Beyond Algorithms: Choose the Human Touch in Financial Advice
By Marjorie L. Rand, CPA, CFP®, RICP®
The progress made in artificial intelligence (AI) is both impressive and exciting. AI is allowing us to rethink how we integrate information, analyze data, and use the resulting insights to improve our decision-making. It is quickly transforming every walk of life. But it’s important to recognize that even with advanced technology, a human touch is irreplaceable.
This holds particularly true when it comes to your finances. The value of a trusted financial advisor’s personal touch will always surpass that of any software. Read the following key advantages to consider when deciding who (or what) should manage your money.
Expertise
Robo-advisors are helpful when you’re just starting your financial journey and have smaller balances to manage. Since there are often fewer fees with a robo-advisor, it’s a good fit for beginners. However, if you’ve been letting your robo-advisor run the show for a few years while your finances have grown and become more complex, it might be time to upgrade to a human financial advisor.
These are certified professionals with years of expertise in a wide variety of financial situations. Financial advisors are trained to help clients manage their finances and pursue their money goals. They stay up to date on the latest financial news and trends, which can help you receive the most current and relevant advice. No matter what’s happening in the markets or in your accounts, your financial advisor is equipped to develop the plan you need to pursue your financial goals with confidence.
Personalized Advice
The help of a robo-advisor is limited to its algorithm or the lines of code it uses to make decisions; and it only makes decisions with the basic information you provide. Data such as your risk tolerance, investment amount, and time horizon are used to calculate the best investments for you. Again, great for beginners.
When life gets more complex, you need financial advice that’s customized to your specific situation. A financial advisor takes a holistic approach to managing your money by reviewing your situation in greater detail. They get to know you, not just the numbers. They help you identify areas of improvement and find ways to solve your biggest financial issues.
A financial advisor is there to help you lay out a plan toward your financial goals too. A human advisor might help you strategize how you can retire early, how to expand your small business, or how to pay for your child’s college tuition.
Emotional Support
Finances are usually seen as a more logical topic, but emotions are deeply connected to your financial situation in ways you might not have considered. During times of economic uncertainty, you might feel scared, stressed, or concerned. When things are going extremely well, you might feel overjoyed, carefree, or impulsive. These emotions affect your ability to make wise financial and investment decisions.
A trustworthy human financial advisor guides you through those decisions with greater clarity. Instead of letting your emotions run the show, advisors look at your situation objectively to help you make an informed decision even in challenging moments.
Accountability
If you’ve had trouble sticking to your financial plan before, a financial advisor could provide the accountability you need. Financial advisors and planners can help you create a budget, track your expenses, and monitor your progress toward your financial goals.
They’ll also help you keep those end goals in mind when you consider the other financial decisions you want to make. If your goal is to buy a home, your financial advisor might remind you of that when you want to purchase a new Rolex.
We Care About Our Clients
As AI technology continues to advance, it holds immense potential to revolutionize many industries through its analytics. But it’s important to acknowledge its limitations so it won’t hinder your vision for an ideal future. Technology can never replace working with a financial advisor who knows you and whom you can trust. Logarithms can be skewed to benefit a brokerage firm without you ever knowing it but I am always committed to putting my clients’ best interests first. Working with a financial planner who knows you and cares about you remains the best way to create confidence in your financial plan.
At Rand Financial Planning, we are committed to providing a personalized and relational experience, leveraging both education and knowledge. Schedule a 20-minute introductory call or reach out to me at 908-895-2406 or marge@randfinancialplanning.com to see if I’m the right fit to help you on your financial journey.