these evolutions.
AI will not replace advisers, but it will certainly help us.
AI is essentially Google on steroids, but it only provides a response in answer to whatever question it is asked. The big skill of advisers isn’t so much knowing the answers to these questions, but knowing which questions to ask.
People use advisers now because there is so much information out there that they don’t know where to start. AI will give them an answer, but it doesn’t give the consumer the confidence it is the right answer.
I’m more excited than worried.
It is really very early days for AI programs such as ChatGPT but already it is extremely impressive and can replace many of the functions (particularly low level, simple functions) in a practice. It is programmed with the ability to communicate empathy and is very good at basic problem solving – including simple complaint handling (short of the type of matter that needs to go before something like AFCA).
Form a compliance perspective, it is poor and not accurate in terms of technical issues (at this stage!). It is probably years away from being able to handle complex advice or complex technical situations, but great in putting together basic standard documents which require the input of standard variables – e.g. basic SOAs. Contract paraplanners should be very worried, if the Quality of Advice Review recommendation to do away with SOAs was not worrying enough for them.
ChatGPT is what the military call a “force multiplier” enhancing the ability of technically competent good advisers to get work out the door and substantially improve their productivity and profitability. For the low level “standard cookie cutter solution” type adviser dealing with “C” and “D” type clients with basic needs it will be bad news, particularly as it improves out of Beta and its abilities are enhanced by linking it to real-time information databases – including financial product live feed databases. These latter advisers will need to reconsider their career options in the next few years..
The answers will only be as good as the questions. That is the biggest challenge for AI, it seeks answers in its database. Will it be able to interpret what a client doesn’t ask – implicit advice need? What about body language. Will it get clever at that?
100%. As an example, I often have to explain how minimising tax isn’t a wealth creation strategy – but so many come to me as they want to minimise tax.