Artificial intelligence (AI) is reshaping the wealth management industry as firms increase technology spending and explore new applications. According to Financial Planning, while AI holds promise for enhancing efficiency and client engagement, financial advisors continue to debate how best to integrate the technology without sacrificing ethical and regulatory standards.
Growing Investment in AI
A recent survey by Financial Planning found that 67 percent of industry experts expect to increase their technology budgets in 2024, with AI being a key focus. About 87 percent of respondents believe AI will have a positive impact on the industry, particularly in marketing, client onboarding, investment strategies, and lead generation. Robo-advisors, such as those offered by Betterment and Wealthfront, are considering AI-driven enhancements to their platforms. However, traditional advisory firms primarily use AI for back-office operations rather than direct client interactions.
Financial Planning also reports that LPL Financial has emerged as a leader in AI adoption, investing approximately $500 million in technology and infrastructure improvements last year. This included the introduction of AI Advisor Solutions, a suite of AI-powered tools for its network of over 23,000 financial advisors.
Compliance and Governance Challenges
Despite the enthusiasm surrounding AI, financial firms face challenges in governance and compliance. A survey conducted by ACA Group, ACA Aponix, and the National Society of Compliance Professionals found that only 12 percent of compliance leaders have established AI risk management frameworks.
Similarly, Smarsh's 2025 Communications Compliance Survey revealed that while 79 percent of financial services firms view AI as a top priority, only 32 percent have implemented oversight programs. Firms recognize the need for clearer AI policies and employee training. According to Era Jain, CEO of Zeplyn, registered investment advisor (RIA) firms are working to formalize AI usage guidelines and educate staff on both the benefits and risks of AI adoption.
The Debate Over AI's Impact on Financial Advisors
According to Financial Planning, industry professionals remain divided on AI's long-term impact. A Kaplan Schweser survey of CFA candidates and charter holders found that more than two-thirds believe AI will enhance their roles. However, 25 percent remain uncertain, citing concerns over job displacement and AI's influence on passive investment management.
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