Retirement Planning With ChatGPT: 10 Prompts To Try To Get a Real Answer You Can Use
Written by
John Csiszar
Edited by
Jenna Klaverweiden
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ChatGPT is rapidly becoming a popular resource for retirement planning, and for good reason. The artificial intelligence (AI) bot is easy to use, free of charge, and great at gathering information and performing calculations. The problem is that ChatGPT is only as good as the inputs it is given. If you don’t know what information to ask for, you’re not going to get an answer that’s helpful.
Here’s a list of things you should be aware of regarding ChatGPT’s retirement planning abilities, followed by a list of prompts you can use to get real, viable answers from the service.
Also see ChatGPT’s top five money moves every retiree should make now.
Garbage In, Garbage Out
Like all computing systems, ChatGPT can work only with the information and direction you provide it. While the AI bot is good at math and projections, most people don’t know how to input all the necessary variables needed to get a viable answer. As the slightest tweak in a retirement projection can turn a fully funded retirement into a nightmare scenario, it’s essential to get all the information correct.
While you can ask ChatGPT simple questions like, “How long will my money last in retirement?” it’s essentially going to make up that answer unless you give it real-world information. Here are some of the many inputs that a good financial advisor would include when drafting a retirement planning scenario.
- Your age
- Number of children
- The expected rate of inflation both before and after retirement
- Your projected investment return
- Your income and expenses both before and after retirement
- Your overall health and anticipated longevity
- Other financial goals, such as funding a college education
- Your Social Security projections
- Income from other sources, such as potential inheritances
- Your tolerance for risk
- Whether you plan to leave money behind or die with zero assets
- Your tax bracket both before and after retirement
- Your insurance coverage
This is just the tip of the iceberg when it comes to setting up a retirement projection. A good financial advisor will also factor in many other variables and account for various risks, such as the sequence of returns risk. This is why, for most people, it still makes sense to work with a fiduciary financial advisor, even if you can draft a quick and easy retirement plan using ChatGPT.
Which Prompts Actually Work With ChatGPT?
The best way to get reliable information out of ChatGPT when it comes to retirement planning is to provide it with as much information as possible. The list above is a good start when it comes to determining what variables can help ChatGPT provide a substantive, real-world answer.
The bot itself is actually good at outlining its strengths and weaknesses, noting that, “While ChatGPT can’t predict the stock market or give you personalized legal advice, it can clarify rules, run comparisons and help you stress-test your ideas. The key is being specific with your prompts: include your age, income needs, city or account type. The more detail you provide, the more practical the response will be.”
With that in mind, here’s a list of prompts that can generate useful responses from ChatGPT:
- “Estimate how much I’ll need to retire at [age], spending [$X] per month.”
- “Compare the tax treatment of withdrawing from a Roth IRA vs. a traditional IRA in [my state].”
- “If I delay Social Security until age 70, how much more will I receive compared with starting at 62?”
- “Build a sample retirement budget for someone with [$X] monthly income in [city/country].”
- “What are the average healthcare costs in retirement, and how can I prepare?”
- “Show me a sample investment portfolio for a conservative/moderate/aggressive retiree.”
- “Explain how required minimum distributions (RMDs) work starting at age [X].”
- “Compare the cost of retiring in [City A] vs. [City B] with [$X] per month.”
- “Create a step-by-step retirement planning checklist for someone age [X].”
- “Give me strategies to reduce taxes on my retirement income.”
Note that in most cases, these questions are just the starting point of your retirement planning journey. With all of these questions, will you have to provide follow-up information to continue the discussion with ChatGPT. But that’s valuable in and of itself, as the more data you give the AI bot, the more the answers will be tailored to your unique financial situation.
In the case of more general prompts, like “Give me strategies to reduce taxes,” ChatGPT will provide you with broad, basic options that you should then discuss with your tax professional. But this information is also valuable, as you can use it to be prepared for your meeting and save both time and money.
The Bottom Line
ChatGPT isn’t capable of providing the type of personalized, comprehensive retirement plan that a human advisor can. But if you provide it with the right information — and ask it the right questions — you can at least put in place the basic building blocks needed to construct a financial plan.
Just remember that, by its own admission, ChatGPT sometimes “hallucinates” and makes up an entirely inappropriate or inaccurate answer. When it comes to retirement planning, those types of errors can be catastrophic. This is why it’s always best to independently verify anything ChatGPT tells you about your retirement plan, ideally with a fiduciary financial advisor.
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