Where’s Wealth Management Going with this Whole AI Thing?

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Advisors already use artificial intelligence to draft emails, prepare for client meetings and organize documents. But that’s just scratching the surface of what the tech can do in financial planning, according to industry executives at a Goldman Sachs event this week. The technology is rapidly evolving beyond back-office support, and could fundamentally reshape how wealth management firms hire, scale and communicate. In a world increasingly shaped by AI systems, advisors are also going to have to lean into their emotional intelligence, said Larry Restieri, CEO of Hightower Advisors.

“We used to live in a world where an advisor was a stock-picker,” he said. “The rep-as-PM model is dead.”

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Age of Avatars

Just last month, Citi released its AI client assistant, Sky, and it’s certainly not going to be the last of its kind. “We’re going to eventually have hundreds of digital employees,” said Shirl Penney, Dynasty Financial Partners founder. Dynasty is a few months away from launching a virtual version of Penney that introduces wealth managers to the company and explains the independent advisor model. “Virtual Shirl has already reviewed the last five years of my emails, read hundreds of my speeches and white papers, understands my voice and cadence,” he said. “I think it will be a mass accelerator to get people educated about Dynasty on the front end.”

Penney said Dynasty’s other avatar, Archie, is currently in beta form and will provide clients with market commentary, as opposed to advisors having to call each of their clients to give them updates. “It’s scaled communication,” he said.

The Hiring Question? Most wealth managers don’t think AI is going to replace human advisors. But what about junior advisors who’ve traditionally handled many of the tasks that AI systems are now taking over?

Firms that aren’t hiring from campuses and training new advisors are making a mistake because it’s those younger professionals who are leading AI innovation, said George Lee, co-head of Goldman Sachs Global Institute.

“Over time, the far more exposed population are middle managers,” he said.

AI won’t necessarily make jobs obsolete, but it will change hiring dynamics. “It doesn’t mean we fire people,” said Rob Sechan, CEO at NewEdge Wealth. “It probably means we hire more slowly because the productivity that comes from leveraging these tools is critically important.” Sechan added that firm leaders need to be encouraging AI use. “I think there’s some embarrassment when you see the [em] dash in an email,” he said. I want to see the [em] dash. I don’t care. Don’t be embarrassed. Be embarrassed if you’re not using it.”

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