Should your employees trust a robot for all their financial decisions?

19th October 2015

At the end of September the Financial Conduct Authority (FCA) held a conference to discuss the growth of robo advice in the UK. Robo advice is an online service which uses a mixture of algorithm and technology to create an investment strategy.

Jonathan Watts-Lay, Director, WEALTH at work, a leading provider of financial education, guidance and advice in the workplace comments, “Although there is a place for robo advice for employees who are saving  and want to make simple investment choices, it is also important for them to be able to discuss these choices before making a decision. This is particularly the case for those who are nearing retirement, as the decisions are so much more complex and the implications of getting a decision wrong are so much bigger.”

He continues, “I’m sure an algorithm could be created that allows for the many different scenarios that need to be taken into consideration at retirement such as; all pensions (whether defined contribution or final salary), other saving such as ISAs and deposit accounts, tax issues, health, longevity, risk profiling etc. However, this would require a lengthy online process, which is solely reliant on an employee’s interpretation of the questions and their response to them. I suspect that many would prefer to arrange to talk to an adviser whether over the phone or face-to-face, to benefit from their experience and reassurance rather than trust it to a robot!”

Further coverage can be found in Personnel Today.