Can Financial Planning Tools & AI Shape Your Future?

Artificial Intelligence (AI) – by now, we’ve all heard of it. Some readers are using generative AI tools like ChatGPT. Others are familiar with the high-flying AI stocks that pushed the market to new highs in 2024.

The reality is that AI has been around for a long time, particularly in the financial world. Leading financial planning software platforms have leveraged Artificial Intelligence for years to improve speed and accuracy, and our preferred software solutions are no exception.

What is financial planning software?

Financial planning software generates projections based on an individual’s circumstances and goals. Key inputs include income, assets, debts, and spending plans. Just as important are the qualitative factors that shape financial decisions – retirement timing, life expectancy, and estate planning objectives.

Using this information, the planning software models long-term scenarios, creating a foundation for discussion, action, and adjustment in a person’s financial journey.

What questions can financial planning software answer?

The main purpose is to address an age-old question – Will I run out of money? While this question is a valid starting point, our planning exercises often dig much deeper. Below are several questions I’ve answered for clients in recent weeks:

• When can I retire?
• How much can I afford to spend?
• Can I purchase a vacation home?
• Can I leave a legacy for my children?
• Do my investments align with my planning needs?

A second, but valuable, component to the process is the stress test. This exercise evaluates how a plan might perform if markets struggle. It also can evaluate the risk of disability, premature death, and long-term care costs at the end of life.

Does AI Enhance Financial Planning?

AI and machine learning are essential components of modern financial planning software, often operating behind the scenes. Our platform, for example, uses machine learning to categorize complex financial transactions automatically. Other AI-driven tools analyze risk exposure, spending patterns, and economic conditions.

What are the risks and limitations?

Financial planning software is informative but not predictive—its projections are only as reliable as the inputs provided. Even small changes in return expectations, spending goals, or income levels can significantly impact outcomes.

Ultimately, financial planning is a human-driven process. Advisors and clients must regularly review assumptions and maintain clear communication. Personal values, preferences, and fears should remain front-and-center no matter what. The real power of financial planning lies in the collaborative discussions that take place after the numbers are crunched.

How do I get started?

BaldwinClarke’s planning program boasts over fifty years of experience. Our technological strides mark the next chapter in this history. Please feel free to contact me for a relaxed, introductory planning discussion at BryceSchuler@BaldwinClarke.com or 603-206-3746.