Gen Zers and Millennials are far more receptive to incorporating artificial intelligence (AI) technology in helping them achieve their financial goals, finds new research from Northwestern Mutual.
The latest findings from the firm’s 2024 Planning & Progress Study finds that 57% of Gen Zers and 55% of Millennials are excited about how AI and generative AI (GenAI) tools could help them reach their financial targets. Furthermore, 63% of Gen Z and 57% of Millennials believe AI could “improve the customer experience in the financial sector, including with financial planning.”
Older Americans were more skeptical about the technology’s role in financial planning—38% of Gen Xers and 23% of Baby Boomers conveyed excitement over the technology, while 44% of Gen Xers and 32% of Boomers believed it could improve their experience with financial planning.
While unconvinced about AI, older workers were receptive to the idea of financial advisors leveraging AI features to ask better questions and help them build wealth, Northwestern Mutual’s Christian Mitchell said.
“Younger generations are more willing to accept having their financial services partners leverage GenAI to manage their money,” said Mitchell, who is executive vice president and chief customer officer at the firm. “The majority believe AI and GenAI can be a fantastic addition for a trusted advisor, helping financial professionals deliver even better results and experiences for their clients. The bottom line is this: artificial intelligence can help organizations find human capacity, not replace it.”
A blend of human and AI capabilities
Northwestern Mutual’s research also underscores the shift towards human advisor and AI collaborations. Even as most say they trust humans (54%) far more than AI alone (15%) with retirement planning, the findings show clients are open to advisors utilizing the technology.
Specifically, respondents were at least “somewhat comfortable” with advisors incorporating AI to detect fraud (38%), analyze data to predict future trends (41%), model and illustrate financial scenarios (43%), analyze data related to financial habits, preferences, decisions, and behaviors (41%), provide real-time financial guidance (39%), and join meetings with them while being responsible for capturing information and prompting next steps (37%).
Moreover, others were “somewhat comfortable” with financial service firms using AI for administrative tasks, including answering a straightforward financial question (39%), making updates to answer basic customer data (37%), answering service calls and responding to questions (36%), and adjusting existing financial plans (34%).
By delegating these tasks to AI, advisors will free up time that could instead be used to further build out client relationships, Mitchell adds.
“It’s still very early in terms of how far the technology will go, but AI tools are going to allow for the mass automation of tasks, significantly reducing manual work and deeply improving efficiencies across not just financial services, but most industries,” said Mitchell. “By alleviating the most tedious and administrative aspects of our work, it will free up precious time to focus on building human connections and deliverables that provide the greatest value.”
Northwestern Mutual’s study fielded responses from 4,588 online interviews among U.S. adults ages 18 and over.
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.