• Wealth management is evolving rapidly, driven by regulatory complexity, generational wealth transfer, and rising client expectations for digital-first, personalised experiences.
• AI is helping firms scale and advisers become more productive, with tools like GenAI for summarising data, agentic AI for automating tasks, and chat assistants for improving client engagement.
• Client-centricity remains key, with technology enhancing—not replacing—human advisers, and digital platforms needing to balance automation with empathy, personalisation, and emotional intelligence.

The wealth management industry is undergoing rapid transformation. From shifting investor demographics to rising regulatory complexity and the acceleration of AI, firms are being challenged to evolve quickly. In this edition of Wealth Insider Insights, we spoke with Sarlota Hohwald, Director of Wealth Data Solutions at LSEG, to explore how firms are navigating this change, what technologies are gaining traction, and how to stay client-centric in a digital-first world.

Q. What do you see as the biggest challenges and opportunities in the wealth management industry today?

The industry is becoming much more tech-led and client-centric. Geopolitical shifts, economic factors, and regulations are shaping how investors and firms operate. Each region is navigating this differently, but there are common challenges.

Regulatory complexity is a big one—fragmented rules across jurisdictions increase compliance costs, especially for firms operating globally. Fiduciary standards are rising, and regulations around SRI and ESG are tightening. Data privacy and cybersecurity are also adding cost and risk.

Competition for client acquisition and retention is intense. Digital players are dominating, and younger investors are fee-sensitive, prefer holistic life plans, and expect digital-first experiences. Traditional firms are having to reinvent themselves and modernise their tech stacks. Market volatility is making clients more reactive, and firms need to deliver new tools and safe trading experiences—again, costly to keep up with. That said, there is also a looming shortage of advisers, which is pushing firms to use technology to scale as well as build up scale within human capital.

But, in general, wealth management remains a very profitable space, and we are seeing strong investment in it globally. The generational wealth transfer is bringing more digitally native affluent investors who want data and services to the forefront and technology is enabling personalised self-service advice and helping firms serve a broader range of clients more effectively and efficiently.

Q. How is technology transforming the wealth management industry, and what innovations are we seeing customers lean into around AI?

Technology is helping firms operate at better margins, improve time to market, and bring hyperscale to workforces. In wealth, AI adoption has been slower and more cautious due to trust and long-term unknowns or concerns, but in pockets, we can see it is insertion starting to deliver real ‘action’ or, value.

AI powered tools are making advisers more productive, helping them engage better with clients and surfacing the right information at the right time. Generative AI can easily summarise large volumes of fast-moving data—news, research, earnings calls, filings—into digestible insights quickly and accurately and can bring valuable fast-read meaning to users, but some might say buyer, beware, the output is only as good as the data powering it and needs to be from a trusted source. Also, now agentic AI has gained traction, this helps automate repetitive tasks, which in Wealth is able to give advisers more time back to focus on long-term wealth building goals with clients vs. Administrative tasks plus we are certainly seeing a surge of ‘AI co-pilots' being embedded in CRMs and banking systems that help advisers know who to call, when to call, and what actions to take. For investors, natural language chatbots simplify financial jargon, help with screening, and deliver personalised education, commentary and content in-app.

Q. With all the advancements in technology and AI, how can firms ensure they are being client-centric and not lose the human element of wealth management?

It is generally thought that Firms should use AI to enhance their human advisers—not replace them. Technology should handle repetitive or data-heavy tasks so advisers can focus on building relationships and bringing empathy into their interactions. 

There are a few ways firms can do this. They can use tech to foster better communication—video messaging, direct client messaging integrated into workflows. They can analyse portfolio performance and relationship health to understand decision patterns and client sentiment, which helps reduce disengagement and highlight risks or pivot points. 

It is also important to develop platforms that meet clients where they prefer to collaborate—whether that is a digital or human interaction, it needs to be in their channel of choice and seamless. And finally, firms should assign high-emotion or life-changing events to human advisers, not machines, let tech handle low-stakes tasks like moving money or rebalancing portfolios, while humans manage the more significant moments.

Q. What digital tools and capabilities do you believe are essential for delivering seamless and engaging client experiences in wealth management?

Investor expectations have changed dramatically. Over 70% of investors globally expect digital experiences on par with the apps they use every day—Spotify, TikTok, Netflix. It is all about frictionless access to financial services. Several capabilities are essential in the experience. 

First, fast and seamless digital onboarding. Second, robust portfolio management tools that show asset breakdowns, health, and risk exposure—these help both clients and advisers collaborate better.

Third, mobile-friendly platforms with sleek, intuitive design and accessibility across devices. Fourth, data—real-time, predictive, and personalised insights that help users make better decisions. There is often too much information, so personalisation is key.

Next, secure and convenient communication channels—messaging, chat, video. Trading and execution tools are table stakes, but the complexity depends on the client persona. More active investors need advanced products, analysis tools, alerts, and options builders.

Financial planning and goal tracking tools are also critical especially for the HNW client base —custom portfolio construction, integration with trusts, private equity, real estate, and tax optimisation would be optimal. Interactive tools to model scenarios and track progress are a must. And finally, education—webinars, access to pro-grade subscriptions, ratings or commentary services, social boards—this all helps build [financial] acumen, drive engagement and create safer trading environments for all.

Q. What do you see as the biggest challenges and opportunities facing the wealth management industry today – from regulatory pressure to generational wealth transfer?

There are multiple forces at play. Regulatory scrutiny is increasing, and rightly so—clients are paying significant fees for wealth management services. At the same time, technology is advancing rapidly, and new entrants are eyeing the market due to its profitability.

For traditional banks and wealth managers, the challenge is to deliver a consistent, high-quality customer experience while adapting to the self-service trend. For digital-first players, the opportunity lies in evolving clients from gamified investing to active users or into a longer term managed account scenario.

AI, public expectations, and regulatory frameworks will all play a role in shaping the future. The key is to empower advisers within these constraints and to define how each institution wants to differentiate itself in a crowded market.

Balancing scale with empathy
As Sarlota highlights, the future of wealth management lies in scaling intelligently using technology to enhance human capital and relationships, not replace them. AI and digital tools are transforming how firms operate, but the human element remains essential. The firms that thrive will be those that deliver seamless, personalised experiences while staying grounded in trust, empathy, and client-centricity.

Read the original article here.