Are we ready for the robot revolution?
As financial education increasingly rises up the HR agenda, many of my clients are interested in the idea of being able to provide robo-advice products to their staff to help them with their financial goals and retirement planning.
A consultation into how this type of financial advice could work was launched jointly by the Treasury and the FCA at the end of last year, including a review of the role robo-advice could play in solving problems around accessing advice. Employees need more financial help than ever before, yet financial advisers remain out of reach for the majority.
Robo-advisers have been around for a while in the US and are currently stirring up a positive storm in China. Services are increasingly being launched in the UK too. However the tools, platforms and modellers that are currently around in the UK require the user to input personal data and answer a series of generic questions – thereby raising a question of accuracy from the user and potentially increasing the risk of overlooking individual circumstances.
Many of the tools are also designed to supplement face-to-face advice, rather than replace it altogether, and only provide high level generic guidance. So can robo-advice really plug the advice gap in the UK?
Employees are looking for more support around managing money now and planning for the future. Clearly there are benefits to having robo-advice (instant access to advice and options). However, in the UK we are probably a few years off having a robot revolution which can truly help individuals with their money matters.
Currently employers should be focusing on providing employees with the right information and education when it comes to retirement planning. Where employers are looking to educate their employees about savings and pensions a combination of human and technology strategy should be considered.
Perhaps in a couple of generations, once we have a financially educated and savvy nation who are not snowed under by debt (as the government still ponders over whether financial education should be on the national curriculum), such tools will be helpful.
This article was supplied by LCP.
