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AI financial advice is surprisingly good, especially if you ask right questions

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Re: AI financial advice is surprisingly good, especially if you ask right questions

#211

Post by jghn »

AussieWog93 wrote: post #98

People in this thread are massively underestimating the level of financial illiteracy in the general population. We've had multiple people try to convince us to set up bank accounts for our kids, so that they could accumulate interest over 18 years. More that tried to convince me to gamble on random pump and dump shitcoins. More still that talked about "investing" in random collectables like Funko Pops or Pokemon car…

It's easy to see why it works though. I know people like this who have made bank with these stupid schemes. Far higher returns than doing things the "right" way.

The problem is you usually only hear from folks like this who are up a gajillion percent on some dumb crypto play, and not from the people who just wasted their life savings.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#212

Post by groundzeros2015 »

swat535 wrote: post #189
groundzeros2015 wrote: post #131

Earlier quoted context omitted.

An advisor gives you emotional support and helps you not fuck it up.

The problem with giving financial advice to people is that many struggle to pay their rent. Telling them to invest in index funds from an ivory tower is laughably misguided of the realistic situation they live in. After they pay their rent and feed themselves, they may have a little left over which they will simply spend on basic pleasures, or simply rack up debt to get by. The financial advice ignores the fact that…

I don’t know what this has to do with financial advisors. People in that situation are not seeking investment advice.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#213

Post by rgbrgb »

I feed live monarch money data to fable to get help with:

1. high level portfolio composition stuff

2. when to rebalance what where

3. what to sell

4. thinking through money moves (e.g. real estate purchase, remodeling, company sale, angel investments)

5. one off transaction questions (e.g. how many times have I used the ATM with card X this month?)

Don't always agree with the answers, but facts are right.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#214

Post by eks391 »

mikeocool wrote: post #115
mschild wrote: post #14

Earlier quoted context omitted.

> Financial advisors and tax accountants Financial advisors giving generic advice, sure. Tax accountants though? I'd be careful. I know the mistakes that llms make when complexity gets involved (especially tax codes and laws) and frankly I don't know enough about them to be able to verify whether what I'm getting out of it makes sense. I could probably verify it with enough research but then I just could so it myself…

Yeah, Claude told me what a great idea converting my LLC to an S Corp would be and how much I would save in taxes. When I asked my accountant about he told me it would actually cost me more, because of NYC taxes S Corps. I didn’t tell Claude I lived NYC, because it didn’t occur to me that it was relevant. I find tax stuff is full stuff like this (often more subtle than where you live).

This is exactly what I found when I was trying to get advice for some business decisions. My friends with businesses all live in different states/jurisdictions, and the biggest takeaway has been that any tax-affecting advice is useless unless it is tailored all the way down to your city.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#215

Post by jedbrooke »

I feel like a “AI answers can be surprisingly good, especially if you ask the right questions” can be applied to almost anything you can do with LLMs. Like the threads a few days ago about Terrance Tao using chatgpt to solve new math. Could I do the same thing with chatgpt? Absolutely not. LLM in the hand of a experienced dev can produce great things, LLM in the hands of some get-rich-quick grifter saying “make me the next facebook please I want to be a billionaire and make no mistakes” is gonna be slop.

It’s almost like the real intelligence was inside us all along

Re: AI financial advice is surprisingly good, especially if you ask right questions

#216

Post by samudrijan »

kristianp wrote: post #136
AussieWog93 wrote: post #98

People in this thread are massively underestimating the level of financial illiteracy in the general population. We've had multiple people try to convince us to set up bank accounts for our kids, so that they could accumulate interest over 18 years. More that tried to convince me to gamble on random pump and dump shitcoins. More still that talked about "investing" in random collectables like Funko Pops or Pokemon car…

We have bank accounts for our kids, currently earning 1.75% because we aren't depositing money every month. If money is deposited it's another 3.3%. I really need to get around to setting up Vanguard for them. Thanks for the reminder!

Look into a 529 college savings plan.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#217

Post by what »

jeffreyrogers wrote: post #175
what wrote: post #168

Earlier quoted context omitted.

Most people here are probably paid too much to contribute to a Roth IRA.

You can convert your 401k to an IRA when you leave an employer. Some employers also offer in service rollovers (I think these mostly have minimum age restrictions on them though)

That’s a traditional IRA, not Roth.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#218

Post by hiddencost »

kristianp wrote: post #136
AussieWog93 wrote: post #98

People in this thread are massively underestimating the level of financial illiteracy in the general population. We've had multiple people try to convince us to set up bank accounts for our kids, so that they could accumulate interest over 18 years. More that tried to convince me to gamble on random pump and dump shitcoins. More still that talked about "investing" in random collectables like Funko Pops or Pokemon car…

We have bank accounts for our kids, currently earning 1.75% because we aren't depositing money every month. If money is deposited it's another 3.3%. I really need to get around to setting up Vanguard for them. Thanks for the reminder!

VTSAX, ASAP.

Inflation is usually estimated at 3% + annually over a long enough time horizon. You're losing money.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#219

Post by hiddencost »

MBCook wrote: post #125
AussieWog93 wrote: post #111

Earlier quoted context omitted.

The banks might pay 3% interest, whereas even non-volatile conservative investments like cap notes or bonds would pay something like 7%. Plugging it into a calculator: 1.03 ^ 18 = 1.70 1.07 ^ 18 = 3.37 Example numbers, but you're effectively taking half of the money that your kid would have had on their 18th birthday, and giving it to a banker.

3% is amazingly good. It’s not hard to beat that, but a savings account at a common bank can easily be below 0.05%. I looked up BoA. 0.04%.

3% is roughly inflation.

Re: AI financial advice is surprisingly good, especially if you ask right questions

#220

Post by hiddencost »

bradfa wrote: post #104
AussieWog93 wrote: post #98

People in this thread are massively underestimating the level of financial illiteracy in the general population. We've had multiple people try to convince us to set up bank accounts for our kids, so that they could accumulate interest over 18 years. More that tried to convince me to gamble on random pump and dump shitcoins. More still that talked about "investing" in random collectables like Funko Pops or Pokemon car…

What’s wrong with bank accounts for your kids? Sorry, this one doesn’t seem to fit with your other examples.

Inflation over a long time horizon is about 3%. Especially if it's going to be a decade or more, just put it in an index fund.
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