The Role of AI in Revolutionising Financial Consulting 

In the dynamic world of financial consulting, the integration of Artificial Intelligence (AI) is not just a futuristic concept; it’s a present-day reality that’s reshaping how financial advice is delivered.  AI tools have become increasingly sophisticated, offering the potential to revolutionise the financial consultancy landscape – by Alex Clansey

 
Many firms in the financial services arena are already beginning to embrace it. In a recent survey of Chartered Financial Analyst (CFA) Institute members, over half of respondents (56%) indicated that their companies regularly employ AI and ‘big data’ solutions for data analysis, while just over a quarter (26%) reported that their firms utilise these technologies to inform decision-making processes. 

AI’s emergence in this field presents a unique set of opportunities and challenges. Notably, it raises the question about trust and the authenticity of automated advice, challenges that are central to the evolving role of financial advisers who are guiding entrepreneurs and startups. This technological shift, however, can also open new avenues that promise a significant transformation in the financial services landscape. 
 

AI: A tool for enhanced financial planning

 
By leveraging AI, financial advisers can drastically improve the efficiency, accuracy, and depth of their advice. AI can process vast amounts of financial data quickly and accurately, enabling financial advisers to make data-driven decisions and uncover valuable insights. This can lead to more informed investment strategies and risk assessments. 

A recent CoreData study involving 267 UK financial advisers revealed several key benefits of AI in financial advising. Around 45% of advisers see AI as a tool to enhance client service efficiency, and 31% believe it could lead to reduced advice fees.  

Crucially, AI can also help advisers build engagement with their clients. On one level, AI algorithms can analyse a client’s financial history, goals, and risk tolerance to generate personalised investment recommendations. This level of personalisation can help advisers tailor their advice to individual client needs and preferences. AI can also help enhance client engagement through chatbots, virtual assistants, and personalised communication. These tools can answer client queries, provide regular updates, and foster stronger client-advisor relationships.  

Another way financial advisers and consultants build engagement with their clients is by developing business plans for them, a service that now regularly makes use of the latest AI technology and tools.  

Traditional methods of creating business plans can be time-consuming and daunting, for both businesspeople and financial advisers who support the creation process. However, recent advancements in AI planning tools have made it possible to develop comprehensive business plans in a much shorter timescale than the weeks, or even months, that are traditionally required. It is an approach that businesspeople are increasingly coming on board with.  

In a recent Venture Planner-commissioned survey, polling 2,000 people across the UK who had previously considered starting their own business, 66% of respondents did not know that AI tools to help generate a business plan even existed. Despite this, 78% said they would consider using these tools to create a business plan. 

Over half of respondents (55%) also outlined that they feel they need help with financial forecasting – something AI-driven planning tools can provide support with. The findings underline both the potential of AI to be used for this kind of application, as well as the role that financial advisers can play in educating their clients about its benefits. 
 

The Trust Factor: Balancing automation with authenticity

 
Despite the advantages, the rise of AI in financial consulting raises concerns regarding trust and authenticity. In the CoreData survey, over 42% of respondents said they worry about potential risks related to client confidentiality and data protection, and 35% express distrust in AI-generated information.  

There is a delicate balance between embracing technological advances and maintaining the personal touch and trust that is the hallmark of successful financial consulting. Navigating this new landscape requires a thorough understanding of AI’s capabilities and limitations, and how to integrate it effectively into the consultancy toolkit. 
 

The future of AI in financial consulting

 
Looking ahead, the integration of AI in financial consulting is not just about technology; it’s about how it can be leveraged to empower advisers and clients alike. The future of financial consulting lies in finding the perfect synergy between AI’s analytical prowess and the irreplaceable human elements of empathy, understanding, and trust. 

As the field continues to evolve, the role of AI in financial consulting will undoubtedly expand, offering new ways to enhance the quality and accessibility of financial advice. The challenge for both advisers and clients will be to embrace this change, recognising the transformative potential of AI while maintaining the core values that define the essence of financial consulting. 
 
Alex Clansey is co-founder, Venture Planner