As the hype regarding investors replacing human investment advisers with online websites and computerized recommendation services reaches a crescendo, a new Wells Fargo/Gallup study suggests people still prefer to invest with a human adviser.

Computer Investing Advice

What resources investors use for seeking investing advice

Nearly eighty percent of investors say they advice in some form: 37 percent said they rely on a dedicated financial adviser and not a financial website; 21 percent report using neither a dedicated financial adviser nor a financial web site to make investing decisions; 14 percent report using a financial web site and not a financial adviser, and 7 percent report using both a financial adviser and a financial web site to make decisions.

Investing Advice

The study found that investors with over $100,000 in the markets use human advisers to a greater extent than investors with less than this amount invested.

“Despite lots of buzz about online financial tools that allow users to submit their portfolios to computer algorithms, most investors still feel more comfortable involving a human, whether in the form of a dedicated personal adviser or a financial firm that gives them access to live counselors in a call center,” the report noted.

What resources investors use for obtaining investing advice

The findings come from a Wells Fargo/Gallup Investor and Retirement Optimism Index survey that was conducted in late June and early July, asking questions of sample of U.S. investors with $10,000 or more in stocks, bonds, mutual funds, or in a self-directed IRA or 401(k).

Computer Investing Advice women men

 

Investing advice: Lack of a gender gap

The report interestingly noted the lack of a gender gap in preference for computers over humans.

Survey results for men and women were virtually the same across the board, with an exception being Men are twice as likely to use a financial website to make decisions as are women.  There is negligible difference across investor types in the use of financial advisory firms, with about a third of each demographic group saying they use one.

What could be suppressing any major trend towards use of computerized financial advice.

In the end, the report concluded, the great majority of investors feel they need investing advice, while demand for financial advice could be greater if all financial factors were considered.  “The desire for professional input would likely be greater when advice needed for other types of financial matters (such as planning for retirement, college expenses, and healthcare) is factored in.”