AI can make your money work for you

The way we thought of apps back in 2008 is how we’ll view artificial intelligence five years from now; 2016 will look like the AI stone age.

Although apps have created completely new behaviors, especially in the fintech space with mobile banking and shared payments, the app economy, unfortunately, seems to be reaching a peak, and monetizing an app has become an uphill battle.

Apps will be the technology of the past, ushering in a new era for AI. Bots today are merely app replacements or novelties, and the experience still feels like talking to a robot. But with bots eventually becoming smarter than today’s apps, they’ll inevitably solve the problems that apps cannot fix in entirely new ways that haven’t even been realized yet.

Let’s take a look ahead. In the future, for example, bots, and AI in general, will help you make money off your checking account.

Did you know that extra cash in your checking account is a missed opportunity? Every day, it loses value to inflation. To generate better returns, you could keep the bare minimum in your checking account and invest the rest. However, unexpected expenses can drain your account suddenly. Without extra cushioning in your checking account, you risk getting slapped with bank fees or credit card debt that quickly cancel out any gains from your investments.

AI will enable us to increase our wealth while decreasing our anxiety.

It feels like you can’t win. Either you’re missing out on capital gains, or you’re playing limbo with your account balance. AI will make this struggle a thing of the past.

Advances in AI will create a robo-accountant that knows your spending better than you do. By analyzing your purchase history, it will constantly move money between your checking, savings, investments and credit cards. This way, your checking account’s balance is always in the narrow “sweet spot:” high enough to avoid fees, but not so high that you miss out on investment yield.

Right now, finding that sweet spot is time-consuming and anxiety-inducing. In time, the robo-accountant will know when you’re likely to splurge. It will know when your car will need a repair, when your electric bill will spike. It will know when you’re actually better off carrying a balance on your credit card than paying your bank’s minimum-balance fee.

A fee-minimizer/yield-optimizer could exist without AI, but it wouldn’t work that well. AI incorporates the ability to make complex judgments based on your history of spending habits, the fees from your various financial institutions and countless other factors. This is the crucial link that makes the product useful: It plans ahead so you don’t have to.

Your robo-accountant will take everything into consideration to make sure you get the most yield from your money while minimizing the fees you pay across the board. AI will enable us to increase our wealth while decreasing our anxiety. Given that more than 60 percent of Americans worry about missing their retirement goals, this is no small feat.