Why Human Advisor is far better than Robo Advisor?
Many investors believe that the level of advice and services offered by human advisors is on par with Robo advisors. As 69% of million investors believe a human advisor would be the better choice to create a financial plan, 24% think a Robo advisor could do the job as well. And only 7% believes a Robo advisor could do a better job according to the surveys.
Robo advisors are automated online services that ask you a set of questions about your personal financial goals and preferences, and then provide you with investment advice and access based on your answers. Robo advisors manage portfolios automatically, with the decisions driven by software. Moreover, these are advisors like wireless phone company, telephone prompts are communications consultants.
Artificial intelligence based on historical pattern recognition is already pervasive throughout our society. Take Waze or Google Maps, most of the time we need only three or four letters and the system knows exactly where we want to go. Likewise, computers are great at processing rules based on algorithms. However, there are still some things that require the kind of vision, sensibility and insight that only a human being can offer.
Direct human contact is very important to you!
If you prefer having direct human interaction regarding your investments, you are best stay with the traditional investment advisors. Not all investors are ready to replace human interaction with algorithms.
Money is emotional and relationships matter.
Money is and always been, emotional. When someone dies, sells a business or gets divorced, turning to the robot doesn’t have much appeal. Real people want human interaction along with a personalized, customized investment plan. Not to mention a fiduciary relationship that a robot cannot offer.
The Robo advisors typically allow you some form of phone access, but there is no one at the platform that actually has primary responsibility for, and knowledge of managing your portfolio.
Well Robo advisors can work very well in a lot of situations; however, since everyone’s situations and temperaments are different, you still need to weigh the options of whether a traditional investment advisor will work better for you and investing style.
Aaron Klein, CEO and co-founder of Riskalyze, he explains why human financial advisors are better than Robo advisors. In 75 minutes podcast session of Aaron Klein, everything is well discussed when and why human financial advisor is far better than robotic machines. Well, listen to his podcasts and for further queries, feel free to get hooked with him.