How AI is really changing paraplanning

I see real potential for AI to drive efficiencies in the advice process, but I think it will work best in support of human experience, rather than in place of it. In financial advice, people are the profession’s primary asset and paraplanners are an essential part of the advice journey. It would be a huge mistake to see AI as a replacement for people, but I do think it will change the balance of activity within some roles.

When we talk to firms about their use of AI, the usual pattern is that they start with simple administrative tasks. Our Advice Efficiency Survey found that nearly nine out of ten respondents (87%) now use AI for note-taking and transcription and 44% use it for report writing. It’s easy to understand why. When you record a client conversation and get a transcript and set of notes back almost instantaneously, the benefits in time saved are immediately obvious. Our own analysis of intelliflo IQ Engagement Assistant suggests it can reduce the time firms spend populating fact finds and keying information into meeting reports by up to 85%.

Less time on a blank page

However, while transcriptions, notes and draft reports can be picked up by AI, they still need to be checked and approved by people. And the subsequent technical analysis and suitability judgement continue to rely on paraplanners’ and advisers’ expertise. The key change is that a transcript and draft report generated by appropriate AI will give you a solid starting point for the next steps. Our survey found that 30% of advice professionals spend three or more hours on a single report, and one in ten spend more than five. Although you’re still writing the report and making the judgement calls, you’re no longer starting from a blank page.

Reviews work the same way. Prep for annual review often means checking if a client’s been in touch in the last year, checking their ID is still valid, and making sure the fee agreement’s up to date. None of that needs your judgement, so automating it means the review can focus on what matters for that client, rather than on updating their details.

This benefits firms and clients alike. Our survey found that, on average, advice professionals rate the efficiency of their current workflows as 6.2 out of ten, with only a quarter (25%) rating their workflows as highly efficient (8+). Three-quarters (75%) said their processes limit the client outcomes they can deliver to some degree. By making parts of the advice journey more efficient, AI can remove some of the admin burden from staff and improve outcomes for clients at the same time. AI will struggle with the non-standard parts of a real client bank, but making the routine tasks faster to complete gives you more time to spend on more technical work or complex cases.

Building trust in AI

There can be a hesitance to use AI. Most firms describe a range of reactions from their teams, with some keen to embrace it and others preferring to stick with their tried and tested ways of doing things. The key to successfully introducing AI tends to be building a working example with the enthusiasts first, so colleagues can see it solving a problem. Letting people move at their own pace often works better than telling them they have to use something.

I’d also argue that a degree of scepticism is healthy. Technology is moving at pace and regulation is still catching up, although the FCA has been clear it favours a principles-based approach to AI rather than new prescriptive rules. Either way, responsibility for advice remains with the firm. Ensuring the AI you use meets the needs of your team and your clients safely and securely is essential.

You might worry about how clients will respond to your use of AI, but in general, they raise fewer objections than you might expect. The main concern is usually around how a recording is stored and used, not whether the meeting should be recorded at all. If you can explain in simple terms what security measures are in place to protect the client’s data, including whether it is used to train any public AI models, most will accept its use without too much discussion.

The existence of AI doesn’t make paraplanners less important. Instead, it changes the balance of the role, with less time spent on admin and process and more time on the technical analysis and judgement that adds real value to client outcomes.

This article was first published in Professional Paraplanner on 4 November. Please find a link to the original piece here.