Will tech change advice?

The report also suggests that machines will do almost 40 per cent of communicating and interacting and up to 30 per cent of so-called “advanced tasks”, like reasoning and decision-making. 

It posits the theory that lawyers will become redundant, as will sales agents and even financial analysts.  

But, it interestingly argues that the role of financial and investment advisers will remain stable.

Is advice safe?

According to a 2018 study by Vanguard, The Future of Work, technology will likely impact “basic” skills such as recording information, and “repetitive skills” like receiving and processing information, monitoring and scheduling.

“Advanced” skills such as maintaining relationships, interacting with the public, persuading outcomes, applying knowledge, strategising, solving problems, thinking creatively and caring for others are likely to remain in the domain of the human being.  

Being a financial planner has historically been a very human endeavour and our read of this is that the human aspect will prevail.

Both reports suggest to us that robo-advice may not disrupt the financial advice industry like technology has in so many other sectors. 

But there is one nagging doubt on this, and it relates to our previous point regarding value for money. 

A 2016 survey of financial planners in the US highlighted that their number one challenge was to communicate their value-add to clients.   

Our suspicion is that robo-advice has this part nailed, since its main focus is value for money. 

As returns start to drop, the cost to clients will become all the more important and we wonder whether this may create the tailwind that the robo industry needs.   

Ultimately, we suspect this will not be the case and are inclined to agree with the studies we have quoted. 

However, a long enough period of low real returns from investment markets is probably needed as a final proof statement on whether digital advice will eventually become the norm, rather than the exception.

Rory Maguire is managing director of Fundhouse