ORLANDO, Fla. (WGEM) – Artificial intelligence is reshaping not only the workplace but also personal finance, with a recent survey from Empower revealing that 47% of Americans feel more comfortable using AI for financial decisions compared to a year ago. However, questions remain about the reliability of chatbots in managing savings and planning for retirement.
AI tools such as Chat GPT, Gemini, and Microsoft Copilot claim to answer a wide array of questions, including those related to finance. As a result, more individuals are turning to these digital assistants for guidance on financial matters, from retirement savings to debt repayment.
“They’re able to track and categorize things much better than they ever used to,” stated Joel President, CEO of Nelson Financial Planning. A study indicates that while only 6% of baby boomers have utilized AI for financial management, the numbers rise with younger generations: 18% of Gen X and at least 30% of millennials and Gen Z have experimented with AI-based financial tools.
Retirement planning is a primary focus for many users, with almost half seeking advice on how much money they will need to retire. AI often references the “4% rule,” which suggests that retirees can safely withdraw 4% of their savings in the first year, adjusting for inflation in subsequent years. However, financial experts caution that this guideline is outdated and emphasizes that there is no universal solution.
Security also poses significant risks in the realm of AI finance tools. Garris, an industry expert, noted, “The biggest issue online now is the spoofing of websites.” Alarmingly, studies have shown that nearly 4.5% of AI-generated prompts contain sensitive personal or employer data that could be inadvertently copied, stored, or shared. “Once AI has that information, then chances are everybody’s going to have that information,” Garris explained, raising concerns about data privacy.
Despite the advantages of AI in financial planning, experts warn users to proceed with caution. A test conducted by Money.com revealed that AI finance tools may overlook critical details, such as payment history or realistic timelines, which could lead users to make risky financial decisions. While AI can serve as an effective starting point for financial guidance, it is crucial to recognize that it should not replace professional advice.
As technology continues to evolve, experts recommend utilizing AI tools as a means of initial guidance rather than relying solely on them for financial decisions. Engaging with a qualified financial advisor remains essential for making informed choices about one’s financial future. The landscape of AI in personal finance is rapidly changing, and as users become more comfortable with these tools, the conversation about the balance between technology and traditional advice is likely to intensify.
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