Financial Planning Standards Board (FPSB) research released this month has found that globally two in three financial planners report their firm is using AI or planning to in the next 12 months.
However, 82% of Australian-based planners are either using AI or planning to in the next 12 months. The FAAA is not surprised at these results as it has been featuring sessions on how to integrate technology and AI into businesses as part of the agenda for both the 2024 and 2025 Roadshow series as well as at Congress 2024.
FAAA CEO, Sarah Abood, said those advisers using AI see it as a way to reduce costs and broaden access to underserviced communities, helping make financial advice more affordable and more widely available.
“One of the clearest messages we hear from our members is that overly complex regulation, while well meaning, has driven many advisers out of the profession, making financial advice more expensive and harder to access.
“We need to cut unnecessary red tape and ensure that advisers can focus on delivering great outcomes for their clients. The research shows that a number of practices see AI as a useful tool in helping them achieve this.”
The research drew on responses from more than 6,200 financial planners across 24 territories.
The research highlights that a third of Australian advice businesses (33 per cent) using AI are small businesses (2-10 planners), with less than one in ten (7 per cent) of businesses with 51-150 planners taking advantage of AI.
The main uses of AI for Australian financial advisers are client communication and engagement (29 per cent), collecting client information (22 per cent), and to a smaller extent, market analysis and investment (6 per cent).
Half of all Australian financial advisers surveyed (50 per cent) believe that AI will enhance the quality of financial advice, and 64 per cent believe it will reduce the cost of providing advice to clients.
- 62 per cent of Australian advisers believe AI will increase access to financial planning for under-served populations
- 52 per cent are concerned about data privacy and cybersecurity, with a further 32 per cent showing concerns about accuracy and reliability of AI outputs
- Only 39 per cent said their business had a policy or provided guidance on the use of AI.
The global research, which drew on responses of more than 6,200 advisers, also found:
- Improved client services: Over three quarters of financial planners (78%) believe AI will help them better serve clients, while 60% believe it will enhance the quality of financial advice.
- Widespread AI adoption: Of the two-thirds of firms that either have or are planning to leverage AI in the next 12 months, adoption rates are highest among small or very large firms. 50% of financial planners have a positive outlook on AI, while only 8% view it negatively.
- Lower cost and increased access: 59% of financial planners see AI as a tool to help reduce the cost of financial planning services and 60% believe it will increase access to financial planning for underserved populations.
- Usage of AI in financial planning: Almost half of financial planners using AI have deployed it to support delivery of client services such as client communications (41%), client data collection (33%), and client risk profiling (30%). One in three are using AI to improve operational efficiency, for example, in marketing and promotions (35%) and the client onboarding process (34%).
- Concerns with AI: Despite the benefits, financial planners expressed reservations regarding the use of AI, with 47% citing data privacy and cybersecurity concerns and 42% concerned about the accuracy and reliability of AI outputs.
- Need for professional development: To better adapt to AI, 49% of financial planners expressed a need for professional development to improve their data analysis and interpretation skills. Over a third (36%) believe both the public and the financial planning profession will greatly benefit from general education and training on AI.
AI and technology in real life
FAAA member, financial adviser and AI early adopter Peita Diamantidis started using technology as she began her business with a lot of C and D clients. “I had to find ways to do things more effectively,” she said.
Peita said today there are layers of AI and other technology that a lot of advisers currently ignore “at their peril”.
This includes using technology to perform menial, repetitive, dull tasks – like pulling together reports, data entry – the jobs that require practice but not assessments, she said. “File noting tools, costing a few hundred dollars a month, can save a day a week when used,” Peita said.
The next step is using context to have AI accessing all your information on a Google drive or from a Microsoft suite to build reports and deep relationships with clients.
From here advisers can harness AI to provide the ability for clients to self-serve and interact with your business even when you are not available.
About the FPSB's impact of AI on Financial Planning global research
This research was undertaken by FPSB and its global network of organisations to explore the current use and impact of AI in financial planning. It was conducted via an online survey of 6,206 financial planners between November – December 2024.
The respondents included CFP® professionals and other financial planners from 24 territories, including Australia, Austria, Brazil, Canada, China, Chinese Taipei, France, Germany, Hong Kong, India, Indonesia, Ireland, Italy, Japan, Malaysia, the Netherlands, New Zealand, Republic of Korea, Singapore, South Africa, Switzerland, Thailand, United Kingdom and United States.
For more information on findings from FPSB’s Impact of AI on Financial Planning global research, view the Report and Infographic.
