Schwab Study Finds That One in Three Investors Will Adopt Technology at a Faster Rate to Manage Finances Post-Pandemic

COVID-19 has accelerated the adoption of technology across many aspects of life, from virtual birthday parties to appointments with financial advisors by video chat, according to a new study by Charles Schwab. When it comes to personal finances, four in 10 investors (41%) report that they used technology and digital tools to manage their finances more during the COVID-19 pandemic than ever before, and 32 percent say they will continue to adopt technology at a faster rate post-pandemic. One in five investors (19%) believes that technology will fully manage their investment portfolio within a year. Yet human support remains critical among new and seasoned investors alike in times of uncertainty – both say the first place they turn during market swings is a financial advisor.

“The pandemic spurred rapid adoption of digital investing tools and technology, creating a unique opportunity for financial services companies to innovate how we serve customers and continue to build trust,” says Neesha Hathi, Schwab’s Chief Digital Officer. “The past year has reinforced that it’s not a question of meeting investors either digitally or in person – but combining the best of both to engage investors where and when they are looking to take action to manage their finances.”

Technology is top pick for financial transactions, but when finances get tough investors need the human touch

When it comes to interacting with a financial institution, investors fall into three evenly divided groups as to whether they prefer to engage primarily through technology or people. Around a third prefers mostly using technology (37%), a third prefers mostly talking to a person (32%), and a third prefers a combination of technology and in-person interactions on an ongoing basis (31%). And while 54 percent of investors believe it is possible to have a personal relationship with a financial company by interacting with them only through technology, most also agree that there are times for technology, and other circumstances that merit an interaction with a person.

Most investors say that technology is best for more transactional activities:

• 71% say that technology is best for simple, more transactional financial tasks, such as tracking expenses, but not for complex ones
• 71% say that technology helps them reach their financial goals
• 70% say that technology decreases the amount of time they spend managing their finances
• 65% say that technology gives them peace of mind when it comes to their finances

“People are used to doing everything on their phones, and they expect managing their finances to be as easy as one-click online shopping or hailing a ride share,” says Zack Gipson, managing director of Schwab’s digital investor solutions. “This sets a high bar for financial services companies to deliver easy, modern digital experiences that rival digitally-native companies consumers trust, while differentiating through seamlessly integrating the best of technology and people.”