Four in five young investors have already used AI to help them make financial decisions. More than half trust it more than television, newspapers or ‘finfluencers,’ and two-thirds expect to use it even more over the next year.
None of that in the FCA’s research is especially surprising. AI is fast, free and increasingly good at sounding confident about complicated things. If you’re trying to work out what to do with your savings, why wouldn’t you ask?
The more interesting part is actually buried lower down in the research.
The footnote nobody read
“General purpose AI tools are not regulated by the FCA,” it says. “These tools can respond to a variety of prompts and topics but aren't set up to help consumers with financial advice, research, or decision-making.”
That’s quite a caveat to leave in the small print.
Forty-four per cent of the people the FCA surveyed already believe AI-generated financial information is regulated. Thirty-eight per cent think it is fine to act on it alone, without getting a second opinion.
Both numbers are in the same release, yet only one side of that story made the headline.
Why AI is making investors rethink this market
I've had versions of this conversation with more than one investor over the past year and I think the FCA's data helps explain something a few of them were reluctant to say outright.
If a free chatbot can give a convincing answer to “what should I do with my money?”, why does anyone need a company like Prosper?
A well-regarded venture fund passed on backing anything in our space last year for more or less that reason. It’s a fair question insomuch as there are parts of financial services that AI will make look expensive and unnecessarily complicated. But I don't personally think that settles it.
For one, regulation gives you some things that become important very quickly when real money is involved.
Someone has to keep your ISA money safe and handle the trades. Someone should notice before an irreversible decision wrecks your tax position. If something goes wrong, there needs to be somewhere for the complaint to go other than a support inbox. And, for plenty of people, there’s value in simply knowing that the firm they’re trusting with their savings is licensed to do the job.
A chatbot gives you none of that, which won’t necessarily stop people using it but I suspect a large share of the population will end up with a basic broker account alongside a chatbot and never feel the need for much more.
For quite a while, that may work perfectly well.
Where I think it all breaks
Through much of your working life, it’s hard to know whether financial advice was good.
Decent advice and mediocre advice can produce results that look remarkably similar when you're 30, investing every month and markets are generally rising over the long term.
There’ll be obvious disasters — the single stock that goes to zero, the memecoin that never comes back — but most mistakes are much less visible.
The difference probably becomes clearer when people start drawing money out rather than putting it in. Then the question is no longer simply whether you saved enough, but whether the money you have can support the life you have left.
That’s where small mistakes compound differently: a withdrawal rate that looked fine until it didn't, a portfolio that nobody rebalanced, tax decisions that can’t be undone, someone in their late 70s looking at the number in the account and realising it may be smaller than the number of years ahead of them. The list goes on.
At that point, people will want to know who was responsible for the advice they followed.
A chatbot cannot be struck off, sued or sent to prison. The people who built the model will be several steps removed from the individual answer and the FCA will quite reasonably say it never regulated the tool in the first place.
But by then, “we said so in the footnote” may not feel like much of an answer…
This article is for informational purposes only and does not constitute personal financial advice. If you are unsure whether an investment is right for you, please seek regulated financial advice.
Sources: FCA press release, 27 August 2026, “Young investors trust AI more than TV or celebrities” – https://www.fca.org.uk/news/press-releases/young-investors-trust-ai-more-tv-or-celebrities