By Michael Russo
There’s no doubt that AI is remarkable. It’s become too easy to rely on AI for simple tasks that don’t require human discernment. But make no mistake, artificial intelligence won’t replace financial advice or the services provided by a human advisor.
Sure, AI and robo-advice can do the thinking for you when it comes to simple financial matters. But when you need guidance on a complicated financial circumstance or an unforeseen economic development, that’s when you need the knowledge and experience that can only come from a trusted financial advisor.
There are several advantages to working with a financial advisor over a robo-advisor. Let’s take a look at each reason.
Robo-Advice Is Only a Starting Point
Robo-advisors might be a good fit for beginners with straightforward finances. But while creating a basic, preliminary financial plan might be useful, as your finances get more complex (and they always do), advice from a human financial advisor is essential.
Human advisors typically have years of knowledge and experience in a wide variety of financial situations and are trained specifically to help clients pursue their money goals.
Not only is their experience vital, an integral part of their professional life is keeping up with the most recent, nuanced developments and trends in the finance industry. As a result, human financial advisors are equipped to develop and adjust your financial plan to align with increasing complexities, both in the market and in your life.
Human Emotion
Finance isn’t typically considered a touchy-feely subject. Questions about your financial situation can usually be answered with a simple “yes” or “no.”
But emotions are more deeply connected to finances than you might think. Significant aspects of your financial life are directly tied to how you feel.
You might be overcome with panic and stress during times of economic uncertainty. Or you might feel carefree and impulsive when things are going well for you financially. The result is that your emotions cloud your ability to make wise financial and investment decisions.
That’s where human financial advisors shine. They’re able to objectively guide you through financial decisions, offering the clarity that’s lacking when emotions would otherwise run the show.
Personalized Advice
A robo-advisor’s help is restricted to the clinical data you provide. It ingests cold facts like your investment amount and time horizon, utilizes lines of code to make a decision, and then spits out financial recommendations based on binary information.
A human financial advisor, on the other hand, takes a holistic approach to managing your money by considering your personal situation. They get to know you as a person, and not just the numbers you feed them.
Personally, working with clients allows me to learn about their motivations and fears as well as their goals and dreams for the future. I work to strengthen our bond as time goes on and their situation and perspective shifts.
Additionally, my long-term client relationships are based on mutual understanding and trust, not cold data and algorithm-based financial recommendations.
Robo-Advisors Assume Rational Human Behavior
Even with the best of intentions, none of us is perfect and we can’t always behave as predictably as robots expect us to. A robo-advisor always assumes that you behave rationally when it comes to managing your money.
But we’re human. And sometimes humans make financial decisions based on impulse instead of rational judgment. There could be an unforeseen event, a family obligation, or a romantic gesture that drives a financial decision.
My experience tells me that there has to be an element of elasticity built into every financial plan—which robo-advisors aren’t able to do.
Reach Out to a Human Financial Advisor
When you need more than automated financial guidance, it’s time to work with a human financial advisor.
At Millstone Financial Group, our advisors get to know you on a deeper level, so you’re more than a managed portfolio, you’re family. Whether you’re looking for retirement planning recommendations, legacy guidance, investment management, or tax-minimization strategies, we’ll develop a personalized plan just for you.
When you’re ready to work with a financial advisor who looks beyond the numbers, schedule a complimentary consultation by calling (732) 385-8544 or emailing [email protected].
About Mike
Michael Russo is Chief Investment Officer at Millstone Financial Group, an independent financial advisory firm helping pre-retirees and retirees pursue their retirement goals. He has 30 years of industry experience and strives to help his clients understand investments and make sure every client is presented with sound investment management philosophies and retirement distribution strategies to help reduce the chances of running out of money in retirement. Mike graduated from Montclair State University with a degree in Business Administration, majoring in Finance. He spent over 10 years working for Brown Brothers Harriman and MetLife. While working for a local financial consulting firm, Mike met Donald Albach, and together they founded Millstone Financial Group to help people navigate the complexities of planning for retirement. Mike was raised in a modest household, where family always came first. He attributes his success to both of his hardworking parents, who instilled in him core values and integrity. Mike has been married to his wife, Maryann, since 1992. They reside in Howell with their three children, Matt, Craig, and Kellie. Mike is an avid sports fan and golfer. He is also a member of Battleground Country Club and enjoys being out on the course or having dinner with good friends and clients. To learn more about Mike, connect with him on LinkedIn.
Advisory services are offered through Millstone Financial Group Limited Liability Company, a Registered Investment Advisor in the State of New Jersey. Insurance products and services are offered through Millstone Financial Group Limited Liability Company.
All material discussed is for informational purposes only. Opinions expressed are solely those of Millstone Financial Group Limited Liability Company and staff. All topics covered are believed to be from reliable sources; however, Millstone Financial Group Limited Liability Company makes no representations as to its accuracy or completeness. Investing involves risk including the loss of principle.
This article shall in no way be construed as a solicitation to sell securities or investment advisory services to residents of any state other than New Jersey, or where otherwise permitted. All information and ideas should be discussed in detail with your individual adviser prior to implementation.
This material is intended to provide general financial education and is not written or intended as tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.
