According to a Bloomberg report, wealth managers are turning to their regular clients and automating the services they currently rely on.
The article revealed a revealing piece of jargon used by Debashish Patnaik, a partner at consulting firm McKinsey & Company: “massive affluent,” referring to wealth management clients with $1 million or less of liquid assets. If you’re massively wealthy, I hate to break the news that your money manager never really cared about you, and can no longer manually compile those reports about how things are going in your portfolio.
“Mass-affluent customers now get something close to private-banking quality from AI,” Patnaik told Bloomberg. According to Patnaik, this changes the picture when it comes to what financial institutions want from potential wealth managers.
Meanwhile, the “truly rich,” to use Bloomberg’s term, will get more personalized service as wealth management is further divided into automated and ultra premium versions, according to Patnaik. The new services that the job will require make a money manager like a mix between a crowdfunding consultant and a parent. Firms will need workers with skills such as the ability to manage succession events, an understanding of “family dynamics,” the ability to decide “which family member will inherit what” for the owners of the universe, and the warmth necessary to “hold their hand” when the market takes a negative turn.
Since AI can’t do any of this, Patnaik says companies will “do the heavy lifting toward it.”
But your experience as part of the hateful crowd will soon cease to include a real money manager. Patnaik told Bloomberg that companies will need to hire for roles that oversee automation and AI software: “experts, behavioral data scientists, personalization architects, and human-in-the-loop oversight professionals.”
The Bloomberg story indicates that Citi is at the forefront of this change. Joe Bonanno, Citi’s head of wealth intelligence, told Bloomberg that his company is introducing “AI-supported software” like a chatbot that tells clients how to manage their children’s college funds, and a push-button system that can “draft an email from the chief investment officer and explain what it means for the client.”
Through all this AI, Citi clearly feels that customer engagement will increase. “Engagement keeps customers happier and more stable,” Bonanno told Bloomberg. Personally speaking, I like to be happy and clingy.
But none of that matters according to everyone’s favorite infinite-money-cheat-code-finder Elon Musk, who said in an interview in January that because of AI, everything we know about saving money is about to change. “We’re at the top of the roller coaster, and it’s about to go down,” Musk said on the podcast Moonshots with Peter Diamandis, noting it’s not entirely clear whether that’s good or bad. “Don’t worry about spending money for retirement in 10 or 20 years. It won’t matter,” he told Diamandis.
Whatever that means is great, most of us aren’t successfully saving for retirement anyway. Can’t wait to see what the near future holds for both the rich and the poor.
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