Why Artificial Intelligence Can’t Replace Human Wisdom with Your Finances, Ep #265

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AI is everywhere, from investing apps and portfolio tools to recipe planners and vacation organizers, artificial intelligence touches countless corners of our lives. In finance, AI promises accessibility. For newer investors, it’s a way to learn basic concepts, compare traditional and Roth IRAs, or understand the difference between tax brackets, all delivered in plain English.

AI is also a huge help with organization and financial efficiency. Need a budgeting framework or quick ways to categorize cash flow? AI can create those. It’s a handy pocket assistant that helps you plan and ask sharper questions when evaluating financial advisors or planning your future.

The Real Limitations of AI in Financial Planning

While AI is a powerful tool, it is not a decision maker. Here are the big dangers and drawbacks you need to keep in mind:

1. Zero Personal Accountability

AI doesn’t bear the consequences of its advice. If it suggests an irreversible move, like a Roth IRA conversion, based on incomplete or incorrect information, the cost falls entirely on you.

2. Overconfidence in Precision

AI delivers advice with absolute confidence, even when it’s wrong! Financial planning isn’t just numbers, it’s trade-offs, nuances, and judgment calls that factor in health, family dynamics, and personal emotional risk tolerance.

3. Struggles with Multi-Year Tax Planning

Most AI tools treat tax decisions generically just one year at a time. But real retirement tax planning means looking ahead 10, 15, or 20 years. Missed integration here can cost you tens, or even hundreds, of thousands of dollars over a career or lifetime.

4. One-Dimensional Investment Advice

AI assumes perfect discipline and zero life changes, no panic selling, no sudden need for funds. But human emotion, especially during retirement or volatile markets, often drives decisions.

5. False Sense of Security

AI’s confident answers may mask underlying complexity. A small financial misstep, repeated or compounded over decades, can grow into a massive problem down the road.

6. Lack of Behavioral Guardrails

Emotions play a huge role in retirement and investment decisions. Life throws curveballs—loss, illness, market downturns, and AI cannot reframe your fears or keep you disciplined when things get tough.

When Human Wisdom Matters Most

Retirement planning isn’t about finding simple answers, information is cheap, wisdom is not. For complex questions, AI offers basic options, but it can’t weigh the sequence of return risk, or policy changes in real time, like a qualified advisor can. Human advisors coordinate, prioritize, and apply experience to your financial life. They support you through market cycles, health challenges, and family transitions, and recognize when purely rational advice doesn’t capture your real needs.

Using AI Wisely

My advice is to use AI for learning and organization, not for important, irreversible lifestyle and tax decisions. Always double-check its work, and don’t outsource your financial future entirely to algorithms. Technology plus human judgment delivers the best outcomes. AI is a powerful tool, not a complete solution.

Outline of This Episode

  • 02:24 Best in Wealth Podcast future plans.
  • 03:57 AI in daily life and finance.
  • 04:51 Advantages of AI for do-it-yourself (DIY) investors.
  • 08:08 Using AI for financial information.
  • 12:29 Limitations and dangers of AI in financial planning.
  • 16:57 Limits of AI financial planning.
  • 19:30 No behavioral guardrails when it comes to your taxes.
  • 25:43 If a decision affects your lifestyle for the rest of your life, don’t outsource it to AI.

Connect With Scott Wellens

Podcast Disclaimer:

The Best In Wealth Podcast is hosted by Scott Wellens. Scott Wellens is the principal at Fortress Planning Group. Fortress Planning Group is a registered investment advisory firm regulated by the US Securities and Exchange Commission in accordance and compliance with securities laws and regulations. Fortress Planning Group does not render or offer to render personalized investment or tax advice through the Best In Wealth Podcast. The information provided is for informational purposes only and does not constitute financial, tax, investment or legal advice.

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About the author, Scott Wellens

Scott Wellens, CFP® is an investment advisor and founder of Fortress Planning Group. After earning his Bachelor of Science degree from the University of Wisconsin-Oshkosh, Scott quickly ascended to become a Vice President of North American Sales at a major regional provider of telecommunications infrastructure. While financially successful in this role, Scott searched for ways to pursue his passion related to financial literacy and providing financial freedom for both his own family and others. During his search, Scott became curious about the significant gap he found in the financial services sector: he was unable to find a comprehensive financial planner that maintained a family stewardship lens without being attached to financial products. Scott decided to fill that gap by creating his own planning firm that maintains a strong passion for comprehensive, unbiased wealth planning that is genuinely client-centered.

Scott resides in Menomonee Falls, WI with his family. He is the father of three active and independent daughters who keep him on his toes. Scott is an active community member, serving on the Hamilton Education Foundation Board, serves as a Dave Ramsey Financial Peace facilitator and leads the All Pro Dad’s group at their local elementary school. Scott enjoys spending his free time visiting state parks with his family, reading, and watching the Milwaukee Bucks and the Green Bay Packers win ball games.

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