Over-50s prefer humans over digital platforms for financial advice

Would you feel comfortable following the advice of a robo-adviser?

Digital platforms that provide automated, algorithm-driven financial planning services first emerged in 2008 during the financial crisis. Since then, they have grown in popularity -- but new research shows that the technology has a long way to go before it can really compete with traditional advisers.

In a survey of more than 1,000 adults over the age of 50, financial services technology provider Visible Capital found that respondents overwhelmingly rejected the idea of using, or even sharing their data with, a digital or robo-adviser.

The research looked at attitudes towards financial planning and technology among people aged 50+ in the UK and Ireland.

As many as 82% said they would not be happy to take financial advice from a digital adviser and 88% would not be willing to give details of their finances to a robo-adviser, even if it meant they could get a personalised service.

Over-50s are engaging with technology to manage their finances, but this is mainly for day-to-day tasks. The survey revealed that 84% were using online services for general banking, 64% for payments and transfers, 55% for managing their credit cards, and 44% were managing their savings and investments digitally. However, only 15% of respondents used online services for advice -- suggesting that there is a clear preference for face-to-face advice.

"It's clear from what our 'silver surfer' respondents are telling us that they do not want to engage with the digital or robo-adviser landscape," said Richard Braidwood, COO of Visible Capital. "They have voted unequivocally for real life, flesh and blood financial advisers."

Most of the respondents also had no interest in going online to deal with their pension admin. Visible Capital was surprised to find that 69% were not familiar with the concept of the Pensions Dashboard -- a way of accessing your pensions information online, securely and all in one place. An overwhelming 85% said they were not interested in using a Pensions Dashboard service.

"The over-50s are traditionally the most engaged in pension provision so it was really surprising to find that so few over-50s had heard of the concept and even less were interested in using it," commented Ross Laurie, CEO of Visible Capital.

Elsewhere, the survey found that 64% of respondents plan to leave an inheritance to their children or grandchildren. Yet 69% of those surveyed have never taken advice on inheritance planning.

"My fear is that they won't be passing on as much wealth to their family as they imagine," Laurie said.

"This clearly presents a significant opportunity for financial advisers to provide advice and I suggest that this is a statistic that they should write on a post-it note and stick to their computer screens."