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AI and fintech: Friend or foe in wealth management?
27.02.2026Over recent years, AI has sped from the realms of science fiction to real-world ubiquity. It now plays a key role in many aspects of modern life, not least in our finances.
Long-term human relationships – based on trust and mutual understanding of goals – remain the backbone of financial planning. But technology increasingly sits alongside, aiding efficiency, monitoring risk, and even optimising portfolios.
Used correctly, technology can be incredibly useful. It can automate simple tasks, freeing up adviser time to do what we do best. However, this technology also carries inherent risks that shouldn’t be overlooked.
Keep reading to find out more.
The promise of AI is a friendly assistant – an efficient, smart decision-maker in a close human-robot relationship
Enhanced efficiency
Managing your money is a full-time job. Advisers and planners analyse complex data sets, forecast market movements based on myriad factors, and craft tailored plans and reviews – doing the hard work so you don’t have to.
In this context, AI and technology will never replace the human being you turn to and trust. This is especially true for high net worth individuals for whom the impact of mistakes or poor judgment can be so significant.
But tech can help increase efficiency by automating routine administrative tasks, like producing meeting notes, setting reminders, or suggesting talking points. This frees up adviser time that can be dedicated to maintaining and growing your wealth in line with your goals.
Smarter portfolio management
Tech can work alongside finance professionals to enhance decision-making by analysing complex data sets far more quickly than a human could. This ensures advisers and planners have all the available information they need to recommend the best option for you and your circumstances.
The advice we provide is based on global market movements while remaining tailored to your individual circumstances. Embracing AI and technology’s ability to analyse and forecast based on huge amounts of data is just one way of unlocking its potential.
Improved risk monitoring
From robo-advice to generative AI, technology is grounded in systems and probability, which makes it particularly useful for risk monitoring and internal compliance.
Where strict rules and regulations apply, these can be transposed and embedded in systems. Even when dealing with tolerance to risk and attitudes to loss – both very human and highly personal – strict parameters can be set to ensure tech maintains constant adherence.
The real-world applications might include a clear audit trail of compliant decision-making at the company level, or an automated nudge where market movements require a revisiting of your personal asset allocation.
Technology is fast-evolving but is still in its infancy, so there are risks
Algorithmic bias
Just as our decision-making as humans can be affected by emotional and cognitive biases, so technology has its own inbuilt prejudices and potential misconceptions.
AI is heavily reliant on probability and often gravitates towards the most widely held view. In human-based behavioural finance, this might manifest as trend-chasing or herd mentality. But confirmation bias and familiarity bias also play a part.
Your financial plan is unique to you and your complex circumstances. AI can suffer from overconfidence bias, finding it hard to distinguish between “correct according to probability” and “suitable for you ”.
Regulatory oversight
New and advancing technology will inevitably lead to increased regulatory oversight. This is good news for consumers, professionals, and the industry as a whole, as it helps to maintain standards. However, it could also lead to increased reporting. This, in turn, could take up the time the technology was employed to save.
There is also the problem of transparency, where decision-making has occurred or been informed by actions “behind the scenes”.
Security and privacy
As technology and AI improve, they can (and are) being used to combat fraud, even as scammers utilise them for their own ends.
For AI to be helpful in planning and portfolio management, it requires accurate financial data, and that means sharing personal information. Wherever digital information-sharing occurs, there is the possibility of misuse, requiring significant safeguards.
Get in touch
AI isn’t going anywhere, so finding ways to integrate and make use of it will be crucial for financial planning and wealth management firms. We can use it to work alongside, rather than replace, humans, and we’re always looking to adopt a human-technology-human approach to ensure the accuracy of inputs and outputs.
If you have any questions or concerns about the rise in technology and AI to help manage your money, please reach out to your Foster Denovo adviser by emailing advise-me@fosterdonovo.com or calling 0330 332 7866 for more information.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
Sources: https://www.wealthenhancement.com/blog/pros-and-cons-using-ai-manage-your-finances
https://sterlingandlaw-hampshire.co.uk/alternative-investments-high-net-worth-individuals/
