Investors remain skeptical of AI in financial advice

Only 38% of affluent investors are comfortable with artificial intelligence, according to Cerulli Edge-U.S. Retail Investor Edition.

This comes at a time when, as Cerulli pointed out, AI is used by provider firms as a back-end function for client meetings or for review of documents.

And a Million Dollar Round Table survey found AI is becoming more popular with Americans in both personal and professional settings -  including financial advising.

In fact, the MDRT survey noted that 70.8% of U.S. consumers who have an advisor think that advisors should use AI for at least one professional purpose. And using AI for smaller tasks is the safest way for advisors to avoid concern among clients.

Americans’ comfort level with AI

The MDRT survey also pointed out that Americans are the most comfortable with advisors using AI to automate tasks, such as conducting research, developing meeting summaries, etc., with 54.4% of Americans saying they agree they’re comfortable with it, including 70.7% of Americans with advisors.

On the other hand, MDRT found many Americans are not comfortable with advisors using AI for tasks that require more personal information. Across generations, 41.9% of Americans said that they are not comfortable with advisors using AI to provide tailored financial advice, although women and men do not agree on the subject.

Expanding the use of AI

But there is potential to expand the use of AI to include investment analysis, financial planning and asset mapping, Cerulli said. As providers increasingly look to AI for these functions, they must also work to assuage clients' concerns about AI as part of their advisor relationships.

Affluent investors’ comfort level 

As mentioned earlier, the Cerulli report said that only 38% of affluent investors are at least somewhat comfortable with AI technology. This percentage is roughly equal to the 39% who said the same in 2024, Cerulli pointed out. While younger investors are the most supportive of AI in their financial relationships — more than 60% of those under age 50 said they are comfortable — that level of support drops sharply among those investors who are in their 50s (to 42%), and the number is down to 16% among those who are age 70 and older.

“There seems to be little doubt that AI has the potential to make the financial services industry significantly more efficient,” said John McKenna, research analyst at Cerulli. “Currently, the emphasis is on non-value-added tasks, such as client meeting setup, note-taking and document review. However, broader adoption across the advisor-client relationship may be in the works,” he added.

Reasons for the low levels of comfort

Why do so many affluent investors have such low levels of comfort with AI? “The reason for the low levels of comfort is very similar to why comfort with online-only investment advice is so low,” explained McKenna. “It is that people place more trust in a human financial advisor than in outsourcing it to pure technology. AI is still very nascent, so there are a lot of concerns regarding its accuracy in delivering information, as well as how it may be used in a financial advice relationship.”

“When people pay for a financial advisor,” McKenna continued, “they are looking for a person on the other end of the table to talk to and get advice from that is tailored to their situation, something that is not readily replaced by an online-only service, let alone one powered by artificial intelligence.”

Helping AI play a role in business operations

What steps can financial advisors take with their affluent clients to help AI play a role in their business operations? “Advisors are increasingly adopting artificial intelligence tools into their practice, especially regarding note-taking and automating back-office tasks like client scheduling or document summary,” McKenna said. “By automating more of these tasks, it should help them scale their operations more efficiently and spend more time interacting with and helping their clients,” he added.

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