I’m a mid-career financial planner, so I admit I have a personal stake in the debate about artificial intelligence (AI) and financial advice. Like many professionals across industries, I wonder whether AI might one day replace my role. The technology clearly offers powerful tools and efficiencies, but its current limitations suggest that human financial advice will remain important for many years.
Technology has shaped investing for decades
Technology has already transformed large parts of the financial industry. Robo-advisors, which use algorithms to build and rebalance portfolios based on an investor’s goals and risk tolerance, became visible in the U.S. with Betterment in 2008 and arrived in Canada a few years later. These platforms reduce the need for frequent human interaction, particularly in jurisdictions with looser regulatory requirements.
Despite the convenience of robo-advisors, they still hold a relatively small slice of Canada’s investment market. They serve investors who prefer a low-cost, index-based approach and who don’t want to actively manage accounts. However, robo platforms have not replaced traditional full-service advisors on a large scale. Many investors continue to rely on human planners for guidance that extends beyond automated portfolio construction.
ETFs offer a parallel: technology as an enabler, not a replacement
Exchange-traded funds (ETFs) have been available to Canadian investors for more than three decades—the first ETF in the world was launched in Canada in 1990. ETFs make it possible to construct diversified, low-cost portfolios without a human advisor, and they are widely used by do-it-yourself investors.
Still, the arrival of ETFs did not eliminate the role of financial advisors. Instead, many advisors incorporated ETFs into their toolkits, using them to improve portfolio construction and reduce costs for clients. This history provides a useful analogy for AI: new technology can expand options and efficiency without fully displacing the need for human judgment and personalized planning.
AI could streamline investment research and trading, and it might help deliver broader financial guidance more quickly. I have experimented with AI tools for retirement and tax-planning questions. Much of the output was technically sound, but some responses relied on U.S.-centric information and missed Canadian specifics. That mismatch underlines a key limitation when AI models aren’t tailored to jurisdictional nuances.
Personalization: where human advisors still excel
Personalized advice is often the most valuable part of what a human financial advisor delivers. People have unique priorities, family situations, tax profiles and emotional responses to money. Two clients with similar incomes and assets can still require notably different recommendations because of different goals, risk tolerances or life circumstances.
In my practice, factual analysis is only half of the work. The other half involves the psychology of money—helping clients understand what money means to them and how their values and relationships should inform financial decisions. That emotional and behavioral guidance is difficult for AI to replicate today.
Nevertheless, AI can be a useful educational tool. It can help consumers prepare more informed questions for their advisors and accelerate routine research. In that sense, AI resembles search engines and other information tools: it speeds discovery and can raise financial literacy, but it does not automatically deliver fully tailored advice.
Advisors stand to benefit from AI as well. The technology can improve efficiency—automating portfolio rebalancing, generating reports, and identifying investment opportunities—allowing advisors to spend more time on planning and client relationships instead of manual tasks.
AI for investing: an important tool, not a one-stop solution
AI’s most practical role in financial advice may be to broaden access. It can lower costs and make basic guidance available to younger investors, people with smaller account balances, and self-directed investors who want support but cannot afford full-service advice.
To sum up what consumers should expect from AI-generated financial advice:
- AI advice can be high-quality but may include subtle inaccuracies, especially if the model relies on sources from other countries.
- Recommendations may be useful for many users but won’t suit every individual situation—personal circumstances matter.
- AI systems can reflect biases or gaps in their training data, so their outputs should be reviewed critically.
Those caveats apply to human advisors as well—no source of advice is infallible. The difference is that human planners can adjust recommendations to reflect complex family dynamics, behavioral factors and jurisdiction-specific rules in a way AI currently struggles to match.
Like ETFs, AI will likely become another tool in the investor and advisor toolkit. Used intelligently, it can improve outcomes and efficiency; used uncritically, it can lead to mistakes. For most investors, the best approach will be to use AI to inform decisions while relying on a qualified advisor for tailored planning and judgment.
Read more from Jason Heath:
- How to invest as a teenager in Canada
- How to start investing with ETFs in your 20s
- Should you accelerate your mortgage payments—or invest?
- Tax planning for Canadians who invest in the U.S.