AI Retirement Calculator Evolution

Retirement calculators are essential tools for anyone planning their future, yet traditional calculators often fall short. They tend to be either overly complex for new users or too limited to handle anything beyond simple scenarios. Our mission was to develop an AI-powered tool that could overcome these limitations and offer comprehensive, user-friendly retirement planning.

The Vision

The vision was to create an advanced AI retirement calculator designed to understand natural language inputs, guide users in providing accurate and complete data, make smart assumptions to fill data gaps, enhance financial projections with detailed analysis, and offer personalized advice.

Imagine someone beginning their retirement planning journey with a simple input: "I am 33 and want to retire at 65. I earn $60,000 a year and have $30,000 in a 401K."

The objective was to transform this basic information into precise and insightful financial projections and analysis.

The Evolution

1. The Initial AI Chain

Our first attempt was to create a system similar to ChatGPT but with financial planning specific system prompts and augmented knowledge. This system could take initial user queries, ask follow-up questions, or make informed assumptions to fill knowledge gaps. However, its math capabilities were lacking. About half the time, the financial projections were accurate, but the other half resulted in significant errors—what we termed "financial hallucinations."

Large language models (LLMs) are inherently weak at performing complex mathematical calculations, often relying on approximate methods rather than precise equation-based math.

2. Transition to an AI Agent with Reasoning and Calculator Tools

Recognizing that text generation AI struggles with math, we leveraged its strength in coding to develop algorithms for financial calculations. This led us to transition from a simple LLM chain to an agent-based approach. Unlike LLM chains that process input linearly, agents can use a variety of tools alongside LLM requests.

In our case, we integrated reasoning and calculator tools. When a user query is received, the agent determines whether to handle it using the LLM or the calculator tool. For example, if a user asks, "Should I convert my IRA to a Roth IRA?", the LLM provides advice and recommendations. But for a query like, "What is the future value of a $10,000 investment in 10 years at 5% interest?", the agent utilizes the calculator tool to deliver an accurate result.

This agent-based system significantly improved the accuracy of retirement calculations. However, AI's reasoning remained somewhat non-deterministic, especially for complex scenarios involving adjustments for inflation.

3. Incorporating Specific Math Tools

To address the non-deterministic nature of LLMs, we added specific math tools for complex calculations. This included a dedicated tool for calculating retirement projections, complete with time series data such as savings, growth, and yearly income.

Now, the agent, enhanced with additional financial knowledge tools, can review accurate financial projections and provide insightful analysis and personalized recommendations.

Summary

Kaight, our AI retirement calculator, has evolved significantly from its beginnings as a straightforward ChatGPT-style chain. The results are exciting: starting with simple inputs, Kaight can now offer advanced projections and insightful analysis. Whether you're a novice or a seasoned planner, Kaight's user-friendly interface and powerful tools make retirement planning more accessible and accurate than ever before.

You can try Kaight out for free with the invite code: GETLEVELTEN4282