NEW YORK ( MainStreet) — The future of financial advice may be online. At least, your financial advisor believes so. According to a Charles Schwab survey of registered investment advisors (RIAs) attending the longest-running annual conference in the industry, nearly half (45%) believe online investment advisories will be one of their top competitors in just five years.

While many financial consultants openly dismiss so-called "robo-advisors" as offering only elemental assistance lacking the sophistication of personal one-on-one advice, a recent study by Corporate Insight, a research and consulting firm for the financial industry, revealed a burgeoning industry of online advisory startups.

"As more Baby Boomers retire and begin to draw down assets, financial advisors and the broader investment industry must attract younger customers," writes Grant Easterbrook, senior research associate at Corporate Insight, in the analysis. "Compared to Baby Boomers, members of Generations X and Y have higher expectations for online and mobile services and don't see as much value in regular face-to-face meetings. Many also have a skeptical attitude towards large financial institutions and have eschewed active investment management for passive, index-based ETFs. These trends pose a clear challenge to existing financial institutions and create an opportunity for innovators that can offer cheaper and more technologically sophisticated alternatives than traditional investment firms."

The online platforms fall into ten basic service models, including algorithm-based investment advice, managed accounts, financial planning and budget management tools, as well as customizable exchange-traded funds (ETFs), among others.

"Algorithm-based advice is likely to have the biggest impact, at least in the immediate future," Easterbrook writes. "It addresses a gap in the mass affluent investor market, i.e., the lack of affordable, objective and rigorous portfolio analysis and investment advice."

Algorithm-based investment advice combines accounts into an aggregated portfolio that generates specific automated buy/sell/hold recommendations. Without human intervention, these services advise when to sell holdings that are high-cost, poor-performing or not in line with the consumer's investment goals. They also recommend purchases, with explanations provided for each suggestion.

Over 100 firms are battling for market share in the online advice space, including Financial Guard, Jemstep, Betterment, Wealthfront, FutureAdvisor and Learnvest.

Close to half (44%) of the advisors responding to the Schwab survey admitted that investors in the next 10 to 20 years "will want a different service model than today," but say technology is changing so fast and the needs are so different, they are unsure what this new service model will be.

Easterbrook says plan-specific 401(k) advice, low-cost managed accounts, financial advisor search tools, online-only advisors and customizable ETFs, all should benefit from the looming long-term trends.

"Regardless of the reasons behind this wave of startups, their leaders see tremendous potential for the Internet and automated services to upend the traditional investment advice model," he writes. "In many of their minds, this is just the first stage in what promises to be an industry revolution."