Should You Use AI For Financial Planning?

Artificial intelligence (AI) is showing up everywhere, from side hustles to investment platforms, but using it to map out your financial future may not be a good idea. It’s true that AI can process information quickly and offer structured responses. But when it comes to real financial planning (retirement, college savings, tax strategies, or housing decisions) the gaps in AI’s understanding become a problem.

In our study last fall, Google's AI Overviews were incorrect or misleading in 43% of financial-related queries. And our experiences reading your comments over the last year don't make it seem like it's doing any better. 

For many people, the idea of typing a few details into a chatbot and getting a personalized plan sounds efficient. The issue is, financial planning is rarely that simple. You may forget to enter irregular income, underestimate expenses, or misreport a debt. Since AI treats your input as fact, a minor error can throw off the entire plan. 

Even if your data is correct, AI relies on what you ask it. If you don’t know to ask about projected healthcare costs or how inflation affects a Roth conversion, the tool won’t prompt you either. You only get answers to what you’ve asked, not what you’ve overlooked. In 15 years of talking to people about personal finance, there's one truth I've found: people rarely know what specific thing to ask.

Limitations Of AI In Financial Planning

AI may seem like the future, but it's important to remember that AI as we know it today is a fancy summarizing tool. There's no real “critical thinking”. These tools go out and steal content from the internet (sites like ours and many others), and then they aggregate the answers into what they believe is correct. They also have an underlying dataset – which may not even include the most recent information, or things like the government websites that have it (since they may be blocked from them).

Many times, these tools will basically regurgitate what you say, and simply make things up. They may even talk about tools or products that don't exist!

With this in mind, do you really want to be trusting them for million dollar financial decisions? We don't, and we don't think you should be either.

Here's six big reasons why:

1. Poor Inputs = Poor Outputs

Most AI models require accurate, complete data to function well. Miss a student loan, and the resulting plan may suggest over-saving or under-spending. If you enter your expenses loosely or forget annual costs like car registration or school fees, the results are skewed. 

AI lacks the context to check your math or ask follow-up questions the way a financial advisor would. Plus, you may not even be asking the right question, or you could be leading the AI on with inaccurate information you saw on social media!

2. Outdated Or Incorrect Information

Chatbots trained on older data sets or general web content can’t always keep up with current tax laws, changes in retirement contribution limits, or economic shifts. Planning for 2026 with outdated numbers from 2025 can cause real problems. 

A good advisor uses current data, while AI responses might lag months, or years, behind. This is especially true in light of planning for things like changes related to the Big Beautiful Bill.

3. Missing The Human Aspect

AI tools can’t walk you through the panic of a market dip or remind you to stay the course during tough times. Financial planning isn’t only about numbers. 

Behavioral patterns, emotions, and life events all matter. A trusted advisor helps clients stick to plans, make rational adjustments, and prepare for the unexpected. No bot can match that role.

4. No Accountability

When AI offers flawed advice, there's no liability or customer service. If a certified financial planner gives bad advice, you have recourse.

AI tools, even when integrated into financial apps, come with disclaimers: “for informational purposes only.” Here's what Google even tells you when you ask finance-related questions:

5. Biases And Gaps

AI’s advice may skew toward the data it was trained on, which can overlook lower-income households, self-employed workers, or nontraditional family structures. That can lead to recommendations that don’t reflect your life situation.

6. It's Tool And Account Recommendations Are Flawed

If you're looking for a new checking account or savings account, or other financial tool, you may have noticed that AI tools are trying to present you options. But where are they getting these options? A lot of the time it's from the actual financial account provider, Reddit spam, or even sponsored or advertorial listings. 

Instead of having actual recommendations that have been tried and tested, or rankings that are based on real facts (like fees or interest rates), the AI recommendations typically are generic, or the largest, or some other random variation that doesn't apply to personal finance.

When AI Might Be Useful

While AI isn’t ideal for full financial planning, it can be useful for:

• Getting ballpark estimates (e.g., how much to save for retirement)
• Generating basic financial checklists
• Answering basic tax or retirement questions
• Providing summaries of basic financial concepts

In short, AI is a tool, not a planner. It can help you understand the basics or prepare for a conversation with an advisor, but it shouldn’t replace professional help.

Tools That Can Offer A Better Approach

If you want to explore your financial future without a human advisor, there are more dependable platforms built specifically for modeling different life scenarios:

1. Boldin

Boldin focuses on goal-based planning and provides users with the ability to test different scenarios: early retirement, housing changes, income shifts, and more. It’s especially strong at showing how one decision affects another over time. There's a free version and a paid version. Check out Boldin here >>

2. ProjectionLab

Built for detail-oriented users, ProjectionLab allows for highly customizable inputs, tax strategies, and income modeling. You can simulate multiple retirement outcomes, investment strategies, and even future family changes. ProjectionLab also has a free version and a paid version. Check out ProjectionLab here >>

3. Empower (formerly Personal Capital)

Empower offers a mix of automated tools and access to human advisors. Its retirement planner is popular for showing how spending, inflation, and income sources interact over time. It’s less flexible than ProjectionLab, but great for tracking current net worth and savings progress.

Most people use Empower as a budgeting tool, but since it's free, check out their retirement planner. Check out Empower here >>

Final Take

AI is great at filtering information, but not at understanding your full picture. When it comes to personal finance, what you leave out can matter more than what you include. AI doesn’t catch omissions, ask clarifying questions, or adapt to emotional realities.

If you’re serious about planning your financial future, skip the AI tool for anything beyond quick questions. Use purpose-built planning tools, or better yet, a real financial advisor, who can help you build a strategy grounded in reality, with your goals, timeline, and circumstances in mind.

Financial planning deserves more than a one-size-fits-all algorithm.

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