The finance industry may be going robo, but that doesn’t mean that’s exactly what the client wants.
In fact, independent data from two retirement providers indicates that the country’s appetite for full robo retirement advice is low.
A Northwestern Mutual study has found that the majority of respondents — 54 percent — said the ideal method of receiving financial advice is a combination of a human relationship with technology, with 33 percent saying that they preferred a human relationship above all else.
And in a John Hancock survey, investors ranked face-to-face meetings as their preferred method of interaction with their financial advisors, followed by phone calls and then by e-mail.
Related: From robo-advisors to human advisors
Even among millennials, the yen for a strictly automated solution wasn’t strong; fewer than 2 in 10 of that age group, said Northwestern Mutual, would opt for a completely automated offering. In addition, nearly 50 percent of respondents said they had “no interest at all” in robo.
While 53 percent said they’d be open to trying automated advice, only 7 percent said they were “very” or “extremely” interested in doing so. Instead, what came across loud and clear was people’s desire for a human aspect to the financial relationship. And women were even less interested than men in automated advice; 50 percent said they were “not at all interested,” compared with 43 percent of men.
Among the nearly 50 percent overall who just aren’t interested, there were plenty of reasons: 48 percent wanted a human advisor who can answer questions and discuss options; 40 percent didn’t trust the robo option; and 38 percent said they wanted the knowledge and expertise of a human advisor. This last was most prominent among millennials, who spend so much of their lives in a digital atmosphere but nonetheless value the human touch when it comes to financial planning.
And the John Hancock survey revealed that people think less of robo-enhanced relationships with advisors. Asked how to improve their relationships with financial advisors, 3 in 10 (31 percent) say more in-person interaction is the best solution, while nearly one in five think that regular electronic updates about their account is the best way to improve client experience. Few believe that online self-service tools (11 percent) or regular updates on financial markets (5 percent) would significantly improve their experience.