Robo-advisors gain traction amongst younger Singaporeans

About nine in 10 respondents under 35 years old have increased their use of digital channels in the past two years, compared to 75% amongst those aged 45-64 years, revealed a survey by Capco

Singapore's wealth management industry amongst individuals with minimum investable assets of $100,000 revealed that 76% of younger respondents are comfortable with AI guiding their wealth management decisions, contrasting with 42% of the older age group.

Robo-advisory services are gaining popularity, with 40% of respondents under 35 using them compared to 16% of those aged 45-64. 

Looking ahead, 27% of younger respondents express a strong likelihood of using robo-advisors in the future, versus 8% in the older group.

The survey emphasises that whilst face-to-face communication remains important, sophisticated digital communication has become essential. Capco recommends wealth managers adopt an omnichannel strategy to enhance client experience and meet the expectations of digital-native investors.

About 74% of respondents manage at least part of their wealth themselves, while 31% use wealth managers or financial advisors.

Only over a quarter (27%) of respondents use robo-advisors, with men twice as likely to use them compared to women (33% vs. 17%).

Forty-three percent (43%)  of respondents prefer a hybrid model of digital self-service and human interaction when using investment or wealth management services remotely.

Primary sources for investment advice include online research (69%), wealth managers/advisors (60%), friends, peers, and family (45%), investment books (36%), and social media (35%).

Meanwhile, over half (57%) of respondents under 35 years old are likely to change their wealth management provider in the next 12 months, with identifying the right advisor cited as a major barrier (37%).