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Robo-advice used by only 5% of Millennials, survey finds
Robo-advice used by only 5% of Millennials, survey finds
New research has found an overwhelming proportion of Millennial investors seek human interaction and expertise when looking for financial advice.
GlobalData's 'UK Investors Survey' found that only 5 per cent of UK Millennial investors solely use robo-advisers when arranging investments.
Thirty-seven per cent said they use an independent financial adviser, 27 per cent said they use a financial planner with their main bank and another 27 per cent arrange their investments themselves through an investment company, the survey said.
This was followed by 17 per cent of UK Millennials who said they use a financial planner with another bank, 15 per cent use a financial planner with an investment management company and the remaining 3 per cent said 'other'.
GlobalData wealth management analyst Sergel Woldemichael said the data shows that the vast majority of the more digitally advanced younger generations still require human interaction and expertise before they will make an investment decision.
Further, he said traditional wealth managers have experienced multiple recessions and periods of market volatility, proving they are able to weather a storm and with a potential market downturn on the horizon, robo-advisers may not be ready to tackle the risks to client investments that come with it.
"Pigeonholing the next generation into a digital chamber is the wrong way to view Millennials. Mobile investment apps are unable to cater to the emotional needs of humans when seeking financial advice," Mr Woldemichael said.
"A hybrid model is the best bet for the moment, and for the near future. Evidently, these digital natives are still seeking a human to collaborate with and gain valuable insight from."
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