Ask a chatbot "should I move my pension?" and you will get a confident answer in seconds. That is exactly the problem. An AI financial advisor that sounds sure of itself can be wrong about your tax, out of date on the rules, or quietly steering you towards a product.
This review sets out what AI money tools can legally do in the UK, the six checks we would run on any of them, and where a human adviser still earns their fee.
Disclosure: Plenence is itself an AI-assisted planning tool, and we say below exactly how it works so you can apply the same checks to us.
What does "AI financial advisor" mean in the UK?
In the UK, "financial advice" means a personal recommendation, such as "transfer this pension" or "buy this fund". Only firms authorised by the Financial Conduct Authority (FCA) can give it, and the firm is responsible for it whether a person or software produces it.
So when an app calls itself an AI financial advisor, ask one question first: is the firm authorised to advise? If it is not, what it gives you is guidance. Guidance can be very useful, but the responsibility for the decision stays with you.
The rules are also shifting. Since 6 April 2026, the FCA has allowed "targeted support", where authorised firms suggest options for groups of customers in similar situations. The FCA expects at least 18 million people could be offered it over the next decade, according to its December 2025 announcement.
Types of AI financial advisor tools compared
| Tool type | What it does | Gives regulated advice? | How it is usually paid |
|---|---|---|---|
| General chatbot | Answers money questions in plain English | No | Subscription or free |
| Robo adviser (UK) | Picks and manages a ready-made portfolio | Yes, for its own investments | Fee on money invested |
| Budgeting or AI money coach app | Tracks spending through open banking | No | Subscription, or commission on products |
| AI financial planner | Models pensions, tax, retirement and estate | Usually no, guidance | Subscription or fee on assets |
| Adviser using AI | A regulated adviser uses software to prepare | Yes | Adviser fees |
Table: Plenence summary, October 2026. Individual products vary; check each firm's own terms and its entry on the FCA Register.
Is AI financial advice safe? Six checks to run
1. Is the firm authorised, and for what?
Search the FCA Register for the firm's name. A robo adviser should show permissions for managing investments or advising. A planning tool that only gives guidance may not be authorised at all, and should say so clearly.
2. Who does the maths?
This is the check most people miss. Large language models are good with words and unreliable with arithmetic. A sound AI financial planner uses ordinary, tested code for every figure, and uses the language model only to explain it.
Ask the tool to show its working. If it cannot show the inputs, the rule and the formula for a number, treat the number as a guess.
3. Are the rules sourced and current?
UK money rules change often. In the next two years alone:
- most unused pensions enter inheritance tax from 6 April 2027
- the cash ISA limit falls to £12,000 for under-65s from 6 April 2027
- the minimum pension age rises to 57 on 6 April 2028
- salary sacrifice National Insurance savings are capped at £2,000 from 6 April 2029
A tool trained on old data may not know any of this. Look for answers that link to GOV.UK, HMRC or the FCA, with a date.
4. What happens to your data?
Your pension statements contain your name, address, National Insurance number and balances. Ask: is it encrypted, is it used to train AI models, which companies process it, and can you delete everything? UK GDPR gives you rights here; a good tool makes them easy.
5. How is it paid?
If an app earns commission when you buy a product, its suggestions may lean towards that product. Look for clear pricing and a statement on commissions and product placement.
6. Does it know when to stop?
A trustworthy tool tells you when a question needs a human, for example a defined benefit transfer over £30,000, which legally requires regulated advice. If an app will happily tell you which fund to buy without being authorised, walk away.
AI vs financial adviser: where each wins
AI tools win on speed, cost and patience. They can re-run your plan every time a rule changes, run 1,000-path Monte Carlo retirement tests in seconds, and never mind a basic question.
Human advisers win on responsibility, judgement in messy situations, and the legal right to give a personal recommendation. They also offer protection: regulated advice comes with access to the Financial Ombudsman.
The demand for both is real. In 2025/26 only 30.8% of people accessing a pension for the first time took regulated advice, according to the FCA's retirement income data. The rest made the decision alone.
"That is why the development of guided retirement solutions could prove so important over the coming years."
David Brooks, Head of Policy, Broadstone, September 2026
A worked example
This is an illustrative example, not a real person.
Raj, 61, asked a general chatbot whether he could afford to retire next year on £400,000. It said yes, assuming 7% growth and no tax. Then he put the same figures into a planning tool that used the FCA's intermediate projection rate, inflation, charges and income tax, and ran to age 100.
The answer changed: his money ran out at 88 if he drew what he wanted. Nothing was hidden; the second tool simply showed its assumptions. He then booked an adviser for one decision, whether to buy an annuity with part of the pot, and arrived with his numbers ready.
Mistakes people make with AI money tools
- Trusting a number without its working. Always ask how a figure was calculated.
- Using a tool with old rules. Check it knows about the 2027 and 2028 changes.
- Uploading documents without reading the data policy. Know who sees your statements.
- Treating guidance as advice. If the tool is not authorised, the decision is yours.
- Skipping a human for irreversible moves. Defined benefit transfers and large estate plans deserve one.
How Plenence answers the six checks
Plenence is an AI financial planner for UK savers. It is not authorised by the FCA and gives guidance, not regulated advice.
- Maths: every figure comes from deterministic, tested code. AI only reads your documents, words answers and checks they stay on the guidance side. An answer containing a figure nobody calculated is not shown. Our methodology explains each model.
- Rules: every allowance and threshold sits in a versioned UK rules dataset, cited to GOV.UK, HMRC, the FCA and others, and checked daily against GOV.UK.
- Data: documents are encrypted before storage, read only by AI providers that neither train on nor retain them, and deleting your account deletes everything.
- Money: no commissions and no product placement. Pricing is a free plan, or Pro at 0.15% a year of monitored assets, from £120 to £1,500.
- Limits: questions asking for a specific product or provider are answered as guidance, and decisions that legally need advice say so.
Want to see the difference shown working makes? Try our free retirement calculator, or read our review of free financial advice for the human options.