Ask HN: Thoughts on AI in Personal Finance? | Hacker News Reader

Ask HN: Thoughts on AI in Personal Finance?

6 pointsfoxtrot867211 comments

Would you trust an AI to assist you with financial decision making? What would be some requirements to be comfortable with it?

View on HN

For big stuff like portfolio allocations? Hell no. It's a solved problem with a few good solutions already. Broad market cap weighted indexing, target date funds. Any custom themed portfolio the ai comes up with is bonkers. It may chase recent past performance and load you up with a DRAM themed portfolio. Which may be great for a few years but then you get left behind when you fail to rotate out of dram at the right time. Cap weights have rotation baked in.

For small stuff? Maybe. If it can give some insight into total cost of owner ship. on things like cars. Used vs new. The ai could compare price charts, depreciation, etc to rank some good value buys. But that can be calculated with traditional non-ai logic, just needs data.

The easy part in providing the model with enough context about your existing portfolio etc.. the challenge is about understanding your goals and optimizing towards them in the long run in terms of expenses (ongoing and then things like house, saving for kids), investing (portfolio mix, asset allocation, access to alternatives) and tax strategies. A model can do a good job on each one of those vectors separately. Whether it can do so holistically on all vs. a human professional (who's good at his job + has access to models) I think is a much harder question. This ofc becomes much more true if you are dealing with a complex portfolio, or longer time horizons. Hope this adds something to the convo.

The biggest annoyance with personal finance for me is bill paying and has little that ai can address. Either you let a bunch of third party systems automatically bill your account or you have to login to each billing account, find the amount, look up the pay date etc... And thats just one core problem - the other automation issue is actually logging into every billing account. And not thanks to a centralized thired party holding every password to every financial account I have.

At least some institutions are getting alternative pay only access profiles but its a slim minority and they close but not quite what is needed for secure consumer side automated bill paying

Yes, but I would not trust it to execute those decisions.

I would use it to analyze my situation, take into consideration my goals, as well as my fears and anxiety. e.g. I worry about taxes, and do not trust bonds.

Expect it to provide several plans with a list of reasons as well as pros and cons.

But I must own the final choice. One of my fears is if it does it, someone will learn to anticipate its moves and then exploit me via the AI.

> What would be some requirements to be comfortable with it?

I’d have to know less than I do about what capabilities LLMs have and don’t have.

I already did- I ask it to inform purchasing decisions and use it as a google to determine etf/bond allocations

Do I need a custom app for this? No, claude in a csv + me looking over it works fine. Im not an avg consumer which I would argue isnt doing dcf models on their retirement plan

Assist me - yes Make the decision - no Autonomously handle my finance - hell no

Sometimes feels like its just generating really specific and personalised articles/blogPosts for me rather than handling any decisions or taking any load off me.

LLMs? No. 85% correctness and avcuracy — even 95% — is just not going to cut it in that context.

it seems that if you have a local LLM processing your finances, it should be safe and accurate. perhaps my finance knowledge is lacking, but it seems pretty straightdforward that AI would excel at.

Not with my money. No way.

I think that AI can provide very low value on average people that does personal finance.

Reply on news.ycombinator.com