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Why AI poses ‘both risk and opportunity’ for advisors and clients


“Anyone who’s used ChatGPT knows that AI can sound very human now. Someone can send you an email that reads like it came from your client, and it might not be your client,” he says. “We’re seeing more and more economies of scale in the hacking game, so you need to be very cognizant of your cybersecurity and have policies in place to protect against that.”

To safeguard his clients’ information and assets, Baynham has implemented a “two-factor authentication” policy for all communications at his practice. If they receive an email purportedly from a client asking to withdraw a large sum of money, for example, he says protocol is to always confirm the instruction via a phone call with the client.

“Advisors are going to realize that it will become easier and a lot more efficient for clients to research and get information from AI than they currently get from Google,” he adds. “In order to stay relevant, many advisors are going to need to move beyond providing basic cookie-cutter advice. Financial coaching, ensuring clients are implementing strategies effectively, customized solutions and knowing your client’s financial and family situation intimately are going to become more important to an advisor’s value proposition.”

An AI-powered lift for advisors

Baynham sees a longer list on the opportunities side of the ledger. At the most basic level, he envisions AI being used as a tool for client communication: taking minutes and generating to-do lists from client meetings, automating certain email tasks, and implementing simple changes based on client instructions, just to name a few.

On the back end of the advisor business, he says he’s already using some AI tools to help with decision-making and calculations in clients’ financial plans. Beyond determining whether a certain strategy could be positive for a client, Baynham says he’s able to calculate the actual financial impact a strategy would have, which wasn’t feasible beforehand.



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