Why More People Are Paying for Financial Advice in the DIY Age
Why pay for advice when you can get it online for free?
Like many of you, I’m constantly looking up information online. Replacing a part in my truck? Looking for a specific type of paint for my daughter’s next art project? Adding code to my website? Google and ChatGPT have the answers.
The internet also has answers to many of your financial questions. There’s no shortage of quality personal finance content – books, YouTube channels, podcasts, and more. (I’ll list a few of my favourites at the end).
With the information and tools available online, you would think people would be more comfortable solving their own financial problems.
And to be sure, many are.
However, a McKinsey article published February 2025 found that the share of investors seeking holistic advice grew from 29% in 2018 to 52% in 2023.
McKinsey also found that clients are increasingly willing to pay a premium for human advice.
This begs the question: If it’s easier than ever to get information for free, then why are more people looking to pay?
Here are five reasons why I believe more people are seeking holistic advice:
1. The financial landscape in Canada is ever-changing.
The Income Tax Act is growing. Financial product complexity isn’t going anywhere. There is only so much time and energy someone can dedicate to keeping up. Clients have demanding careers, businesses, families, and other personal issues to worry about.
According to one Scotiabank poll, 81% of Canadians said that the financial world feels "more confusing and complex than five years ago".
The online tools that exist today can quickly solve basic financial problems for new investors, like opening an investment account and dollar-cost averaging into a suitable portfolio.
In contrast, there aren’t many tools to solve complicated situations for the older demographic. McKinsey's ‘Affluent and High Net Worth Consumer Survey’ of U.S. investors indicates that clients increasingly seek more holistic advice as they age. This is likely due to increased complexity around retirement, tax, and estate planning.
2. Information is freely available; Personal advice is not.
Let me pick on one example: Reddit.
(I'm comfortable doing this because I've used the site extensively for 15 years.)
Reddit is a massive online community that hosts thousands of 'subreddits'. There are hundreds of subreddits dedicated to finance alone. If you can find your way to a subreddit with a solid community, you'll generally find helpful information.
However, even on the highest quality subreddits, if you hang out for long enough you can't help but notice that even the most well-intentioned advice is highly impersonal. Which should come as no surprise, given that the users are mostly anonymous. And users are definitely not required to determine the suitability of a recommendation before providing it.
This means you’ll see a question like “What should I do with this $5000 I saved?” receive a flurry of well-meaning suggestions, including the names of ETFs to invest in. Meanwhile, the person asking the question hasn’t shared a single pertinent detail about themselves. What are their plans over the next few years? Are they single? Married? Have kids? In debt? Employed?
As any professional will tell you, it’s almost impossible to advise someone correctly without knowing anything about them. This makes crowd-sourcing personal advice extremely difficult. You can apply this concept not only to financial subjects, but in any subject where a conscientious approach is required.
3. The Internet's sentiment can change on a dime – even in more mature spaces.
This is anecdotal. But it seems to me that when markets are bullish, everyone discussing personal finance on social media is a disciplined, long-term, buy-and-hold investor. However when markets are bearish, such as during the immediate aftermath of Trump’s “Liberation Day” Tariffs, the most highly praised comments are often ones suggesting market timing or avoiding markets altogether.
To be clear, I don't fault people for getting excited when times are good, or cautious when times are bad. That's just part of being human. But these predictable highs and lows we experience while investing are exactly why your investment strategy needs to be aligned with your personal circumstances.
Safety nets like emergency savings and fixed income should be in place to provide you with stability, regardless of current stock market conditions. And you should never allocate money to a long-term strategy if that money is earmarked for a short-term need. A human advisor can help manage the emotional roller coaster of investing.
4. Unfortunately, the Social Media Age means both good and bad information.
For every well-researched, thoughtful, and nuanced opinion on social media there are a dozen more that are incomplete, misleading, or wrong.
According to one Scotiabank poll, a third (34%) of Canadians believe that "the worst financial advice comes from social media platforms". This is problematic, considering that the average Canadian spends around two hours per day on social media.
My personal experience with getting high-quality advice social media is that it's similar to shopping at a garage sale. You have to sort through a lot of junk to find something useful.
5. AI is great... but it makes things up.
(If you use AI regularly, I really hope you aren’t hearing this for the first time.)
According to an article published last week in the New York Times, OpenAI found that o3, it’s most powerful system, “hallucinated 33 percent of the time” on a test about public figures. (‘Hallucination’ is the popular term to describe the phenomenon of AI making up facts.)
Vectara, an AI research company, found that AI chatbots “made up information at least 3 percent of the time and sometimes as much as 27 percent” when tasked with summarizing news articles.
I am very excited about AI and use it every day. And while AI is a great tool with even greater potential, it is clearly not a replacement for an experienced professional. It is more likely that AI will empower professionals to better serve their clients, not replace human advice entirely.
Conclusion:
There is no shortage of information online. The problem is knowing:
1) How to tell the good from the bad, and
2) How to apply good information correctly to solve a problem in your life.
These two steps are the process by which good information turns into holistic advice.
Technology may solve this eventually. But until then, the market trends seem to support the idea that people increasingly want an experienced professional in their corner when it comes to solving life's big problems.
Thank you for reading!
As promised, here are a few of my favourite online information resources:
Book: ‘Psychology of Money’ by Morgan Housel, ‘Thinking Fast and Slow’ by Daniel Kahneman, ‘The Warren Buffet Way’ by Robert Hagstrom
Podcast: Rational Reminder, Financial Planning for Canadian Business Owners
Reddit: r/personalfinancecanada, r/cantax
YouTube: Well Built Wealth, Benjamin Felix
AI: Perplexity, ChatGPT
Free Courses: McGill Personal Finance
(Please be aware of scams and bad actors when seeking information online. Consult with your financial planner, tax professional or lawyer before making important financial decisions.)
Sources:
https://www.theglobalstatistics.com/canada-social-media-statistics/
https://www.nytimes.com/2025/05/05/technology/ai-hallucinations-chatgpt-google.html