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Advisors are inundated with the benefits of becoming more tech-savvy. Whether it’s leveraging social media to better connect with younger prospects or using technology increase back-office efficiencies, there is merit in embracing tech. Not just merit. It’s a necessity.
However, there’s a tech dichotomy emerging. Undoubtedly, technological progress in some forms is a boon for advisors and investors, but a balancing act needs to occur between tech integration and emphasis on the value of human guidance and advice. Fortunately for advisors, for as much as technology advances, clients still want the human touch, indicating they like technology but they’re only willing to go so far in terms of trusting it to manage their money.
Take the case of artificial intelligence (AI). Thanks to daily headlines exploring the investment these and ballyhooed stocks such as Nvidia (NASDAQ: NVDA), clients are enamored by AI and many are using tools such as ChatGPT for financial research purposes. However – and this good news for advisors and investors alike – many retail market participants don’t trust AI as a primary source of financial advice.
Advisors, Tech Can Be Potent Combination
Knowing that today’s clients are increasingly tech-proficient and that they still want human connection with fiduciaries, advisors shouldn’t view AI and tech more broadly as threats, but as complements to their overall business strategy. Betterment’s 2025 Retail Investor Survey confirms as much.
“Rather than replacing financial advisors, digital tools are complementing professional guidance. Investors using digital platforms are nearly twice as likely to also work with a financial advisor (62% vs. 34% of non-users), indicating that investors today are seeking both the accessibility of technology and the personalized insight and assurance that human expertise can provide,” according to the survey.
Underscoring the value of advisors, the Betterment survey indicates those polled that are working with wealth managers are more confident and satisfied. Fifty-four percent of those queried by Betterment possessing positive financial outlooks work with advisors and they cite factors such as reduced stress and better planning as reasons for that confidence.
Respondents’ feelings about the macroeconomic also highlight the benefits of having a relationship with a human advisor. Put simply, geopolitical turmoil, inflation and tariffs are contributing to investor angst.
“Optimism has declined to 48% (from 60% last year) amid concerns about inflation (58%), political uncertainty (41%) and recession risks (41%),” adds Betterment.
Younger Demographics Showing Some Mettle
Millennials and Gen Z have interesting reputations, but some facts are empirical, including their technological capabilities and their enthusiasm for investing. That’s an attractive combination for advisors as is the point that those generations are showing surprising levels of confidence and resilience against a challenging macroeconomic backdrop.
“Gen Z (67%) and Millennials (53%) are significantly more confident than older generations, suggesting that having a longer time-horizon and more tools at their disposal provides a buffer against short-term market uncertainty,” observes Betterment.
Bottom line: many Gen Zers and millennials may not yet have the big asset levels advisors crave, but these prospects are more pragmatic than previously believed, they desire increased levels of investment education and they’re willing to take the long view.
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