Most of us take artificial intelligence (or AI) for granted without understanding just how commonplace it has become in our lives.

Billions across the globe each day interact with Alexa, Siri, Google’s all-powerful search engine, and all those chatbots that are quick to greet you when you shop online or pay your speeding ticket. Many too are experimenting with AI driven natural language processing (NLP) tools such as ChatGPT – AI tech that enables computers to communicate more like humans. And that’s just a small sampling of what AI now offers and what it may promise for the future.

What Is Artificial Intelligence, and What Brings It to Life?

To quote the New York Times, “Think of a spreadsheet on steroids, trained on big data.”

Big data, for the record, is just a fancy term to describe everyone’s entire digital footprint — spending and travel habits, internet and smartphone usage, tweets and Facebook posts … In short, everything — so beware.

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AI comes in two forms. Most of us have encountered applied AI, such as a computer program that plays chess or your local ATM. Some call that automation.

But the AI that gets everyone all excited seeks to replace human decision-making. This is what we call “machine learning.”

An AI application can learn from examples, patterns, and reams of data to predict future outcomes and to independently perform tasks without being programmed to do so. And assemble information and communicate much like a human, using NLP.

What is AI’s Potential?

Today’s explosion in AI innovation follows in the footsteps of the internet and social-media revolutions. But AI will be so much bigger, more meaningful, and more transformative. To me, AI’s greatest benefit will be in health care — combating diseases and delivering services super-effectively. Space travel and terrestrial transportation remain ripe for AI innovation, too.

What Does AI Mean for Your Money?

For most of this column’s readers, that’s the top-of-mind question. But some tech startups are looking to take this growing field of personal financial management to a whole new level.

For instance, some firms are working on applications that would use your digital footprint (remember big data?) to create a kind of avatar of you as a saver and spender. That avatar would act as your personal-finance coach to help you make smart money decisions.

Think about it: Your AI mini-me working 24/7 tracking and budgeting your money, or negotiating the best deals with banks, insurers, and other service providers. And an AI mini-me could decide on its own to switch your services after finding better deals.

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What Does It Mean for Investors?

AI has already found a comfortable home in the investing world.

Those rich suits on Wall Street use it to figure what stocks to buy and sell — again by tapping into the power of big data.

Machines also assist investors in managing their investments. This AI technology has been aptly named the “robo-adviser” — a hybrid of robot and financial adviser (the human who manages money). Millennial investors love robo-advisers because they know the robot won’t steal their money. Plus, robots are cheap compared to what humans charge for the same work.

What Does It Mean for Entrepreneurs and Businesses?

The robo-adviser’s rise has spawned the formation of dozens of new companies, as well as new jobs and business opportunities.

It's also part of another big technology movement: fintech. This is a catchall phrase to describe the firms that are applying AI to help businesses troubleshoot obstacles and operate more efficiently.

What’s the Downside? Is AI Too Good to be True?

As I just noted, AI innovation is unleashing new companies, careers, and investment opportunities. Yes, AI will eliminate many low-skill jobs and end up automating lots of others. But they said television would kill radio, and radio is still kicking butt.

Okay, so AI does have a dark side. Will it grow so smart that it eventually enslaves us? No. That’s Hollywood nonsense, as Hollywood delights in offering up scripts about psychopathic robots. But still, computers can malfunction.

And some kinds of AI, such as NLP, are both expensive and potentially environmentally harmful due to the sheer amount of energy they require.

The biggest complaints revolve around privacy and security. Big data, when used properly, has the power to make our lives easier. But the government can get their paws on the data, as can criminals.

Why Artificial Intelligence Should be Your Friend

Overall, AI is not a threat. It gives us an edge. Do your research so that you can understand how to use it to your advantage when it comes to spending, investing, or even creating and running a business.

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