Most of us have no idea if our retirement plan is actually any good. Sure, we’re contributing to our 401(k) and maybe we’ve got some vague target numbers floating around in our heads, but is that enough? Will we actually be able to retire comfortably?
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Since professional financial advice can cost hundreds of dollars, I decided to ask ChatGPT to review my retirement strategy. I’m 40, aiming to retire around 67, and have what I thought was a pretty solid plan.
Here’s what ChatGPT had to say when I let it review my retirement plan.
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What ChatGPT Said I’m Doing Right
First, the good news. ChatGPT gave me credit for several smart moves:
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Taking the 401(k) match: “Taking full advantage of your 401(k) match is free money — excellent.” Can’t argue with that logic.
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Saving 10%-15% of income: The AI called this “solid, especially if you started early.” Though as we’ll see, the early part is key.
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Simple investment strategy: My low-cost, diversified funds approach got a thumbs up as “a great default.”
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Planning ahead: ChatGPT liked that I’m thinking about increasing contributions over time and using windfalls for retirement savings.
So far, so good. But then came the reality check.
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Where ChatGPT Says I Need To Step Up
Here’s where things got interesting. ChatGPT didn’t just pat me on the head and send me on my way; it had some serious suggestions for improvement.
First, my savings targets are too low. I was aiming for three times my salary by age 45, which ChatGPT called “a good minimum.” But then it hit me with this: “If you’re behind or started late, try pushing toward 4-5x salary by 45.”
The AI laid out a much more aggressive timeline:
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Age 45: 4x salary
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Age 50: 6x salary
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Age 55: 8x salary
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Age 60: 10x salary
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Age 67: 12-15x salary
That’s significantly higher than what I was planning. Talk about a wake-up call.
Second, I need to save more, period. If I didn’t start saving in my 20s or 30s (guilty), ChatGPT recommended bumping my savings rate to 15%-20% of my income, including employer match. That’s a big jump from my current 10%-15%.
The Tax Strategy I’m Missing
This is where ChatGPT really opened my eyes. I’d been thinking about maybe adding a Roth IRA to the mix, but the AI made it clear it’s important.
“Try to diversify tax exposure,” ChatGPT explained, recommending I fund both a Roth IRA and keep some money in a regular taxable brokerage account. The reason? Flexibility. Having different types of accounts gives you more options for withdrawals and managing taxes in retirement.
I honestly hadn’t thought much about tax diversification, but it makes total sense. Why put all your (financial) eggs in one (tax) basket?
The HSA Game-Changer
Here’s something I completely overlooked: my health savings account. ChatGPT called maxing out an HSA “a powerful triple-tax-advantaged retirement tool.”
Triple tax advantage? That got my attention. Turns out you get a tax deduction when you contribute, tax-free growth and tax-free withdrawals for medical expenses. After age 65, you can withdraw for any reason and just pay regular income tax. This basically makes it another retirement account.
The Lifestyle Creep Warning
ChatGPT also called out something I’ve been guilty of: lifestyle creep. “As income rises, be intentional about directing extra cash to savings, not spending,” the AI warned.
That hit close to home. Every time I get a raise, somehow my expenses seem to magically increase too. The AI was right; I need to be more deliberate about funneling extra income into retirement savings instead of letting it disappear into my day-to-day spending. Goodbye, Starbucks. Hello, Fidelity.
The Bottom Line
ChatGPT’s overall assessment of my retirement plan? The AI thought it was “clear, sensible, and grounded in widely recommended personal finance principles.” But, of course, there’s room for improvement.
The biggest takeaways: I need higher savings targets, better tax diversification and to max out that HSA I’ve been ignoring.
Was it as good as talking to a real financial advisor? Probably not. But for free advice that I could get in 10 minutes, ChatGPT definitely gave me some valuable insights and a solid roadmap for improvement.
Now I just have to figure out where to find that extra 5%-10% of income to save…
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This article originally appeared on GOBankingRates.com: I Let ChatGPT Review My Retirement Plan: Here’s Where It Told Me To Change
