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Financial Advisors Pushed Aside

ARLINGTON, Va.— A new report suggests more consumers are turning to fintech apps rather than financial advisors to manage their money, and that the trend will only increase as artificial intelligence becomes more mainstream.

“Fintech apps have simplified financial management and their capabilities are expected to be amplified with AI,” Capterra stated in releasing its analysis.

According to Capterra’s 2023 Fintech Survey of more than 870 consumer fintech users, 60% of respondents now seek advice from personal finance tools before reaching out to financial professionals. Furthermore, 64% of fintech users feel that these tools have significantly reduced their reliance on financial advisors, Capterra said.

Rapid Advance

“Fintech has rapidly advanced within the last few years, changing how traditional financial services are offered and how consumers manage their finances,” Max Lillard, senior finance analyst at Capterra, said in a statement. “While fintech won’t make advisors obsolete anytime soon, financial professionals need to adapt to changing consumer behavior and play up their strengths by augmenting their services.”

Capterra Chart

The Survey Findings

Capterra reported the survey found:

  • Millennials and Gen Z account for over half (55%) of fintech app adopters. They are empowered by user-friendly interfaces, data visualization tools, and real-time notifications, Capterra said.

  • The most popular solutions for fintech users include banking (82%), payments (63%), and personal finance management tools (57%).

  • Overall, 73% of fintech users actively use between two to five tools, which include everything from do-it-yourself investing apps to AI-powered planning tools.

  • Despite the high adoption of these apps, some fintech users still prefer an accountant to handle tax planning and preparation (47%), estate planning (42%), auditing and assurance services (34%), and business consulting (28%), Capterra said.

  • A “whopping” 89% of fintech users say they’ve encountered challenges while using apps. Security is the top concern, with 41% worried about the safety of their personal and financial information. Users also encounter hidden costs and technical issues, Capterra said.

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