MDRT Study Finds Consumers Want Technology to Complement, Not Replace Human Financial Advisors

85 percent of Americans prefer working with a human financial advisor
rather than a robo advisor

PARK RIDGE, Ill.–(BUSINESS WIRE)–lt;a href=”https://twitter.com/hashtag/MDRTFinTech?src=hash” target=”_blank”gt;#MDRTFinTechlt;/agt;–A new study examining what consumers think of technology in financial
services finds the majority of Americans (88 percent) want technology to
complement, not replace, the assistance of a human financial advisor.
Only five percent state financial planning should be managed entirely by
technology-based tools. The study was commissioned by MDRT
and conducted online by The Harris Poll among over 2,000 U.S. adults.

“Due to their experienced insight, expertise and personal touch, human
financial advisors are still in high demand amidst the growth of robo
technologies,” said Ross Vanderwolf, CFP, MDRT President. “Despite that
consistent demand, this study shows that it behooves advisors to
continue to integrate innovative technology into their practice for
continued growth and success.”

While 83 percent of Americans would trust a human
financial advisor to effectively manage their financial plans, only 36
percent would trust the job to a robo advisor. Moreover, 85
percent say they prefer working with a human financial advisor rather
than a robo advisor. In addition, 36 percent strongly disagree that robo
advisors could completely replace the role of human financial advisors
in financial planning.

The Human Advantage

The top benefit Americans cite for working with a human financial
advisor over a robo advisor is the opportunity to build a trusting
relationship (65 percent), followed closely by the high level of human
interaction (58 percent) and ease of communication (52 percent). The
main concerns of working with a human financial advisor are cost (47
percent), response time (32 percent) and accuracy of assessments (31
percent).

The top benefit of working with a robo advisor over a human advisor,
according to Americans, is minimized risk of human error (49 percent).
The main concerns are lack of two-way conversational communication (58
percent), minimal human interaction (48 percent) and breach of data,
including personal (46 percent) and financial (44 percent).

Generational Preferences

When it comes to hiring a financial professional or using technology,
millennials (ages 18-34) are split. About half (52 percent) would trust
a robo advisor to effectively manage their financial plans, while the
remaining 48 percent would not. Millennials are also twice as likely as
some of their older counterparts (ages 45+) to agree that robo advisors
could completely replace the role of human advisors in financial
planning (38 percent vs. 17 percent). Of millennials who currently use a
human financial advisor, the majority prefer their advisor utilize
various technology-based tools to manage their business. An internet
platform for scheduling appointments is important to 84 percent of
millennials with an advisor and 78 percent state a platform to host
virtual meetings is a priority.

Older Americans (age 45+) are far less likely than millennials to trust
a robo advisor to effectively manage their financial plans (24 percent
vs. 52 percent). Only 17 percent of Americans age 45+ agree that robo
advisors could completely replace the role of human advisors, and 44
percent of those age 65+ say there is no benefit of working with a robo
advisor over a human advisor. Older Americans (age 55-64) who work with
a human advisor also value their advisor utilizing various updated
technology-based tools to manage their finances. More than three out of
four consider cloud technology for storing/accessing client plans (80
percent) and an internet platform for scheduling appointments (77
percent) valuable tools for their advisors to incorporate.

“This study suggests Americans have not outgrown human advisors; instead
their preference lies in combining the personal and trustworthy touch of
an advisor alongside cutting-edge technology,” said Regina Bedoya, CLU,
ChFC, MDRT First Vice President. “An integration of tradition and tech
will provide Americans an even brighter financial outlook. By keeping
advisors abreast of client desires and technology’s ever-increasing
capabilities, MDRT stands poised to assist advisors in ushering in the
future.”

For a high-resolution infographic that explores the desired relationship
between human financial advisors and technology, please contact Carrie
Kaniecki
.

Survey Methodology

This survey was conducted online within the United States by The Harris
Poll on behalf of MDRT from November 1-5, 2018 among
2,008 U.S. adults ages 18 and older, among whom 771 currently work with
a human financial advisor. This online survey is not based on a
probability sample and therefore no estimate of theoretical sampling
error can be calculated. For complete survey methodology, including
weighting variables and subgroup sample sizes, please contact Carrie
Kaniecki
.

About MDRT

MDRT, The Premier Association of Financial Professionals®, is a global,
independent association of more than 66,000 of the world’s leading life
insurance and financial services professionals from more than 500
companies in 72 nations and territories. MDRT members demonstrate
exceptional professional knowledge, strict ethical conduct and
outstanding client service. MDRT membership is recognized
internationally as the standard of excellence in the life insurance and
financial services business. For more information, please visit www.mdrt.org and
follow them on Twitter @MDRtweet.

Contacts

Giang Ngo
MDRT
+1 847.993.4928
gngo@mdrt.org
@MDRTweet

Carrie Kaniecki
G&S Business Communications
+1
312.648.6700 (ext. 2113)
ckaniecki@gscommunications.com
@gs_comms