Are Your Client Relationships Robo-Proof?

Maybe the real question is “Do they need to be?”

Rather than feeling threatened by robo-advisors, many advisors feel the two worlds can peacefully co-exist. In fact, some advisors are using this “disrupter” as an opportunity to refine their business model.

How do clients feel about this subject? The “Generations Apart” study released in February 2016 by Allianz shows that 69% of both Baby Boomers and Gen Xers say they do not trust online financial advice.

And yet 46 percent of Gen Xers and 24 percent of Baby Boomers say they have some interest in exploring robo-advisors. Only 10 percent of both groups say they would be comfortable having their relationship with their financial advisor exist entirely online.

But before considering whether to do financial planning online, your clients (or prospects) need to ask themselves three important questions. Do they have the three “T’s”?

  • Time
  • Talent
  • Temperament
  • Time

    Researching the different online platforms takes a lot of time. Creating a financial plan takes a lot of time. Do your clients want to add these items to their already full-plate of jobs, home projects and family time?


    Your client may be extremely comfortable with technology and that works well for simple routine banking transactions such as deposits, balance inquiries and bill pay. But for more complex situations, they may prefer the human touch of an advisor because they can draw from their professional insight gained after years of industry experience.

    John Hancock’s 2015 Financial Stress Survey reveals that of the 2,000 people surveyed, 70% of those who work with a financial advisor are on track or ahead in saving for retirement, versus 33% of those not working with an advisor.


    We all have biases and when it comes to our finances, our emotions can get the best of us. Certain clients have a personality that looks at extreme volatility of the market as opportunities to buy. But could they be overconfident and make some big mistakes? Other clients are frightened of the market, especially if they are near or in retirement. What online advice could they use to prevent them from de-railing their plan in a moment of emotional stress? The personal touch of a financial advisor helps with the behavioral management of the client.

    People like options. Over the years there has certainly been no shortage of financial professionals. Perhaps robo-advising is just an expansion of our choices in the financial services industry: online, online with some personal advice and complete customized personal advice. So fear not the robo-advisor. You want clients that choose you for the three T’s.