HNW investors turn to AI but remain loyal to advisers

High-net-worth Australians are increasingly turning to artificial intelligence (AI) to manage their finances, but most remain reluctant to replace their financial adviser with the technology, new research from Praemium and CoreData has found.

Around 80% of HNW investors who work with an adviser have already used AI for financial tasks, including financial education, comparing investment strategies and sense checking advice.

However, only 29% said they would manage their portfolio themselves if given access to the same tools as their adviser, while roughly seven in 10 would still prefer to retain their adviser's guidance.

The research also found 86% believe the human adviser-client relationship will remain important in an AI enabled future, with most favouring a model that combines human advice with AI support rather than full automation.

Praemium chief strategy officer Denis Orrock said the findings' showed AI was changing client expectations rather than replacing the need for advice.

"The story here isn't AI versus advisers, it's AI with advisers," Orrock said.

"Clients are using these tools to become more informed and more engaged, and they're arriving with higher expectations of what their adviser should deliver."

The research suggests personalisation is becoming a more important measure of advice value, with 47% of HNW investors placing the greatest value on an adviser who understands how their finances fit into their broader life, ahead of investment returns as a standalone measure.

Nine in 10 respondents said their adviser helped build their financial literacy, while 88% said their adviser kept them accountable to their financial goals.

HNW investors also continued to see an important role for advisers in complex areas, including portfolio management, intergenerational wealth transfer and investment selection.

Orrock said the findings presented an opportunity for technology to reduce the administrative burden on advisers and create more time for higher-value client engagement.

"The advisers who thrive won't be the ones doing everything themselves. They'll be the ones who use technology to remove the work that doesn't require human judgement, so they can spend more time on the personalised engagement clients actually value," Orrock said.