You may ask if artificial intelligence (AI), such as ChatGPT, can be beneficial to guide your money management activities and financial decisions. AI is assisting students and others with everything from identifying research topics and preparing reading summaries to creating recipes and translating foreign languages.

ChatGPT and similar platforms are designed to understand and respond to questions and creative inquiries. When asked a question or given a prompt, a reply is generated based on the previous learning of the AI program.

Using ChatGPT for personal finance can provide a person with easy-to-understand information as well as suggested money actions related to budgeting, saving, and investing.  However, beware not to depend completely on AI advice since:

• responses may contain fictionalized information or a biased point of view.
• results can produce grammatically correct text but with flawed logic or facts.
• up-to-date tax information and current financial data may be lacking.
• citations may not be correct and may include made-up sources.
• calculations may lack accuracy due to limited math algorithms.

ChatGPT and similar AI programs can be useful in your personal financial planning with:

1. Understanding basic financial concepts.  As a starting point, ask how to improve financial literacy and inquire about fundamental personal finance topics related to budgeting, debt, insurance, and investing.  If a response is too complex for your current level of understanding, ask for a simplified explanation. Or, if a response is too general, resubmit your inquiry with more specific parameters.
   Sample ChatGPT prompt: What advice from financial planners might be the basis of wise money management?

2. Tracking spending and budgeting. Controlling your finances and knowing where your money is going are the foundation of financial success. Creating a budget (spending plan) allows you to tell your money where it needs to go. ChatGPT can suggest appropriate budget categories and amounts as well as possible adjustments when needed. Other AI uses may include use of the 50/30/20 budget rule and guidelines for using the envelope method or budgeting apps.
Sample ChatGPT prompt: What budget categories and allocated amounts are recommended for a household of four people with an income of $67,000?

One person’s experience with creating a budget using Chat GPT may be viewed at:  https://www.youtube.com/watch?v=hl6pOtaSMR4

3. Monitoring and improving your credit score.  Your credit score can influence many aspects of your financial life. ChatGPT is available to suggest actions for improving a credit score. Also of value would be information on how to dispute errors in a credit report.
Sample ChatGPT prompt: Propose a plan to pay off $6,400 of credit card debt.

4. Achieving savings goals. Long-term financial success is dependent on saving money.  ChatGPT can recommend financial goals based on your life situation and finances. In addition, ask for an explanation of compound interest and how it applies to your savings plan.
Sample ChatGPT prompt: Recommend a step-by-step action plan to create an emergency fund of $8,000 within the next two years.

5. Investment advice and retirement planning.  The array of investment vehicles overwhelms most people. ChatGPT can explain stocks, bonds, exchange-traded funds, cryptocurrencies, derivatives, and others in simple terms.  For long-term investing, retirement planning options and estimated future living needs can be the basis for suggested savings amounts.
Sample ChatGPT prompt: Propose a diversified investment portfolio for a 30-year-old person with plans to retire in 35 years.

6. Preparing for filing your taxes. To overcome the intimidation associated with taxes, ChatGPT is available to remind you of deductions, tax credits, and needed documents for your financial situation. AI can also guide you with the best sources for filing your taxes. 
Sample ChatGPT prompt: What is the difference between tax-deferred income and tax-exempt income?

7. Wise spending and shopping suggestions. Guidance for buying can range from meal planning and shopping location to coupon sources and travel schedules. The suggestions offered can prevent overspending through carefully planned buying.
Sample ChatGPT prompt: Create a one-week grocery shopping list of nutritious foods for three people with a weekly food budget of $160.

For the Personal Finance classroom, consider using ChatGPT to:

• Obtain creative in-class activities and field research projects.
• Generate discussion prompts and questions.
• Develop rubrics to evaluate assignments.
• Create assessments and quizzes.
• Implement state and national curriculum standards.
• Construct trivia questions and classroom games.
• Suggest ideas for skits or role-play scenarios.
• Create personalized writing prompts based on student interests and abilities.
• Use as a personal tutor to explain complex concepts or calculations

Will AI create wiser consumers and more effective money managers?  Yes, but only if a person follows the advice offered after carefully considering the validity of the suggestions.

For additional information on ChatGPT for money management, go to:

Link #1

Link #2

Teaching Suggestions

• Have students talk to others about how they might use ChatGPT and other AI platforms to increase their financial literacy.
• Have students research alternatives to ChatGPT and obtain reviews to determine other AI platforms they might consider.

Discussion Questions 

1. What benefits and concerns are associated with ChatGPT and other AI platforms?
2. Describe actions that might be taken to verify the responses received when using AI.