AI Just Hit Wealth Management’s Core Business

Altruist’s launch of AI-powered tax planning inside its Hazel platform on Feb. 10 triggered an immediate repricing of wealth management stocks.

Shares of Charles Schwab, Raymond James Financial, LPL Financial and Stifel Financial fell between roughly 6% and 9% that day, according to market coverage. Bloomberg Intelligence analyst Neil Sipes attributed the move to concerns around “efficiencies being competed away, fee compression long-term and potential market share shifts.” Dennis Dick, chief market strategist at Stock Trader Network, told Reuters that traders “sell first and ask questions later” when new AI headlines appear.

The selloff centered on one feature: automated tax strategy generation. Hazel reads clients’ 1040s, paystubs, account statements, meeting notes, emails and CRM data to produce personalized tax plans “within minutes,” Altruist said in its Feb. 10 press release. The system also models “what-if” scenarios such as retirement transitions or asset sales in real time. Founder and CEO Jason Wenk said the feature “expands what a single advisor can handle” and “makes average advice a lot harder to justify.”

Tax planning sits inside the core revenue model of advisory firms. Many advisory relationships are priced as a percentage of assets under management, often around 1%, though rates vary by client size. Industry surveys cited by Barron’s show that ultra-high-net-worth portfolios can carry lower effective fees, sometimes closer to 0.66% in certain segments. Cerulli Associates has reported ongoing pricing adjustments across the industry as advisors respond to fee pressure. Tax planning is also one of the more labor-intensive services advisors provide, which ties it directly to the cost structure of advisory firms.