Humans are warming to the idea of AI money management
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The robots are coming for your monthly budget — but for some, that might not be a bad thing.
Zoom in: A clear majority of younger Americans are embracing artificial intelligence as a way to help them achieve their financial goals, according to data released this week by Northwestern Mutual.
- The firm asked nearly 5,000 respondents how they felt about AI helping them balance their personal books. Among them, over half of Gen Z-ers and Millennials described themselves as "excited" by generative AI tools that help inform their financial decisions, particularly data analysis.
- However, older generations voiced at least some reservations about AI, and the survey revealed people are more comfortable with AI performing certain tasks than others.
The big picture: Already a massive source of investment, AI is already being put to work in various ways on Wall Street and the tech sector — and creating fortunes in the process.
- But Northwestern Mutual's data suggests that people are thinking beyond the confines of ChatGPT about how the emerging technology can create efficiencies in their everyday lives.
Yes, but: Don't roll out those financial algorithms just yet. For most financial planning tasks, research showed that a clear plurality of respondents still preferred humans (54%) to just AI alone (15%).
- And as ever, the data is skewed by age, with a generation gap separating the Zoomers and Millennials from Generation X and Baby Boomers.
What they're saying: The trust factor for AI is clearly limited to help in "managing a budget or keeping track of money," Christian Mitchell, executive vice president and chief customer officer at Northwestern Mutual, told Axios recently.
- While consumers are still not at the point where they're willing to give "unfettered access" to automation, "we're going to live in a world awash with AI. There's always going to be a huge role for a human."
Complex factors like inflation, higher borrowing costs and general anxiety about the future has prompted consumers to look "for for education and guidance more than ever," John Mileham, chief technology officer at Betterment, tells Axios in an email.
- "There's always going to be a lot of nuance involved with financial advice so it's understandable that advisors and consumers alike worry about getting inaccurate advice if a human isn't involved," he adds.
The bottom line: As AI continues its inexorable march across industries, it may seem as if resistance is futile. But as Mitchell emphasized, AI can help enhance productivity and be a helpmate rather than a replacement.
