If you are over 60 and still working, exploring everything ChatGPT can do may just help you retire. This is because ChatGPT is a valuable tool to ask questions, learn about different investment strategies and understand common financial pitfalls.
Todd Steam, CEO and founder of The Money Manual, says, “A useful way to use ChatGPT for beginner financial advice is to ask it to explain concepts to a 10-year-old. For example, prompt it to: ‘Explain dividend investing to a 10-year-old.’ The output it gave me was an analogy to supporting a friend’s lemonade stand.
“Another useful way to use ChatGPT is to prompt it to give you a table of pros and sons. For example: ‘Make a table of pros and cons of dividend investing.’ The result I received was a nice summary in an easy-to-read chart.”
It is important to remember that ChatGPT has only been trained up until the end of 2021, so any changes to financial rules and regulations after this date won’t be included in its answers. Here are some prompts to get you started — always remember to tweak with specific details to get maximum results.
1. Generate an Investment Strategy for Creating Wealth
Using AI to learn and make investments is becoming an increasingly popular choice. According to eToro analysis, 43% of American investors believe AI is the future of investing, and 46% use ChatGPT to pick investments because it saves them time on research.
Callie Cox, U.S. investment analyst at eToro, says investors see AI as a resource for their strategies, as well as a potential replacement for portfolio managers and financial advisors. The latter scenario may not be too far off, either. “We already have robot portfolios, and AI may reach a point where it can be a decent guide for the average American’s financial situation,” she remarked.
ChatGPT prompt: How can I determine an appropriate investment strategy to accelerate my retirement income?
ChatGPT response: Determining an appropriate investment strategy to accelerate your retirement income involves careful consideration of various factors. Here’s a step-by-step approach to help you:
- Set clear retirement income goals and assess your risk tolerance.
- Understand your time horizon and when you plan to start drawing retirement income.
- Diversify your investments across different asset classes and consider international diversification.
- Balance your risk-return profile by combining growth-oriented investments with income-generating assets.
- Seek professional advice from a financial advisor or investment professional.
- Regularly monitor and adjust your investment portfolio to align with your goals and market conditions.
2. Develop a Savings Plan for Your Lifestyle
ChatGPT can also offer a savings plan to help you achieve your retirement goals. According to Jenna Biancavilla, founder of Pearl Capital Management, “AI is proficient at delivering fundamental advice used as established rules of thumb commonly used by financial advisors.”
ChatGPT prompt: I have a limited time frame to save for retirement, what steps should I take to maximize my savings potential?
ChatGPT response: When you have a limited time frame to save for your retirement, it’s crucial to take proactive steps to maximize your savings potential. Here are some steps you can take:
- Save aggressively and consistently, allocating a higher percentage of your income to retirement.
- Take advantage of employer-sponsored retirement plans and consider opening an IRA.
- Optimize your investment strategy based on your risk tolerance and time horizon.
- Maximize your income potential through negotiation, side jobs or professional development.
- Minimize expenses and live frugally by reviewing your budget and cutting back on nonessential spending.
- Seek professional advice from a financial advisor specializing in retirement planning.
- Stay focused and disciplined, avoiding premature withdrawals from retirement accounts.
3. Get Resources for Continued Learning and Knowledge
Jason Mountford, market trend analyst at Q.ai, says sometimes “we don’t know what we don’t know” and a large language model, such as ChatGPT, can be a great help. You can talk to it in your own words, explaining your financial problems and what you’re trying to fix with your finances. You can then ask ChatGPT to point you to legitimate sources of information or provide you with the right terminology to use in your broader search.
ChatGPT prompt: What resources can I use to manage my debt while prioritizing retirement savings?
ChatGPT response: To effectively manage your debt while prioritizing saving, here are some resources you can use:
Personal finance books:
- “The Total Money Makeover” by Dave Ramsey
- “I Will Teach You to Be Rich” by Ramit Sethi
- “Debt-Free Forever” by Gail Vaz-Oxlade
Financial education websites:
- Mint (www.mint.com) for budgeting tools and resources.
- National Foundation for Credit Counseling (www.nfcc.org) for education and debt management assistance.
Debt repayment apps and tools:
- Undebt. it (www.undebt.it) for creating and tracking debt repayment plans.
- Debt Payoff Planner (available on iOS and Android) for organizing and paying off debt.
Debt management organizations:
- National Foundation for Credit Counseling (www.nfcc.org) for counseling, education and debt management plans.
- Consumer Credit Counseling Service (CCCS) for debt counseling and financial education.
Online communities and forums:
- Reddit’s personal finance subreddit (www.reddit.com/r/personalfinance) for advice, experiences and resources.
- MoneySavingExpert forums (forums.moneysavingexpert.com) for debt management strategies and support.
Financial apps for budgeting and expense tracking:
- Mint, YNAB, Personal Capital and PocketGuard for budgeting, expense tracking and debt management.
Credit counseling agencies:
- Nonprofit credit counseling agencies for guidance, debt management plans and negotiations with creditors.
Professional financial advice:
- Consult a financial advisor or certified financial planner (CFP) for personalized guidance.
Can ChatGPT Really Help You Retire?
ChatGPT can be a great resource if you are looking for financial or investing information and want to start learning how to better manage your money. This works if you need less of a hands-on approach and more of a nudge in the right direction to prioritize retirement.
However, Kendall Meade, financial planner at SoFi, says, “If you are looking for specific advice, such as ‘Am I on track for retirement?’ then I recommend reaching out to a financial planner. A financial planner can run a comprehensive financial plan. This involves looking at your specific financials and goals to determine if you are on track for requirements.”
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