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Budgeting trend young Aussies are using to help them become millionaires

Sydney resident Lou recently used ChatGPT to help her budget but said there were risks to be aware of.

Tamika Seeto
·Finance Reporter
·4-min read
Lou and money
22-year-old Lou said she recently asked ChatGPT to create a budget so she could become a millionaire by 40. (Source: Supplied/Getty)

Young Aussies are turning to artificial intelligence (AI) to help them with their finances. New research found a quarter of Aussies had already used AI for financial decisions, while three-quarters were willing to use it to budget.

Sydney resident Lou recently used ChatGPT to get advice on how to become a millionaire by the time she turns 40. The 22-year-old uni student and tech worker told Yahoo Finance she was “surprised” by how useful the tips were.

“It was nothing I didn’t know about before but the advice was to keep budgeting and I already budget quite a bit of income into my investments, to reduce my spending on food and discretionary spending, and to invest in index funds like the S&P 500,” she said.

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For August, Lou shared she had budgeted $2,722 for her mortgage repayments, $1,200 for her strata, $362 for utilities, $506 for dining out, $181 for shopping, $315 for health, $66 for transport, $125 for beauty and $4,000 for investments.

When she entered her income and expenses into ChatGPT, it recommended that she cut certain discretionary spending including cutting dining out from $506 to $400 a month, shopping from $181 to $150 a month, and beauty from $125 to $100 a month, saving her $162 a month.

ChatGPT also said she should continue to invest $4,000 a month and told her this was an “excellent strategy for building wealth”.

While Lou said she wasn’t planning on following ChatGPT’s advice, she said it could be a good starting point for Aussies who were working out their budgets.

“I’m still young so I want to go out with friends and shop. I’m just a 22-year-old girl. But I do recommend it to people who have no idea where to start with finances,” Lou told Yahoo Finance.

“I believe it is a pretty good baseline and then use it as a starting point to do your own research on top of that. I wouldn’t just take it and run with it.

“Before you invest in anything, make sure you do your research because finance is tricky and it can go up and down so I wouldn’t trust AI 100 per cent, but just as a starting point.”

Do you have a story to share? Contact tamika.seeto@yahooinc.com

Research from Compare Club found younger people aged 18 to 44 were more likely to adopt AI for financial tasks, along with men and higher-income groups.

ChatGPT was the leading platform, used by 80 per cent of those who had used AI for their finances, with Bing AI and Gemini also popular.

Compare Club head of research Kate Browne said people were looking for ways to save without spending thousands of dollars on financial advice. But she said there were risks to be aware of.

“While it’s clear that Australians are increasingly turning to AI for help wrangling their finances, the accuracy of the information remains a critical factor,” she warned.

“AI can generate misinformation or may not distinguish between advice suitable for a US or UK market and advice with different rules and regulations. You always need to check the source and the information provided.”

Lou shared a video about using ChatGPT to budget and it seemed to hit a nerve with many other young Aussies keen to try it out too.

“Never thought to ask this, just did and I'm excited to get started,” one wrote.

“You can also plug in whatever groceries you have and ChatGPT will create meal plans for you. It definitely helps,” another said.

Others said they had tried it but the advice they received wasn’t that helpful.

“Mine told me to invest half of my wages into the stock market. Babes I live on minimum wage,” one said.

“Told me to get another job,” another wrote.

Lou recommended young Aussies do their own research, including by using government websites like Moneysmart and looking to Australian experts like the Barefoot Investor.

Lou recently bought her first property for $500,000 and said she has a goal of buying a second property by the time she is 40.

“If I’m investing the way that I am right now, I’m on the track to be a millionaire by 40,” she said.

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