New Frontiers of Robo-Advising: Consumption, Saving, Debt Management, and Taxes

Abstract

Traditional forms of robo-advice were targeted to help individuals make portfolio allocation decisions. Based on the balance-sheet view of households, the scope for robo-advising has been expanding to many other personal-finance choices, such as households' saving and consumption decisions, debt management, mortgage uptake, tax management, and lending. This chapter reviews existing research on these new functions of robo-advising with a special emphasis on the questions that are still open for researchers across several disciplines. We also discuss the attempts to optimize jointly all personal-finance decisions, which we label ``holistic robo-advisors.'' We conclude by assessing fruitful avenues for research and practice in finance, computer science, marketing, decision science, information systems, law, and sociology.