As the benefits (and potential drawbacks!) of Artificial Intelligence become more and more discussed, its uses also become better explored.
From writing novels to medical diagnosis, and school lesson planning to finding fake dating profiles, the applications of AI are seemingly ever-expanding.
ChatGPT is one of the most popular AI chatbots currently available, developed by the pioneering AI research company OpenAI.
Recently, money experts like Moneyzine have been looking into the possible uses of ChatGPT in the personal finance sector.
So, how can ChatGPT help get your finances in order?
We consulted an expert… and then went to ChatGPT to find out.
How to use ChatGPT to master your personal finances
Finance expert Jonathan Merry offered four top tips for using ChatGPT to help manage your money.
From defining financial terms to planning for retirement, here is what he suggests, and what advice ChatGPT offered us.
Explaining financial jargon
Whether you are reading an online article about personal finance or looking through the terms and conditions of a financial product, ChatGPT can summarise or define terms that can often be difficult to understand.
Jonathan Merry, CEO of Moneyzine, says: ‘One of the main (and entirely fair) criticisms that the finance sector gets is that it uses complex terminology that is completely inaccessible to the average person.
‘When you don’t understand something when reading an article, you no longer have to go searching online, trawling through around 5 different sources for the answer.
‘You can go straight to ChatGPT and have a conversation around the topic until you understand it totally. You can even ask for examples of how that specific thing works!’
Metro.co.uk asked ChatGPT: ‘Can you explain the term “compound interest” in language that is easy to understand for a UK audience, and provide some examples of when it might be used?’
Here is what it said…
Helping with budgeting
ChatGPT can help advise you on budgeting and how to save money.
Jonathan Merry says: ‘If you give ChatGPT specific information about your financial situation, like your income and expenses, it can provide you with some actionable advice for either bulking up your savings or how to pay off debt sustainably each month.
‘Everyone’s financial situation is unique to them, but with ChatGPT, you can have a conversation around the advice it gives. You can outright tell it “no, I’m sorry that doesn’t work for me, try something else” and it will get back to you with alternative solutions.’
Metro.co.uk provided ChatGPT with a hypothetical financial situation and asked it for budgeting advice.
Here is the information we provided:
… And based on that information, here is what ChatGPT recommended.
While we asked the Chatbot to take into account the specifics of the hypothetical situation a lot of the advice it provided was quite general rather than specific, although it did refer to a number of the expenses listed.
However, the AI chatbot also provided us with a caveat, stating:
‘Remember, these suggestions are general and may not apply precisely to your situation. Adapt them to fit your needs and priorities.
‘Regularly reviewing and adjusting your budget is key to effectively managing your finances and maximizing your earnings.’
Planning for your retirement
Saving for retirement is crucial for anyone who wants to enjoy their golden years without financial stress.
Retirement is when people want to relax, travel, and spend time with loved ones. However, without proper savings, retirement can be a time of worry and struggle.
ChatGPT can help you work out what your retirement goals look like and how you could achieve them.
Jonathan Merry says: ‘ChatGPT can help people plan for retirement by providing personalised recommendations on how much to save, when to start saving, and where to put your money to get the best value for it – including providing information on various tax benefits specific to your country.’
To test this theory, Metro.co.uk sent ChatGPT another hypothetical scenario.
We asked: ‘ChatGPT, I’m currently 26 years old. If I wanted to have a retirement income equivalent to £1,500 a month at today’s currency value (including my state pension) by the time I reach my government retirement age, how much would I need to save and how should I go about it?’
ChatGPT replied: ‘To estimate how much you would need to save for a retirement income of £1,500 per month, it’s important to consider several factors, including your current age, government retirement age, expected investment returns, inflation, and the impact of the state pension.
‘Since specific details regarding future changes in pension regulations and investment performance are uncertain, I can provide a general approach to help you with your retirement planning.’
It then offered us eight steps to take to plan for retirement.
However, once again, it finished by telling us: ‘It’s important to note that retirement planning involves various assumptions and variables.
‘The guidance provided here is general and may not account for all individual circumstances. Consider consulting with a financial advisor or pension specialist who can provide personalized advice based on your specific situation and goals.’
The fact that the Chatbot was more speculative in this scenario makes more sense. Retirement planning often involves considering what the financial landscape will look like over decades and decades.
However, it did provide some actionable steps rather than factors to consider.
A word of warning
ChatGPT is not infallible. AI chatbots can ‘hallucinate’ and present incorrect information as factual.
As such, it is essential to treat its answers with the appropriate scepticism and always to get professional financial advice.
Jonathan Merry says: ‘Always take whatever it tells you with a pinch of salt, and try to find a second opinion from a trusted source for anything of importance.
‘While it’s certainly not the cure-all for everyone’s problems, it’s a great starter for people who are looking to dip their toes into financial literacy and secure their monetary futures.
‘After all, if you can prove that it’s given you some bogus information, that means that you’re learning to be smarter than it!’
Is it safe to give ChatGPT personal financial information?
With any AI chatbot, you must be careful about what information you provide them with.
Artificial Intelligence chatbots are experimental technology and must be treated as such.
Metro.co.uk asked ChatGPT if it was safe to provide it with personal financial information.
This is what it said: ‘As an AI language model, I don’t have the capability to store or retain personal data. I’m designed to respect user privacy and confidentiality.
‘My primary function is to provide information and answer questions to the best of my knowledge and abilities.
‘If you have any concerns about privacy or data security, please let me know, and I will do my best to address them. However, I would still advise you to be cautious and avoid sharing sensitive personal information online.’
MORE : We let ChatGPT pick our clothes and the results were… interesting
MORE : Samsung bans ChatGPT for employees after data leak
Follow Metro across our social channels, on Facebook, Twitter and Instagram
Share your views in the comments below
