Real users are already relying on generative AI for retirement planning. One 41-year-old engineer completely overhauled his $200,000 portfolio based on ChatGPT's advice to shift into index funds and bonds, praising its prudence. This mirrors a broader trend: a Lloyds study found more than half of British adults now use AI for financial guidance, with a third doing so weekly.

This surge is rattling traditional finance. An AI tool launch from fintech firm Altruist last month triggered a sharp sell-off in wealth manager and broker shares. CEO Jason Wenk warned it makes "average advice a lot harder to justify." However, experts stress AI's critical flaws, including confident hallucinations on tax rules and unreliable math, as models predict answers rather than calculate them.

The UK's Financial Conduct Authority has launched a formal FCA review into AI's future impact. Independent tests by Which? found Perplexity provided the most accurate personal finance answers, while Meta's responses were the weakest and most generic. The core risk, as JPMorgan's John Bilton notes, is users mistaking AI's structured information for genuine understanding, especially as pension rules grow more complex.

For now, many with straightforward situations see AI as a replacement for advisers, while those with complex finances use it to prep for consultations or check work. The technology's current value lies in efficiency and modeling long-term strategies, but its inability to grasp nuanced legislation or individual circumstances means full reliance remains dangerous.