The Future of Financial Advising

The Future of Financial Advising

Chia-Li Chien, PhD, CFP®, PMP®, Apr. 23, 2019

My husband TC and I were in San Francisco two years ago. I was on a business trip, TC visited friends and families. One night after our dinner, we went to the Mall for a walk. We found this robot that asked my husband if he’d like to learn how to dance. TC hesitated but the robot started to show some dance moves with a song. After 30-seconds or so, TC said, “Oh, this is stupid!” The robot immediately stopped and said to my husband, “Would you like to learn another language?” I laughed so hard, and I believe the robot is smarter than my husband!

Robots have been helping with our daily chores for decades. I grew up having a rice cooker as a typical kitchen appliance. Today, a cat could press the button for you to get your rice done. A couple of years ago, I bought a bread machine so I can have home-made whole grain bread. I make mostly Chinese steam buns from the bread machine today. Did I mention that your cat now supervises the vacuum robot at your home? While you are busy at work, your cat sits on top of it. Obviously, people programmed robots to help us. Robots tend to help us free up time so we can enjoy other more important things like eating, living, and entertainment.

Having robots or automation is not new in the financial industry. Robo-Advisor is the latest trend where the primary focus is to reduce costs for investors. According to Stat Bank from Journal of Financial Planning, robo-advisors managed assets worth $75 billion in 2018. The same report indicated that robo-advisors are in the upward trend to $250 billion assets under management by 2020.

But who uses robo-advisors, you ask. Well, the same report mentioned previously indicated that 23% of financial advisors use robo-related tools when managing their clients’ assets. Wealth management will be transformed through 44% of robo advice in the next few years. Many of us believe that robo-advisor is great for Millennials. Here are the top seven robo-advisers according to a 2018 report from Robo-Advisor Pros: Betterment, WiseBanyan, WealthSimple, Acorns, Charles Schwab Intelligent Portfolios, Stash, and Wealthfront. My daughter is 22; technically speaking she is Gen Z, just a few years shy of Millennials. She is in a Ph.D. program with a full ride plus stipend. She is a saver; she saved a lot of money just two and a half years in her muscle stem cell biology study. I always assumed that she would use robo-advisors. But she will tell you, “My mommy is my adviser.” Yes, she comes to me for help picking her stock choices. The more automation is out there, the more human advice or contact is needed.

As a matter of fact, recent research reported that the top five common counseling services include debt management, credit counseling, retirement or estate planning counseling, money management counseling, and savings/accumulation counseling (Durband, Carlson, & Stueve, 2019). The human behaviors type of counseling is not something robo-advisors can do yet. We still need the human interaction to relate our emotional needs to financial decisions.

Speaking of human interaction in financial decisions, I meet with a client in their Time Square (NYC) office a couple times a year. One time, I noticed there was an incredible mural in a tiny Taiwanese soup dumplings restaurant that I frequently visit. The owner told me that his son Jerry is an artist and not completely together. Although he wants Jerry to manage the restaurant, Jerry is an artist at heart. So instead of forcing Jerry—who is the third generation of a wealthy family—to manage his restaurant, he combined the art into his business just to keep his financial decisions and behavior intact.

There is a global problem that most wealthy families face (Miller, 2019). There is a Chinese saying, “Wealth never survives three generations.” In the U.S., we say “Shirtsleeves to shirtsleeves in three generations.” In UK, “Clogs to clogs in three generations,” and in Italy, “From stalls to stars to stalls.” According to a BNY generational wealth study, the first generation was often the entrepreneurs, CEOs, and real estate developers who created the wealth. They passed on their work ethics to develop the second generation. The second generation is mostly professionals such as doctors, attorneys, or accountant. The second generation often survives the wealth. About a third will survive the wealth in the third generation, and less than 5% wealth survives by the fourth generation.

Often I hear wealthy families asking questions about legacy wealth such as “How much is enough?” or “How much is too much?” or “How much is enough that they’ll do something, but not too much that they’ll do nothing?” The answer often lies in “How much have you prepared your next generation?” Smart families establish family governance to prepare their next generation about their privilege and responsibilities early. Every family could have a family governance, not just the super wealthy ones.

For example, 15 years ago, we established a family trust housed in a Donor Advisor Fund. Each year, we set aside one dinner in our annual vacation to collaborate on which non-profit organization(s) we will support upcoming year. Collectively, we make decisions on how much to support them, and how much we contribute into the trust fund. The idea here is to teach our daughter that her privilege comes with responsibilities no matter how small compared to other wealthier families. Children learn from watching us. If we display proper financial behaviors in every decision, they will learn from us, not from the robots. Robots can always assist them with cost and time savings, but the family values we pass on are timeless and far more valuable than the wealth itself.

So the future of financial advising is about areas that robots can’t yet handle. That is, to teach and learn proper financial behaviors when making financial decisions.


Stat Bank. (2018). Stats & Facts. Journal of Financial Planning, 17.

Friedberg, B. A. (2018, July 7). 7 Best Robo-Advisors for Millennials. Retrieved from Robo-Advisor Pros:

Durband, D. B., Carlson, M., & Stueve, C. (2019). The Financial Counseling Profession. In D. Durband, R. H. Law, & A. K. Mazzolini, Financial Counseling (p. 3). Cham, Switzerland: Springer Nature Switzerland AG.

Miller, J. (Feb 2019). Secrets of Successful Families – Transferring Family Values with Wealth for a Lasting Legacy. 8th Annual Institute of Tax, Estate Planning and The World Economy (STEP Orange County). Newport Beach, CA: BNY Mellon Wealth Management.

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