Artificial Intelligence and the Future of Wealth Management in 2024 and Beyond

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This past year will be remembered for many things: geopolitical unrest, high interest rates and inflation, the coronation of Charles III, Barbenheimer … And let’s not forget Artificial Intelligence. While the technology was not introduced in 2023, it was democratized to the point of being on everyone’s lips. And like pineapple on pizza, people have very strong feelings on the topic.

With good cause.

AI offers both the potential for great progress and great peril across all industries. In the wealth management space, it has been in use for years, helping to increase efficiencies in areas from compliance to data analytics. The advancements in AI that had been incremental, are now being introduced at lightning speed, raising concerns from within the tech establishment and beyond.

What does AI portend for wealth management? Digital Wealth News consulted three wealth management leaders to provide their informed perspective on AI and its place in the industry:

Darren Connor, Chief Operating Officer, PensionPro, an AmericanTCS Company, providing workflow management software to the retirement industry

Brian K. Bunker, Senior Director, Head of Practice Management & Consulting, Stratos Wealth Partners, an SEC Registered Investment Advisor and part of Stratos Wealth Holdings, a family of companies focused on supporting the growth and success of financial advisors across business models and affiliation structures

Sindhu Joseph, CEO and Co-Founder, CogniCor, a leading provider of AI-enabled digital assistants and business automation platforms for the financial services industry


Digital Wealth News: What are the advancements in the pensions and retirement space that have been aided by AI? Are there still challenges that can be solved by AI?

Darren Connor, Chief Operating Officer at PensionPro: Artificial intelligence for businesses is not new, but when ChatGPT launched in November 2022, it gave the public and industry a better understanding of how AI could work. As a provider of technology solutions for pensions and retirement management, we know how AI can streamline and automate tasks that previously required manual data gathering. For example, acquiring, collating, and delivering quarterly statements to plan sponsors is now automated with near 100% accuracy. In addition, AI-enabled CRM systems can deliver a more personalized client experience by providing relevant data almost instantaneously. I believe we will continue to see advancements and efficiencies in the retirement space as we continue to discover ways AI can reduce time and human error.

Digital Wealth News: Even with the major advancements across the AI industry this year, it seems we are a long way from integration of AI into the wealth management space. What do you believe needs to happen to take that next step in 2024?

Brian K. Bunker, Senior Director, Head of Practice Management & Consulting at Stratos Wealth Partners: As the operational needs of advisors shift and the demands of clients increase, it feels like there is less time in the day to do more. But this isn’t really a new issue and frankly it has driven tech and operational innovation for generations.

To get the most from AI-enabled solutions, we must ask and answer: How should AI change the wealth management space?

If we want AI tools to allow financial advisors to put their practices on autopilot, this shift is likely to be a failure and a massive disservice to clients. However, if AI is used as a tool to automate more manual aspects of the business, providing capacity and scalability to an advisor’s businesses – as it is in most available applications on the market today – it will likely result in significant growth for those applying these tools.

Wealth management remains a relationship-based business so understanding why an advisor would want to use this kind of tech will be important. The humanity of this industry can’t ever be completely replicated by technology. And I believe keeping this at the core of how we answer these important questions will help driver further application and integration of AI.

Digital Wealth News: This year saw incredible advancements in AI technology, application and acceptance within the wealth management space. In your opinion, what was the most important step forward and what should we expect in 2024?

Sindhu Joseph, CEO and Co-Founder at CogniCor: The success of ChatGPT changed the landscape of the industry. Concepts of large language models (LLM) and other AI solutions aren’t storylines in Sci-Fi movies or university research projects anymore. The exposure to the use cases and the education through media made possible by ChatGPT represented the most important advancements in this field in years. From news coverage to late night talk show jokes, everyone was talking about AI, which will drive adoption rates.

At CogniCor, we have been advocating for the use of this kind of technology for years and many of our clients are now far ahead of the curve. And while many advisors believe these solutions are still years off, several large IBD and top RIAs have rolled out LLM-based solutions to their employees and advisors using our technology. These early adopters sought out providers that have done the work to create solutions within the regulatory framework and operational environments of wealth management industry. Firms that do so will be at an advantage in the years to come.

In 2024, I expect to see mass scale proof-of-concept pilot programs across the industry, and a nearly immediate demand from advisors at leading RIAs and larger wealth management organizations for these tools.

Firms should work to empower advisors with AI-enabled solutions now. The longer they wait to implement these tools, the further behind they get as the advancements we’ve seen in recent years will likely accelerate. Frankly, firms don’t have time to fix everything else wrong with their tech stacks if they want to compete for leading advisors. The demand from advisors is clear – they want these tools to build their businesses and they will move to get what they want.

The future of AI is now

As AI becomes even more prevalent in the wealth management industry and its benefits become clearer, concerns about its risks will abate. The efficiencies AI creates will grow exponentially over time as improvements are made to the technology itself and how it’s delivered. With a demonstrated history of embracing innovation in service to clients, financial advisors will leverage the time savings AI delivers to focus on relationship building and personal support of clients. AI represents an evolution in capabilities that will strengthen the advisor/client bond – not replace it.