Robo-Advisers: Should a Robot Be Planning My Future?

robo-adviser

A hot topic among my financial planner friends these days is whether we will all be unemployed by the advent of robo-advisers.  Will machines take over financial planning where humans were once needed?

Is all technology an advancement?

 

Like all technology disruptions (Uber to taxis, Amazon to physical stores, Microsoft Word to steno pools), financial services can be made more efficient and cost-effective using technology.  However, we still need people (Uber drivers, Amazon customer support and package fulfillment, Executive Assistants instead of dictation-takers) to help us across the finish line.

What is a robo-adviser?

 

Here is a handy definition from Wikipedia:

 

Robo-advisors are a class of financial adviser that provide financial advice or portfolio management online with minimal human intervention. They provide digital financial advice based on mathematical rules or algorithms.

 

Where does this fit into your financial planning?  Well, if you like using technology, but hate making investment decisions, the use of a robo-advisor may be right up your alley.  Also, some platforms come with financial planning features that help you track spending and arrive at savings goals.

There might just be a solution.

 

I’ve found, though, that when it comes to making important decisions – especially about money – people still prefer an experienced person to help them talk through the variables they are considering.  The great news is there is room for both.  You can use a robo-adviser for investment help and a human financial planner for life/money problem solving.  They don’t have to be mutually exclusive.

 

So, just like I don’t have to choose between buying a Lick-em Cat Scratcher on Amazon OR going to Target to mindlessly spend $100, you don’t have to have only a robo-adviser or only a human helping out with your finances.  You can use both!

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