Adding a human touch to Robo Advisors

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Adding a human touch to Robo Advisors

Investors want digital tools and live guidance

People prefer a “bionic” financial advisor who offers a low-cost, automated investing platform paired with patient, personal advice, according to a recent survey by the Financial Planning Association and Investopedia.

Among people using automated investing services, known as robo-advisors, 73 percent were satisfied with their experience, the survey found. Meanwhile, 75 percent of people who primarily work with a financial advisor said they were pleased.

While people who used robo-advisors were generally satisfied, 40 percent of those surveyed said they were uncomfortable using the services during periods of extreme market volatility.

The Financial Planning Association and Investopedia surveyed 2,002 U.S. investors age 21 or older in August and September about their preferences for planning advice.

Topic Financial advisor Automated investing platform Both
Estate planning 52% 18% 30%
Elder care planning 49% 22% 29%
Tax planning 48% 20% 32%
Health care planning 44% 25% 31%
Finances related to getting married 43% 32% 25%
Finances related to buying a home 43% 28% 29%
Finances related to having children 42% 30% 28%
Investment planning 39% 22% 39%
Education funding 38% 33% 29%
Finances related to major purchases 36% 36% 28%

Other surveys have found that investors want to merge the benefits of low-cost, easy-to-use technology with the security of a human being.

One in 4 people with $500,000 or more in investable assets uses digital tools and a paid advisor, according to a recent survey by financial services research firm Hearts & Wallets.

“More investors are blending digital services and live advice,” said Laura Varas, Hearts & Wallets’ founder and CEO. “I think the reason behind it is that investors are evaluating their interactions with [financial services companies] based on their feelings and responses from people at the companies to see if they can trust them. And people trust humans more than machines.”