Khushi Mishra, 25, was just starting to earn when she opened her Demat account. She didn’t know what to do. She was overwhelmed by the terminology — mutual funds, SIPs and mid-caps — that no one had ever explained to her. So she did what many of her generation do instinctively: she asked an AI chatbot to simplify everything. “I remember there were days I would ask AI to — in detail — tell me about these funds as my bedtime stories,” Mishra, now 27, tells indianexpress.com.Mishra is not alone. The bedtime story investorFor Mishra the appeal of AI was not just convenience, but the freedom from judgement. She admits that she used to be shy about asking a friend for help with her Rs 5,000 investment because people around her had a lot of money. Asking a parent was a minefield of emotions. And a financial adviser? She says, “I don’t think I can afford a good financial advisor yet.” What AI offered her was an always-available, patient guide with no ego or fee. She could ask the exact same question in different ways and get clear answers every time. Story continues below this advertisement. If millions of users ask the same AI prompts, it can lead them to the same trades and themes, increasing crowding risk. (Source: Freepik). Over time, she went from understanding basic terms to comparing mutual funds and evaluating them based on their five-year returns. She then built what she calls a “balanced portfolio” of stocks using AI’s advice on diversification. I have invested using AI but I take the time to think about it,” she added.Quick and easy, but non-judgmentalMoni Shadilya, a 26-year-old consultant at One Source uses AI in a different way but is still driven by the same impulse. Shandilya uses it primarily to track spending, manage small savings and split a budget with friends. I can ask at any time without feeling judged. She says that sometimes it’s easier to ask AI, especially for basic questions or’silly,’ than to ask people. Story continues below this ad.She recalls an instance when she followed AI’s advice on splitting savings while planning a trip with a group, putting aside a portion of her savings for a potential emergency. She went along with the logic because it made sense and she felt that it was a low-risk decision. But when it came to stocks she was more cautious. She says, “I was not fully confident and I wanted human input so I asked my dad later.” The pattern is clear: AI for everyday, humans for high-stakes. Avirup Nag is even more circumspect. He uses AI to set savings goals based on his income and to plan travel budgets. Story continues below this ad. “I have never sought such financial guidance from AI. “I would rather discuss with family or friends before investing,” says the professional. “AI isn’t for business investments, it’s for corporate employees that have to spend their money wisely each month.” What experts sayFinancial professional aren’t dismissing AI, but are aware of its limitations. Adhil Shetty CEO of BankBazaar sees AI as useful for “everyday” financial awareness, such as understanding credit scores, comparing product, or decoding financial terminology. Eight percent of Gen Z users report that they have suffered direct financial losses due to over-reliance on AI tools. Story continues below this adAI also has made young investors more opinionated, and sometimes overconfident. (Source: Freepik).Kshitij Takkar, founder MTrust Investments identifies a more subtle danger: false trust built on incomplete understanding. “AI provides crisp, convincing responses, without conveying uncertainties, assumptions, limitations, or uncertainty.” Thakkar warns that this can blur the lines between information and advice for young investors. He also highlights what he calls “herd amplification”. If millions of users are asking similar AI prompts, then they could be funneled into the same trades and themes, increasing crowding risk. AI tools are not accountable for the outcomes, unlike advisors regulated by the Securities and Exchange Board of India. The experts note a trend: being more informed about finances doesn’t always lead to better financial decisions. Story continues below this adShetty claims that Gen Z users have the lowest financial attainment of all age groups. “Using these tools have not yet led to achieving your financial goals,” he says. The gap between information and actions, between understanding what an SIP is and actually adhering to one during a market decline, is still a very human problem. They come to consultations with their AI homework done, model portfolios and tax strategies in hand. Their questions are also sharper. He observes that this shortens the educational phase and shifts the conversation to validation, refinement and risk calibration instead of basic guidance. Story continues below this advertisementIn some ways AI has made Gen Z clients better, not fewer. But there is also a flipside. AI has also made younger investors more opinionated, and at times overconfident. Advisors have to spend more time correcting their assumptions. “Gen Z doesn’t replace advisors with AI. Thakkar explains that they’re redefining advisors’ roles from teacher to strategic partners. He says that people have avoided financial advisors because of two main reasons for a long time: cost and lack of trust. AI is a solution to both. He cautions against the notion Gen Z is particularly vulnerable to AI-driven false information. “It isn’t Gen Z that is at greatest risk.” He says older people are more likely to accept the answers as true. Story continues below this adHis two children, both Gen Zs had access AI through their university education and are better equipped, he believes, than most of their senior peers “to use and criticize its responses.” Cost, however, remains a barrier. For Mishra and other young earners, investing their first Rs. 5,000 is out of reach. Keith acknowledges that this is the case, noting a hybrid model where advisors use AI to offer more options. But for Gen Z, such services will likely be out of reach for several years. She knows her portfolio much better than she expected at 25. She is honest about what AI can’t do. “AI won’t be affected if I lost all my money – it could give me incorrect data and it has nothing at stake,” she says. “On the contrary, someone with experience will be able to understand the same.” She concludes her essay with a list of wishes for the future. Shetty agrees. “I think AI is a great way to learn, but one day I’d like a good financial advisor.” “Use AI for information, but verify it before you act.” In the end, both AI, and the young investor, are still learning. They just do so at different speeds and stakes. Before making any financial decisions, readers should consult a qualified financial advisor, planner, or mental health specialist.
