Advisors Embrace AI, But Client Time Remains Elusive

Financial advisors are adopting artificial intelligence and portfolio-management tools to improve efficiency, but most have yet to translate that technology into more time for client relationships and business development, according to new Vanguard research.

Seventy-two percent of advisors said they wanted more time for prospecting and strengthening existing relationships, Vanguard found in a national survey conducted in July among 549 U.S. advisors.

“Time spent with clients is the currency of growth for financial advisors,” said Eve Cout, head of advisor solutions within Vanguard’s Financial Advisor Services business.

AI use remains concentrated in task support rather than full workflow automation. About 38% of respondents use the technology to draft emails, 35% employ it for research and 27% use it to record or summarize meeting notes.

Compliance and home-office hesitancy were the leading obstacles to broader AI use, cited by 37% of advisors. Other barriers included insufficient time to learn new capabilities at 34%, limited proficiency at 31% and concern that AI could diminish an advisor’s value at 22%.

Lauren Wilkinson, chief information officer for Vanguard Financial Advisor Services, said firms must progress from using AI to assist with individual tasks toward automating workflows if they want to free employees for higher-value work.

Advisors are also using outsourced portfolio solutions to gain capacity. Investment performance and track record were the most important considerations when selecting such tools, cited by 68% of respondents, followed by cost at 51%.

Yet 32% of advisors continue to manage client portfolios entirely themselves. Vanguard said its prior research indicates model portfolios can save an advisor more than 400 hours annually — roughly 10 standard workweeks.