When Uber and Lyft invaded the taxi industry, Turbotax disrupted the tax industry, and Amazon disrupted retail, delivery, and many other industries, many denied their risk.
The robots are coming for financial advisors. We should try to manage risk, even embrace it. Disruption will happen, but it is survivable for those who adapt. The personal touch is what taxi drivers and tax advisors claimed would save them. It helps, but don’t feel safe.
How do we survive the robots? With some teamwork. There are many calls for regulating the industry so robot advisors cannot enter. A more promising approach is to join resources and offer better service. Back when John Bogle first created index funds, there were many questions about his sanity. Today, they are ubiquitous. Rest in peace, sir.
You may be wondering what heartless fools would dare challenge the great american way of investment advice. Let me tell you how a computer programmer thinks. Once the word “computer” referred to a profession. Now, it has been automated, and the job of doing the automation is mine, a computer programmer. It’s nothing personal, but when a job can be automated, programmers have the job of doing so. Automating people’s jobs away is what justifies a programmer’s salary.
Here is the point: we can band together and use the knowledge we have of markets and investments to keep financial advisors employed, or be buried under a wave of investment engines that are better than humans.
True, the public is not beating down the doors to get to robot investing – yet. However, the trends are clear. In 2008 there was a surge, then a retreat, but that’s how trends usually go before they overtake a profession. Look how online sales died before Amazon became king.
My proposal is to work together to gather data and develop AI algorithms that can be sold to individuals from current financial advisors.
If you believe in such a vision, contact me, and we can together work towards a better future for all.
This isn’t just a wish, here is my specific plan.