Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions

NerdWallet's Smart Money Podcast

NerdWallet Personal Finance

Business, Education, Investing, How To

4.2 • 665 Ratings

🗓️ 10 March 2025

⏱️ 24 minutes

🔗️ Recording | iTunes | RSS

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Summary

Learn how AI can help you budget, invest, and build financial knowledge. Then, get expert insights on Roth conversions. How can AI help you manage your money? What do you need to know about Roth conversions? Hosts Sean Pyles and Elizabeth Ayoola discuss the rise of AI-powered financial tools and break down the pros and cons of using AI for budgeting, financial education, and investing research. They explore how generative AI, budgeting apps, and robo-advisors can assist with personal finance tasks but also highlight potential risks that come with using the technology, like misinformation and algorithmic bias. Then, investing Nerd Sam Taube joins Sean and Elizabeth to discuss Roth conversions, including how they work, when they make sense, and what tax implications to consider. They cover how to estimate taxes on a conversion, the impact of the pro-rata rule on backdoor Roth IRAs, and strategies to avoid tax complications. Whether you’re curious about AI-driven financial tools or weighing a Roth conversion, this episode provides the insights you need to make smarter money decisions. What Is a Robo-Advisor and Is One Right for You? https://www.nerdwallet.com/article/investing/what-is-a-robo-advisor Federal Income Tax Calculator and Refund Estimator 2024-2025 https://www.nerdwallet.com/calculator/tax-calculator NerdWallet’s roundup of the best financial advisors: https://www.nerdwallet.com/best/investing/financial-advisors In their conversation, the Nerds discuss: how to use AI for budgeting, AI investing tools, robo-advisors, AI for financial planning, AI stock research, how to use ChatGPT for money management, generative AI and finance, Roth conversion taxes, Roth IRA conversion rules, Roth IRA tax implications, backdoor Roth IRA, pro rata rule Roth conversion, traditional IRA vs Roth IRA, Roth conversion strategy, Roth conversion tax brackets, when to do a Roth conversion, backdoor Roth IRA step by step, Roth IRA withdrawal rules, best robo-advisors, AI stock picking, AI for retirement planning, how to avoid taxes on Roth conversion, investing with AI, and AI vs human financial advisors. To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email [email protected]. Like what you hear? Please leave us a review and tell a friend. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:30.6	Hey, Elizabeth, what's the last thing that you used AI to do? Well, I used chat GPT to find Valentine's Day staycation ideas. And I am proud to say that I now
0:42.2	have new date night ideas that I will be taking full credit for. Just kidding, kind of. But honestly,
0:49.9	I also use it to explain how bonds work like I was a five-year-old.
0:57.3	And then I asked it to further explain to me as a visual learner.
0:59.9	Wow, those all sound like really useful applications.
1:02.9	I'll admit that I'm not an AI power user,
1:05.6	largely because I worry about its environmental impact,
1:08.3	but maybe one day I'll use it to plan my life.
1:11.4	This episode will give folks a few tips for how they can use AI to help them manage their money. Welcome to Nerd Wallet's Smart Money Podcast, where you send
1:21.4	us your money questions and we answer them with the help of our genius nerds. I'm Sean Piles.
1:26.4	And I'm Elizabeth Ayola.
1:28.5	This episode, we answer listeners' question about Roth conversions,
1:33.4	which is timely considering tax season is upon us.
1:36.6	But first, let's explore the rapidly evolving and sometimes intimidating world of AI
1:41.9	and whether it's a good idea to use it to help you manage your
1:45.0	finances. So for context that nobody asked for, I recently wrote an article on the topic of AI
1:51.9	for nerdwollet.com, and what I learned along the way was pretty interesting. So I came across an
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