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2024 Adviser Technology Needs Report

Surge in AI Adoption and Cybersecurity Focus Transforms Adviser Technology Landscape

Advisers consolidate tech stack: Seeking better integrations, user-friendly client portals, and improved non-custody asset reporting.

AI adoption soars: Over a third of advisers are leveraging AI to enhance practice efficiency, with further growth expected.

Cybersecurity prioritised: Advisers rank security as a top factor in choosing investment platforms, ahead of brand and education. 

Sydney, 8 July 2024 – Leading research firm Investment Trends releases its 21st edition of the Adviser Technology Needs Report, providing an in-depth review of how financial advisers are adapting to evolving technology trends and industry demands.

The report shows a strong demand for better technology integration as financial advisers consolidate their tech stacks, emphasising the need for user-friendly client portals and improved reporting for non-custodial assets. Large practices, especially those with five or more advisers, are more inclined to increase their tech budgets to achieve these benefits. Advisers estimate their annual average tech spend at $37,000 and plan to increase it by 6% to $39,000, while larger practices aim to boost their tech budget by 8% to $91,000 per annum.

“Advisers recognise the need for seamless integration across their technology platforms to enhance client experience and operational efficiency,” said Ludovic Sevestre, Associate Research Director at Investment Trends. “This integration is crucial for delivering accurate financial advice, allowing advisers to focus on client relationships and planning. For providers, the opportunity lies in developing systems that adapt to future advancements, driving growth and client satisfaction.”

The results show the adoption of artificial intelligence (AI) is on the rise, with 37% of advisers already using AI tools to improve practice efficiency. A further 43% of advisers express interest in integrating AI into their practices, contingent on support for implementation, security, and privacy concerns. Current users primarily use AI for editing (42%) and customer service (33%), with substantial interest in AI tools for reporting (34%), customer service (34%), modelling (33%), analytics (30%), and practice management (29%).

Copyright 2024: Investment Trends. 2024 Adviser Technology Needs Report

“AI is transforming the financial advisory landscape by automating routine tasks and providing deeper insights through data analytics,” noted Sevestre. “Advisers who embrace AI will be well-positioned to offer more efficient and personalised services to their clients, gaining a competitive edge. Providers that develop AI tools to enhance client interactions and strategic decision-making will lead the way in this evolving landscape.”

Cybersecurity remains a critical concern for financial advisers. Over one in five advisers (21%) rate security among the top three most important factors when choosing an investment platform, surpassing brand and education. The most common security measures



implemented include multi-factor authentication (MFA), anti-malware software, and strong passwords. Despite these measures, 36% of advisers rate their practice’s cyber-readiness as below 7 out of 10.

“Security is paramount in protecting client data and maintaining trust,” emphasised Sevestre. “Advisers are increasingly prioritising cybersecurity in their technology investments, recognising it as a cornerstone of their service offering. Providers who focus on robust security measures will safeguard client information and reinforce their reputation for reliability and trustworthiness, essential for long-term success in the financial advisory sector.”

About the report

Investment Trends' 2024 report delivers deep insights that underscore the ongoing transformation in the financial advisory sector driven by technological advancements and heightened security awareness. As advisers continue to navigate these changes, industry regulators, leading banks, investment platforms, fund managers, and financial planning software providers need to be ready to take advantage of these opportunities.

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