What is ChatGPT and will it replace advisers?

For full disclosure, ChatGPT is frighteningly good at my job. It can’t replace me just yet… but it’s only a matter of time before technology is able to replicate critical thinking and ask probing questions.

But how about financial advisers? Could ChatGPT, or a similar specimen of AI, really replicate advice by collecting data from the world wide web and personalising it for each individual seeking help?

Here’s what the AI had to say when asked “will ChatGPT take over the financial advice industry and make advisers redundant?”

It is possible that advanced language models like ChatGPT could play a larger role in the financial advice industry in the future. The technology is able to process large amounts of data and provide accurate and personalised advice to individuals seeking help with their finances. However, it’s important to note that financial advice is a complex field that requires expertise and experience. Human financial advisers bring to the table the ability to understand the nuances of individual financial situations and provide tailored advice accordingly. It’s also important to note that financial advice is not only about providing accurate information but also about building trust and providing a human touch.

Moreover, the use of language models like ChatGPT can be seen as a complement rather than a replacement to human financial advisers. It can help financial advisers with the data analysis and provide them with a better understanding of their clients’ needs, which can help them provide better advice.

In conclusion, while advanced language models like ChatGPT can play a role in the financial advice industry, it is unlikely that they will entirely replace human financial advisers. Financial advice is a complex field that requires expertise and experience, and human financial advisers are still the best option to provide the tailored advice that clients need.

Adele Martin agrees.

‘A lot of pros’

Speaking to ifa, the founder of My Money Buddy and the Savings Squad podcast said she sees potential in ChatGPT.

“It’s early days and still lots of errors especially as it only has data until 2020, but I definitely think it has a lot of pros,” Ms Martin said.

Some advisers, she told ifa, are already using the technology to draft their client emails.

“I think it has a lot of potential for simple/not complex advice — with advisers checking the advice or perhaps in time, consumers using it as a self-directed service,” Ms Martin added.

According to ChatGPT itself, the cut-off date for the version currently in use is 2021, which means that the model’s knowledge and understanding of events, facts, and information are current up to 2021.

But the tech is bound to get a lot more sophisticated following Microsoft’s announced multibillion-dollar investment. 

Referred to as a “game-changing investment”, this could see the AI behind ChatGPT deployed across a myriad of Microsoft products including Word and Outlook.

Bespoke, tailored advice to survive

Glen Hare, adviser and co-founder of Fox & Hare, told ifa that while he does believe there is space for AI in advice, there will always be space for personal, bespoke advice, delivered by a financial adviser.

"The reason I say that is there’s been a huge increase in general advice mediums or platforms over the course of a number of years, from financial literacy podcasts, numerous books, and also the rise of the finfluencers providing general advice through social media networks. Often the feedback we get from people reaching out to us is that they get mixed messages. So there is one particular platform will say one thing, another platform will say another, and it can become quite overwhelming because of those mixed messages,” Mr Hare said.

“That’s where the opportunity I believe lies for the financial advice industry, to really break through all that noise and to provide bespoke tailored advice,” he continued.

According to Mr Hare, while AI and ChatGPT are designed to provide responses to questions posed by a consumer, what’s crucial is the confidence their answer or advice bestows on that consumer.

“If they don’t have that confidence in that advice, it is the default to do nothing which may not be the right decision. Whereas the adviser can naturally handhold that particular member through that experience,” he concluded.