20% of Americans are already using AI for financial advice — another 70% don’t trust it

A Gallup survey with Edward Jones finds about 1 in 5 (20%) Americans who sought financial advice in the past year used AI, but overall trust remains low—only ~3 in 10 have “a great deal” or “some” confidence in AI’s expertise, with just 3% trusting it “a great deal.” While 8 in 10 adults express some confidence in financial advisers, only ~1/3 of those seeking advice relied on a professional; 73% leaned on their own internet research. Experts urge using AI to explain concepts and verify via other trusted sources, citing missing fiduciary responsibility.

Analysis

The market should treat this as a slow-burn distribution issue, not a near-term earnings driver. The important mechanism is that AI is becoming an entry layer for financial decision-making while trust remains low, which favors platforms that own the customer relationship but do not need to be the sole source of “advice.” For SCHW, that is modestly positive over 6-18 months if AI increases account openings, engagement, and self-directed trading, but it is not enough on its own to re-rate the stock.

The bigger second-order loser is the high-touch, fee-heavy advice model: if younger cohorts increasingly use AI to frame decisions before speaking to an adviser, the advisor’s role shifts from primary source to validator, pressuring wallet share and possibly slowing asset gathering for firms with expensive human sales forces. That said, the survey also signals a trust gap, which caps the pace of displacement; in the next 1-3 months this is more narrative than financial impact, and any selloff in advice-linked names would likely be overdone absent hard evidence in AUM flows or client retention.

For SCHW specifically, the risk is regulatory and liability framing if consumers start associating AI-generated guidance with brokerage platforms. If Schwab integrates AI tools, the upside is lower servicing costs and higher conversion; if it stays passive, competitors with better UX could capture younger users. The falsifier is simple: if AI usage translates into materially higher engagement and new accounts over the next two earnings cycles, the stock should outperform; if not, this remains a branding headline rather than a fundamentals story.

Key Decisions for Investors

• Stay neutral-to-slightly long SCHW on any AI-related pullback; treat this as a 6-12 month optionality story rather than a catalyst for immediate multiple expansion. Risk/reward improves if the stock de-rates on ‘AI threatens advice’ headlines without any deterioration in net new assets or trading activity.
• Pair trade: long SCHW / short a high-fee advice-heavy wealth manager basket (e.g., AMP, LPLA) over 3-6 months. Thesis: AI compresses the value of human-led guidance faster than it commoditizes low-cost brokerage distribution.
• Watch item, not a trade yet: if SCHW announces AI-assisted planning tools or a materially better retail onboarding funnel, that could justify a re-rating. Confirmation would be a 1-2 quarter inflection in younger-account growth and client engagement metrics.
• Avoid shorting SCHW on this headline alone. The survey supports channel shift toward self-directed research, which is more likely to route assets through large platforms than to eliminate demand for them.