The life of a financial advisor is a bit like running a marathon with hurdles thrown in for good measure: between client meetings, research, compliance work and trying to grow your book of business, there’s hardly a moment to catch your breath. So how can AI step in to help without turning you into a spectator in your own race? Turns out, it’s more about giving you superpowers.
AI isn’t some distant, sci-fi robot uprising. While generative AI has captured our attention over the past year, machine learning, a subset of AI, has been well-established since the 1950s and has recently seen a resurgence as it is rapidly generating opportunities in the financial services industry, helping advisors streamline tasks, improve client service, and yes – find new leads.
Predictive ML is commonly used by big tech and was frequently used when I worked at A9, Amazon’s AI group. One common use case for this technology is to direct AI to sift through massive amounts of data to determine items that might be of interest to buyers. On the other hand, GenAI, popularized via OpenAI’s ChatGPT and other chatbots, creates rich content or human-style responses after being prompted.
Here are some ways both types of AI can help financial services professionals in their daily activities, today and in the near future.
Lead Generation and AI as Your Always-On Personal Assistant
The wealth management industry’s core growth has been stagnant for years, hovering between 3% and 4% when we strip away the influence of market fluctuation and mergers and acquisitions. This trend shows little sign of reversing, with Chip Roame, founder and CEO of Tiburon Strategic Advisors, revealing that the industry's organic growth in 2022 was a mere 2.4%. He cautions against expecting significant improvement. In order to continue to scale and do so at a more rapid pace, advisors need to grow via organic search powered by AI.
Imagine if every time you sat down to drum up new leads, you had an assistant who never sleeps and can sift through trillions (yes, trillions) of dollars in global wealth looking for the right match. AI-powered lead generation tools do just that, and they’re changing the game. With an estimated $100 trillion of global wealth creation in the next decade, and $80 trillion in wealth transfers from baby boomers to millennials, there’s a ton of opportunity just waiting for you. Combine that with a generation of customers who are embracing digital financial services, your opportunities for growth are significant. In fact, Ficomm reported that 57% of those under 44 hired their financial advisor thanks to digital marketing. This is a notable shift for an industry that historically relied on referrals. AI tools can help match you with these clients, zeroing in on prospects who are a perfect fit for your firm based on their financial needs.
AI can also help uncover nuggets of information that aren’t obvious, providing opportunities for prospecting that others haven’t learned about yet. For example, AI can function as a geographic predictive tool, allowing advisors to target areas ripe for growth or understand life events—like marriage, job changes or home shopping—that might mean the individual is ready for a financial advisor.
Financial Planning & Portfolio Analysis
Meet Jane Smith. Jane is 48, earns $150,000 annually and needs $60,000 for her daughter’s college tuition over the next four years. You won’t have to spend days analyzing how to manage Jane’s investments for this expense. Soon, AI will accomplish this in moments. With a single prompt, your AI will identify which assets to sell or keep, maximizing tax advantages while safeguarding her retirement savings. AI will also be able to instantly simulate countless retirement scenarios. Gone are the days of waiting for internal specialists to process requests. AI-powered tools will quickly generate everything from easy-to-understand Monte Carlo simulations to charting dream retirement scenarios for clients. This shift will enable more meaningful conversations about finances and retirement planning options between advisors and clients as advisors will have more time to critically analyze the data. We can expect this scenario to unfold in the near future through GenAI applications developed for and by the financial services industry. Large firms may integrate this planning capability into their systems, while smaller advisory firms may adopt third-party tools.
Client Servicing
Have you ever had a client ask, “What’s going on in the market, and how will it affect my portfolio?” Instead of reaching out to analysts who will spend days generating a response, AI will soon give you viable responses in real time. With AI tools designed to analyze vast datasets, you can provide clients with instant, data-driven advice that makes you look like you’re plugged directly into Wall Street’s nerve center.
Large language models focused on financial services are being specialized to give advisors access to a wealth of historical and current market data. When will these systems be fully deployed? Say goodbye to the dreaded “I’ll get back to you on that.” You’ll have answers ready before your client’s coffee gets cold.
Administrative Tasks
Artificial iontelligence and machine learning have the potential to revolutionize the back-office operations of financial advisory firms by making data a more dynamic and accessible asset. By leveraging AI and ML, firms can automate and streamline tasks like appointment scheduling, freeing up human resources for more value-added activities. AI-driven analytics can quickly generate insights by answering complex inputs about client behavior, market trends, or internal performance metrics. This improves decision-making across operations, compliance, and client management. AI's ability to continuously learn from and adapt to new data ensures that financial advisory firms can stay ahead of client needs, regulatory demands and operational inefficiencies, making their back office not only more efficient but also more intelligent.
Social Media Content Creation
Social media marketing may not be every advisor’s favorite task, but with AI, it doesn’t have to be. GenAI tools can craft timely social media posts, creating content that aligns with current market trends, while you focus on your clients. With just a few prompts, you’ll have a polished LinkedIn post ready to go, and it might even go viral to reach new audiences (no promises, though!).
The AI Frontier: Where We’re Headed
Over the next few years, AI will increasingly become standard in every advisor’s toolkit. It will help you find more leads, make financial planning more efficient, and give you the freedom to focus on what really matters: your clients.
But there’s a caveat. With great power comes great responsibility—the Wild West of data privacy is real, and ensuring your clients’ information stays safe is paramount. As AI tools develop, ensuring compliance and data security will be just as important as the amazing services they offer. There will be an increasing number of entrants in the AI fintech revolution, and just as they come, many will go. Take your time to carefully vet and ensure the firms you work with have the same view on customer obsession that you do.
Satayan Mahajan is CEO of Datalign Advisory, an AI-enhanced platform matching consumers with financial advisors.
