Paraplanning – Alive and Planning

Written by Alan Gow
Personal Finance Professional - Paraplanning, alive and planning

Alan Gow on why the death of the paraplanner has been greatly exaggerated. View article

A well-known industry expert recently told a room full of financial planners and paraplanners that artificial intelligence (AI) will kill the paraplanning role “stone dead”. I am not sure this is going to be the most accurate of predictions.

I have been working as a paraplanner for nearly 20 years and, in the last few months, I’ve had great fun putting some of the wording from our suitability reports into the clunkily named ChatGPT to see what it can do. The result? Well, we pride ourselves on using plain English and keeping things really simple, but ChatGPT has helped us to take that a step further. It’s been useful – and that’s its job. But it doesn’t make me fear for mine.

Right now, ChatGPT is in its infancy, in the grand scheme of things. One of the interesting things about new tech is that we don’t know quite where it is going to take us.

The main issues with AI at present are that anything you put into it is effectively in the public domain and anything you take out of it might not be right. So, we can’t use AI, currently, to produce a full suitability report, for example. But it won’t be long before someone develops a tool that takes care of the data protection side of things. Maybe this will develop into a tool that integrates with your back-office system, so it can pull data directly from one source.

It seems a stretch, given the problems we have getting systems to integrate at present. The tech in our industry is rather fragmented. But I expect this will move forward at a significant pace. So, should us paraplanners be worried? Well, no, not really.

There’s no AI system on the horizon that will speak to a provider and discuss the details of protected retirement ages. There’s no AI tool that will intuitively know the ceding pension scheme charges don’t make sense, or that can answer the phone to a client and put their mind at ease when something unexpected has happened. People like people. Relationships matter and AI won’t change that. Ever.

“Relationships mater and AI won’t change that. Ever.”

Future planning

Many of the situations we deal with as paraplanners are delicate, nuanced and need carefully chosen words.

Certainly, the paraplanner’s role will change. Need a suitability report for an ISA contribution? Yes, a machine can do that. But despite some misconceptions (which are gradually ebbing away), a paraplanner is not a report writer. Sure, there might be some people who fill in the blanks in a template and describe themselves as a paraplanner. But there’s so much more to the role than writing suitability reports.

When we are talking with our adviser clients about options for a client’s financial plans, the situation is often far from being black and white. There’s no right answer. There are opinions, insight, client behaviours, peace of mind, tone of voice, emotions, feelings, trust, humour, friendship even. So, as much as we can expect the paraplanning role to develop in the coming years, isn’t that what happens organically anyway? AI is here, we can’t put it back in the box, so the only alternative is to embrace it, develop it how we want it and in a way that enhances the advice process.

Many years from now, we paraplanners will still be helping clients to make their needs and wants a reality. The death of the paraplanner has been greatly exaggerated.

Alan Gow is a Chartered financial planner at Argonaut Paraplanning.