Advisors looking to build ties with younger affluent investors might want to consider brushing up on their AI skills, according to a new survey.
The poll from Boosted.ai, a generative AI software firm that caters to investment managers, looked into how high-net-worth investors across the US and Canada – those with $100k+ personal income, $300k+ household income, and/or $1 million-plus in liquid investable assets – use and view artificial intelligence.
It revealed that younger HNW individuals are increasingly relying on AI in their personal lives and expect their financial advisors to do the same.
According to the findings, 82 percent of younger HNW respondents describe themselves as proficient in AI, and 56 percent report using the technology regularly. Additionally, 79 percent expressed that they would like their financial advisors to integrate AI tools into their services.
AI usage could be a make-or-break issue for relationships with younger HNW clients. Among those in the survey, 35 percent said they'd consider walking away from their current advisor they weren't already adopting AI. Beyond that, 70 percent of respondents aged 18 to 44 view the use of AI and emerging technologies as essential for financial advisors.
“Gen Z and Millennials understand the transformational nature of AI and how it will impact their lives, including their finances," Joshua Pantony, CEO of Boosted.ai said in a statement. "They’re becoming more comfortable using it, and clearly expect the people they trust with their investments to leverage the technology as well.”
With an $84 trillion wealth tsunami from Baby Boomers to younger generations set to take place over the coming decades, Pantony argued that advisors must evolve their approach to meet the needs of a more tech-savvy clientele.
While the survey highlights a growing enthusiasm for AI among younger investors, it also reveals concerns about the technology. Issues such as personal data security (68 percent), lack of regulation (67 percent), and hacking (62 percent) were cited as primary concerns across all age groups.
The results also revealed a schism in AI trust across age groups, with only 30 percent of those aged 65-74 expressing trust in AI, compared to 63 percent of younger respondents.
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