When to trust AI with your finances—and when to call a human

[WORLD] If you haven’t yet explored the benefits of artificial intelligence, you’re falling behind. A recent surge in adoption reveals that 71% of businesses now use AI for at least one function—up from 65% just last year.

This rapid uptake highlights AI’s growing influence across industries. A new report from McKinsey shows that companies applying AI to financial operations have seen efficiency gains of 20% to 30%, particularly in areas like data analysis and risk management. But there’s a caveat: the report also warns that leaning too heavily on AI—especially without human oversight—can result in significant errors, particularly in complex areas like tax compliance and investment planning.

With AI now deployed in everything from customer support to diagnosing medical conditions, traffic flow management, autonomous vehicles, and fraud detection, it’s no surprise the financial sector is joining in.

But when it comes to personal finances, there are times when a conversation with a real person still matters. Here are three questions you should never ask AI—and a few smarter alternatives.

Don’t Ask: What are my estimated tax payments this year?
Instead Ask: How do taxes work for the average earner?

When it comes to AI, general queries work best, says LJ Suzuki, President of CFOshare, a company that uses Read AI to provide outsourced finance departments for small businesses.

“It’s fine to ask AI something like, ‘How do estimated income taxes work for S-corporations?’” Suzuki explains. “But avoid asking it to calculate your estimated income tax payments for next year.”

The reason? AI systems are strong at explaining general concepts, but they falter with personalized calculations. Tax laws, for instance, vary by state and frequently change—details that most AI tools won’t fully grasp unless specifically trained on them. A human expert, on the other hand, can interpret these nuances and offer tailored advice.

In short, AI is best used to gain foundational knowledge.

“AI is excellent for giving someone with no background in a topic a good overview,” Suzuki said. “If you’re unsure how estimated taxes work, it’s a great place to start.”

Ironically, AI tends to stumble with math—despite our assumption that computers should excel at it.

“People find that surprising, because traditional computers are fantastic at logical operations,” he added. “But AI is different. It thinks more intuitively, which can lead to mistakes in logic and arithmetic.”

Don’t Ask: How should I invest my money?
Instead Ask: How much am I actually spending on takeout?

AI thrives when it comes to analyzing habits and patterns, says Sam Taylor, VP of technology at Cleo, a financial assistant app powered by AI.

“Questions like, ‘Where did all my money go this month?’ or ‘How much am I spending on takeout?’—those are where AI tools can be very helpful,” Taylor noted.

Thanks to advances in machine learning, apps like Cleo and Mint can track spending, categorize transactions, and help users identify where they can cut back. But while these tools are increasingly sophisticated, Taylor advises against relying on them for major financial decisions like investments or loans.

“For now, AI can help you understand how to start saving or budget better,” he said. “But when it comes to personalized investment advice, you’re still better off with a financial advisor.”

Don’t Ask: What can I do to reach my retirement goals?
Instead Ask: Am I on track for my target retirement date?

AI can be surprisingly helpful for assessing retirement readiness—at least on a basic level.

Joseph Patrick Roop, financial advisor and host of the Retire(meant) for Living podcast, once fed an AI assistant this scenario: “I’m 52 years old, have $500,000 in my 401(k), and $63,000 in a brokerage account.”

The AI responded with a solid overview, including projections for retirement savings and Social Security benefits. But it didn’t cover every angle.

“It gave a great initial breakdown,” Roop said. “But there were additional strategies and tools it didn’t suggest—ones a financial advisor would have considered.”

This limitation is backed by research. A 2023 study from the Center for Retirement Research found that AI-driven projections often lean too optimistic, overlooking variables like healthcare costs, inflation, and lifestyle shifts. That’s why human judgment remains crucial.

AI Is Evolving, But It Can’t Replace Humans—Yet

Despite rapid improvements, AI is still not ready to fully replace human financial advisors.

“AI isn’t advanced enough to serve as a financial strategist,” said Suzuki. “But it’s great for offering general guidance on best practices.”

As AI technology evolves—particularly with innovations like generative AI and predictive analytics—its potential in personalized financial planning will grow. Still, experts agree that the human touch remains essential for building trust, providing empathy, and navigating individual life circumstances.

The future lies in a hybrid approach: let AI handle data-intensive tasks, while people focus on strategy and relationships.

“AI is excellent at generating useful ideas,” Suzuki noted. “If you’re struggling with late payments from clients, ask it, ‘What are the best practices for B2B collections?’ You’ll likely get advice you hadn’t thought of before.”