Calling everything an algorithm rests on some implicit/vague assumption of computational universality (that subsumes human functioning!) which seems quite non-obvious.

It's a useless (tautological) statement unless we start with a good definition of what is and is not an "algorithm". From a cursory glance, this seems trickier than it looks, and once we have a constrained definition it's not clear any more that human minds operate in the same framework (strong claims require strong evidence).

Eg: If we define algorithms as what can be implemented on a Turing machine, then we're necessarily talking deterministic algorithms (allowing pseudorandomness), etc.

Good way of putting it, when does an algorithm become a heuristic?

For me the key thing is that when something is too complicated to quantify, attempting to quantify it will result in worse decisions. A bit like Hayek's calculation problem for the economy but for personal decisions.