{"id":50,"date":"2019-03-13T13:53:27","date_gmt":"2019-03-13T13:53:27","guid":{"rendered":"http:\/\/sites.oechsli.com\/gabridgecodemo\/?p=50"},"modified":"2019-04-29T13:13:43","modified_gmt":"2019-04-29T13:13:43","slug":"3-reasons-why-robots-wont-replace-financial-advisors","status":"publish","type":"post","link":"https:\/\/www.gabridgeco.com\/2019\/03\/13\/3-reasons-why-robots-wont-replace-financial-advisors\/","title":{"rendered":"3 Reasons Why Robots Won\u2019t Replace Financial Advisors"},"content":{"rendered":"

Robo-advisors have been heralded as the \u201cfuture of investing\u201d by their fans, but can computer algorithms really replace human financial advisors?<\/p>\n

Robo-advisors are less expensive than traditional advisors\u2014but their low, up-front price comes with a loss in quality. Robo-advisors lack an irreplaceable human element, which prevents them from providing the essential qualities and services characteristic of traditional financial advisors. When you look more closely at the differences between the two, it seems obvious that robo-advisors could never truly replace human financial advisors.<\/p>\n

How do robo-advisors work?<\/strong><\/p>\n

Robo-advisors are low-cost, digital platforms that use automated algorithms to provide investment advice. Investors fill out an online form detailing their current financial situation, monetary goals, and investing preferences. Then, the robo-advisor software analyzes the responses and dispenses investment advice.<\/p>\n

A recent study by LendEDU<\/a> found that Millennials, once believed to be the biggest proponents of robo-advisors, actually chose human advisors nearly two-to-one over automated investment services. Other findings from the study revealed that 52% of Millennials believed that robo-advisors are more likely to make mistakes, and nearly 70% thought a human advisor would get a better return on their investments.<\/p>\n

Here are 3 reasons why human financial advisors provide more value than robo-advisors.<\/p>\n

    \n
  1. Money is an Emotional Matter<\/strong><\/li>\n<\/ol>\n

    When you compare a robo-advisor to a human financial advisor, the key difference is a human advisor\u2019s ability to offer emotional guidance<\/em>. Meeting our clients face-to-face allows us to provide behavioral coaching and hand holding, helping clients develop positive budgeting and wealth management habits that lead to long-term financial security. When markets decline or experience an upset, we work with our clients to help them make rational financial decisions and overcome detrimental emotions or impulses<\/em>.<\/p>\n

      \n
    1. Everyone has a Unique Financial Situation<\/strong><\/li>\n<\/ol>\n

      Human financial advisors provide personalized counseling and guidance to help clients achieve long-term financial success. Automated online platforms are unable to match this level of personalization. Instead, robo-advisors rely solely on computerized algorithms to determine asset allocation. While traditional financial advisors may use similar strategies, we also rely on our professional history, as we have worked with a variety of clients with unique financial situations. Additionally, we may work with a team or have additional financial tools at our disposal to determine the best investment objectives for each client.<\/p>\n

        \n
      1. It\u2019s About More Than Just Investments <\/strong><\/li>\n<\/ol>\n

        Investment advice is just a small part of a complete financial plan. The most sophisticated robo-advisors may offer automatic portfolio rebalancing and tax-loss harvesting, but they don\u2019t come close to providing the full range of services that human financial advisors offer. As people move through life, their priorities and financial goals evolve. Human financial advisors are able to create nuanced investment strategies that take into account changing life circumstances. We provide comprehensive financial planning that includes retirement, insurance, and estate planning services, the best exercise of stock options, cash flow monitoring, and more to help our clients achieve their financial aspirations.<\/p>\n

        While robo-advisors are gaining more capabilities and media attention, they aren\u2019t close to replacing human financial advisors. Robo-advisors may be useful for beginner investors with limited assets, but they lack the full range of benefits that would let them serve as true replacements for traditional, human financial advisors. If your finances could benefit from a personal touch, please contact us for a complimentary consultation.<\/p>\n

        \u00a0<\/strong><\/p>\n

        Sources: <\/strong><\/p>\n

        Brown, Mike. (2018, Aug. 23) Robo Advisors vs. Financial Advisors \u2013 Millennials Still Prefer Real-Life. [Blog post]. Retrieved from https:\/\/lendedu.com\/blog\/robo-advisors-vs-financial-advisors\/<\/a><\/p>\n

        Rixse, Chad. (2018, Apr. 25) The 4 advantages of human vs. robo-advisors. [Blog post]. Retrieved from https:\/\/www.cnbc.com\/2018\/04\/25\/the-4-advantages-of-human-vs-robo-advisors.html<\/a><\/p>\n

        Wohlner, Roger. (2018) Is An Online Financial Advisor Right For You? [Blog post]. Retrieved from https:\/\/www.investopedia.com\/articles\/financial-advisors\/121914\/online-financial-advisor-right-you.asp<\/a><\/p>\n

        Investopedia. (2018) Robo-Advisor (Robo-Adviser). [Reference] Retrieved from https:\/\/www.investopedia.com\/terms\/r\/roboadvisor-roboadviser.asp<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

        Robo-advisors have been heralded as the \u201cfuture of investing\u201d by their fans, but can computer algorithms really replace human financial advisors? Robo-advisors are less expensive than traditional advisors\u2014but their low,…<\/p>\n","protected":false},"author":34,"featured_media":47,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"post_statement":"","post_description":"","post_cta":"","post_button":"Read More","post_button_url":"","footnotes":"","compliance_id":"","post_disclaimer":""},"categories":[1],"tags":[],"yoast_head":"\n3 Reasons Why Robots Won\u2019t Replace Financial Advisors - Gabridge and Co<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.gabridgeco.com\/2019\/03\/13\/3-reasons-why-robots-wont-replace-financial-advisors\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"3 Reasons Why Robots Won\u2019t Replace Financial Advisors - Gabridge and Co\" \/>\n<meta property=\"og:description\" content=\"Robo-advisors have been heralded as the \u201cfuture of investing\u201d by their fans, but can computer algorithms really replace human financial advisors? 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