CFP or ChatGPT?

Now that AI tools can serve as everything from wingmen to bedtime story readers, it’s no surprise they’re also becoming guides to budgeting, saving, investing and more. Eighteen percent of adults in the US who sought financial advice in the past year tapped artificial intelligence tools like Claude and ChatGPT, according to a recent survey from Edward Jones and Gallup. Younger Americans are more likely to ask the bots for help: 26% of Gen Z and 25% of millennials have used AI for financial guidance in the past 12 months, compared with just 7% of baby boomers.

But that doesn’t mean people trust a bot more than a human expert. The survey found that 79% of Americans have at least some confidence in financial advisors, including roughly a quarter who have a great deal of confidence in them. On the other hand, only about three in 10 adults have some confidence in AI’s ability to offer financial guidance, and only 3% have a great amount of confidence in it. David Chubak, head of wealth and field management at Edward Jones, said the data points to a more nuanced future where people use multiple sources of guidance.

“Financially fulfilled adults tend to combine their own research, personal networks and professional expertise,” Chubak said.

Bots and Human Beings

So when it comes to financial guidance, we’re likely not going to see people making a choice between artificial intelligence and advisor intelligence:

• There can be a place for AI in financial advice, especially for younger investors at the beginning of the wealth accumulation phase, said Edward Mahaffy, an advisor with ClientFirst Wealth. If its advice is aligned with Vanguard’s asset allocation suggestions, for instance, then it can be a convenient tool to hopefully pique the investor’s interest in a deeper dive. “The danger is in taking AI as gospel without vigilant efforts to verify it,” he added. “This is especially true when one is nearing or already in retirement, where there can be little room for error.”
• “AI can be a great starting point for low-consequence decisions,” said Michael Espinosa, an advisor with TrueNorth Retire. “It can even help people get organized so that their first meeting with their financial advisor goes more smoothly.” But the bigger the stakes, the more important it is to engage with a financial advisor.

Money Talks. The study found that AI use skews somewhat higher among financially stressed adults. “That tells us many people may be looking for accessible ways to get answers and direction,” Chubak said. “But it also reinforces why expanding access to trusted professional guidance remains so important.”

Advisors who don’t work with 401(k) plans might assume the rules applying to investment selection provide long-settled, clear-cut and easy-to-apply guidance.

They would be wrong, according to Bonnie Treichel, founder of Endeavor Retirement and partner at Endeavor Law, despite the fact that 401(k)s have existed since the early 1980s and currently hold some $10 trillion in assets. The reality is that retirement plan regulations are in constant flux, and Treichel is tracking at least three major issues that could significantly affect advisors and plan sponsors in the coming months, including a major Supreme Court case and two potential rule changes from the Department of Labor. Add to that a new wave of litigation challenging financial advisors’ and asset managers’ use of plan participant data to “cross-sell” wealth management services outside the 401(k) and the picture gets even more complicated.

Consulting on 401(k) plan investments is still a great business for advisors, Treichel emphasized, but it requires a willingness to master an ever-changing set of rules and regulations in order to avoid bad outcomes.

Court Cases and Regulations

The US Supreme Court recently agreed to review a case, Anderson v. Intel Corporation Investment Policy Committee, that arose after employees sued Intel for using a default investment option that included private assets as a means of hedging against excessive losses in the plan. The fund in question has lagged behind the S&P 500, Treichel noted, but the plan sponsors didn’t select it to maximize performance. Hence, the Supreme Court is being asked to what extent plaintiffs need to provide a “meaningful benchmark” in order for their performance complaint to clear the motion-to-dismiss stage and reach discovery. Oral arguments are slated for October.

“Anderson v. Intel could have a major impact on fund performance litigation,” Treichel said. “I expect the current Supreme Court is likely to side with Intel and raise the bar for litigation to move forward, but nobody has a crystal ball.”

Separately, the DOL is undergoing two distinct rulemaking processes that could also seriously affect investment selection:

• The first is a broad proposal that would effectively establish legal immunity for retirement plan fiduciaries if they consider a key set of features when picking investment options and document their decisions.
• The second, currently under review by the Office of Management and Budget, will apparently address the inclusion of ESG funds in 401(k) plans.

Data Security. Even if plan fiduciaries get some relief from performance and process-based lawsuits in the near future, another type of case has already emerged in force. “Participants have filed a wave of lawsuits alleging that service providers inappropriately used their data for targeted marketing and cross-selling,” Treichel said. “It’s an important issue for advisors to be aware of as they’re working across retirement plans and wealth management. Transparency and data protection are key.”

If you’ve seen Succession or Knives Out, you know inheritances can turn families into enemies.

Real life is usually less dramatic, but one source of conflict is unequal inheritances, where one heir receives more than others. The share of American parents over age 50 with wills and multiple children who divided their estates unequally increased from about 27% in 1995 to more than 36% in 2014, according to one study published in 2023. Researchers attributed the trend to changing family dynamics, including higher divorce rates, remarriages, cohabitation and nonmarital childbearing. Without clear communication, a decision to leave one heir more than another can lead to resentment, legal disputes and fractured relationships.

For advisors, that creates a delicate balancing act: honoring a client’s wishes while helping families understand the reasoning before disagreements escalate, said James Malatos, founder of Harbor View Private Wealth. He once had a case where a pair of clients left a family property to one child. However, the other children were not privy to that decision, and it took months of mediation to repair relationships that a single conversation years earlier could have preserved. “My rule now is simple: If a decision might surprise an heir, it should never surprise them for the first time in a lawyer’s office,” he told Advisor Upside.

Why’d They Get More?!

It’s the same question children ask on Christmas morning, only decades later and with much higher stakes. There are often legitimate reasons an inheritance isn’t split evenly. “Maybe one child has significant medical needs, another has spent years serving as a caregiver or one has already received substantial financial support during the parents’ lifetime,” said Andrew Fincher, a CFP with VLP Financial Advisors.

The bigger problem is that many families never discuss those decisions:

• About 70% of parents have created a will or estate plan, according to a 2025 Fidelity study.
• Most, however, have not shared inheritance details with their children.

Hey, No Fair. Those conversations are better had sooner rather than later. Explaining why one heir will receive more can give family members time to process the decision and ask questions before emotions are compounded by grief. Once a client dies, there’s often little an advisor can do to repair the underlying hurt, said Mitchell Kraus, owner of Capital Intelligence Associates. “We can explain the documents, help administer the assets fairly and encourage communication, but the person best positioned to explain the decision is no longer there,” he told Advisor Upside. “A difficult conversation today can prevent an all-out family war later.”