AI threat to financial advisors? It may make money advice cheaper, but what about jobs - EY report answers

High-quality financial advice has traditionally been accessible mainly to affluent investors. Personalised portfolio planning, regular monitoring and financial guidance based on each individual's risk tolerance and goals, require significant human effort, making such services expensive for smaller investors.

But, artificial intelligence (AI) could change this model by reducing the cost of providing personalised financial advice. This could make tailored investment guidance more accessible to a much wider pool of investors across the country, according to a recent report by EY India.

Why could AI matter as more Indians start investing?

AI could be particularly important in India as more people from different income groups, cities, professions and age groups start investing. This growth is also spreading beyond metros to Tier-2 and Tier-3 cities.

Women are also becoming a larger part of the investor base, while younger people are beginning their investment journey earlier than previous generations. This growing and diverse investor base could increase the need for affordable, personalised financial advice.

The report estimates that India could bring more than 100 million additional individuals into long-term investing by 2035, with smaller-city households, women, young professionals and Gen Z among the groups that could contribute to this broader participation.

It also says that achieving that level of participation would depend not only on bringing more people into the investment ecosystem, but also on helping them remain invested and build wealth over the long term. This is where AI can play a crucial role by providing new-age investors with personalised investment advice, something tradional advisors have typically offered only for a fee.

“Investors differ not only in their financial capacity but also in their life-stage priorities, risk tolerance, financial literacy, digital maturity, behavioral biases, language preferences and need for reassurance. In this environment, standardized investor education programs and one-size-fits-all product journeys are unlikely to deliver meaningful outcomes at scale,” the report said.

Will the rise of AI impact jobs of human advisors?

AI offers a pathway towards a more individualised and inclusive model of wealth creation. Across the AI value chain, different technologies can be deployed to improve various layers of investor experience, EY explained.

However, the report does not suggest that traditional financial advisors will no longer be needed. Instead, humans can collaborate with AI models to access deeper insights, better portfolio analytics and smarter decision support while preserving the trust and accountability that remain central to financial advice.

AI can automate and scale routine tasks such as financial profiling and risk assessment, allowing human advisors to focus on more complex decisions, major life events, behavioural coaching and client interactions, essentially areas where the human element remains important.

Here's how AI can collaborate with investment advisors, as per the report:

Predictive AI can strengthen customer diagnostics, identify emerging needs, detect behavioral patterns and anticipate life-stage transitions.

Generative AI can deliver personalized financial education, contextual content, multilingual engagement and investor support tailored to individual circumstances.

Agentic AI can orchestrate investment journeys, automate servicing interactions, proactively recommend actions and assist both investors and advisors in real time.

“The objective is not to replace human judgment, but to augment it and extend its reach, making high-quality guidance accessible to millions of investors who have historically remained underserved,” the report noted.

For wealth managers, the question is no longer whether to adopt AI, but how quickly and responsibly they can scale it. The report says responsible AI adoption could expand access to trusted financial advice while maintaining transparency, suitability, fairness and investor protection.

This could also help wealth managers reach investors who were previously underserved by traditional advisory models.