9 min read
How Financial Advisors can Save Time and Build Better Relationships by Integrating AI Throughout Their Workflow
With a little due diligence and a healthy amount of skepticism, AI can be an asset that helps you win business, not take it away.
Key Takeaways
Getting a grip on AI can take time, but the efficiencies and optimizations to be gained cannot be understated.
It's unlikely that AI will ever be able to replace the human emotions of empathy and compassion, or the nuanced understanding of a client’s personal experience.
Strongly governed and high-quality data can overcome the legitimate concerns of accuracy and security that are inherent to AI-generated results.
The emergence of DeepSeek as yet another giant of artificial intelligence (AI) and open-source large language models has the financial advice industry asking a familiar question: Will AI replace real-life financial advisors? It’s a simple question with a nuanced answer. In short, no, but....
The financial landscape is increasingly complex and data driven, and sorting through large amounts of data is one thing AI does very well. It’s also one thing that takes up a lot of time for financial advisors. But it can’t sort through much unless it’s embedded across the data and analysis tools of an advisor’s technology partner. It’s important to find a partner that has not only embraced AI but has both the quantity and quality of data necessary to improve an advisor’s workflow.
We’re not just talking about eliminating the grunt work of searching, sorting, and categorizing investments, although it will do that. There’s more to consider, like administrative and operational tasks. It can take time and effort to get a handle on AI, but the efficiencies to be gained are well worth it.
Morningstar’s recent Voice of the Advisor survey showed that advisors spend only 50% of their time on client-focused activities. The other 50% is split between things like gathering and analyzing relevant information to make informed decisions and provide personalized advice, marketing activities, like promoting your services and building your brand, and communicating with external partners like wholesalers and portfolio managers.
Morningstar’s recent Voice of the Advisor survey showed that financial advisors spend only 50% of their time on client-focused activities.
That 50% of time spent with clients isn’t enough considering the convergence of public and private markets, political shifts, and other market events that have investors raising their hands and filling their advisors’ inboxes with questions about adjusting their portfolio and financial planning. These questions force advisors to do even more ad-hoc research, analysis, and reporting, detracting from their efforts in other areas of their business.
By embracing the transformative technology of AI, advisors can not only reclaim their most valuable asset—time—but enhance their advice with greater depth and insight than ever before.
Use AI to Communicate at Scale and Deliver Empathetic Real-Time Insights
Artificial intelligence is best suited to complement a financial advisor’s workflow. AI chatbots, like Morningstar’s own “Mo,” who’s embedded in several Morningstar products, can respond to an advisor’s workflow questions. Morningstar recently analyzed 850 unique questions asked of Mo by financial advisors and a large portion of them were related to workflow support. These questions include “How do I create a portfolio?” and “How do I import data into the platform?”
Nearly all of the 850 questions financial advisors asked Morningstar’s AI chatbot, Mo, were related to workflows.
AI language-based models can also significantly reduce response times to clients by providing an advisor clear and concise drafts for pressing market concerns. While machine learning algorithms excel at processing vast amounts of financial data, identifying market trends, and recognizing headline news, it is vital that advisors ensure the underlying AI-produced information is accurate, reliable, empathetic, and tailored to a client’s specific needs.
With access to data aggregation capabilities like ByAllAccounts, part of Morningstar Wealth, and Licensed Data reports generated by a firm’s tech stack can become the definitive source of truth for AI-generated outputs. By leveraging standardized and enriched data from over 15,000 sources, including historical market, client, and alternative data, Morningstar and Pitchbook data empowers financial advisors with a holistic view and rich insights that validate and enhance AI-generated communication. 
Establishing Trust with AI-Driven, Human-Approved Advice
An advisor spends about 30% of their time analyzing, trading, and implementing investment strategies for their clients and another 20% performing operational tasks. Advisors that embrace AI’s predictive analytics capabilities can help maximize these processes and assess risk more quickly. By analyzing historical data, market indicators, and economic factors, AI's advanced algorithms can identify patterns, correlations, and insights that may not be immediately apparent to human advisors.
As humans, both advisors and clients typically are skeptical by nature and may not blindly trust the results AI produces. In fact, in our Voice of the Investor survey we found that about 75% of investors still have some questions about the long-term viability and security of AI integrated tools. With products like the recent launch of Morningstar Direct Advisory Suite, advisors can quickly summarize independent and objective research and ratings on thousands of companies, securities, and funds through our integrated language-based AI engine, Mo.
Both financial advisors and their clients maintain a healthy level of skepticism for AI and the results it produces.
By simply interacting with Mo and utilizing a revamped UX interface, advisors can compare different asset allocation options, swap and compare investment strategies against hundreds of Morningstar Indexes, and build detailed proposals. Advisors can integrate Morningstar’s full complement of capabilities into their AI models to ensure accurate and reliable insights. This builds a trusted foundation for AI-driven but human-tested advice.
Avoid the Pitfall of Poor-Quality Data
The old adage garbage in, garbage out is never more critical than when evaluating wealth management centric AI tools. Perhaps the most important consideration when selecting an AI partner is the ability to vet and trust the data from which the AI tool will be pulling the information. This is particularly important for early adopters that are looking for the outsized gains that new technology can offer.
The volume and variety of investable products have skyrocketed—outpacing the industry’s capacity to effectively assess each new vehicle and asset class. Poor or fragmented data sets can compound errors. At the same time, as private markets expand and public offerings converge—with firms waiting longer to list—opportunities abound yet demand equally rigorous data oversight. For AI to become an engine of insight, capable of personalizing solutions at scale, advisor’s need the right combination of market coverage and data governance. Morningstar’s broad coverage, rigorous data governance, and AI-driven analytics enable firms to confidently navigate product proliferation, regulatory complexities, and rapid market shifts.
Embracing Innovation as a Financial Advisor
To stand in the way of innovation is a sure way to be run over by it. After many years of being resistant to change, the financial services industry has rapidly embraced innovation. Artificial intelligence integration is the latest technology reshaping financial services, but it will not be the last. AI will likely never be an option to replace human interaction, compassion, intuition, and thoughtfulness. At the same time, AI can and should be a valuable tool in the arsenal of any forward-thinking advisor looking to expand the limited 50% of their time they have to interact with their clients and prospects in the best way possible.