Retirement Calculators Are Broken – Can AI Fix Them?

The retirement equation has changed.

Since July 1, 2022, the retirement income covenant has shifted the focus of superannuation funds. It's no longer just about helping members grow their savings during the accumulation phase — now, there's a mandate to help them make sense of life after work.

But there's a problem: Retirement is complicated, and many Australians aren't getting the help they need.

The advice gap is real

For many Australians, the transition to retirement feels like stepping off a cliff with complex rules, inconsistent information and no clear roadmap. The lack of financial advice is driven by:

• Shortage of financial advisors, making it difficult for Australians approaching retirement to seek financial advisors to help plan their decumulation phase;
• Lack of financial literacy, as Australians do not feel confident about making financial decisions and have a poor understanding of superannuation products and retirement income options; and
• Barriers to financial advice due to high fees charged by advisors, lack of trust in financial advisors and difficulty to locate a reliable and relatable adviser.

The result? Too many Australians underspend due to fear of running out of their retirement savings before they die and/or left to plan their retirement alone, and most are flying blind.

Current retirement calculators: A broken compass

You've probably seen them. Retirement calculators that promise to “show you how much you'll need for a comfortable retirement.” But most are either:

• Overly simple, resulting in rough estimates that don’t reflect reality and are based on averages; or
• Overwhelmingly complex, asking too many questions and disengaging, turning users away.

Even Super Consumers Australia agrees, with their findings that ‘fund retirement calculators cannot be counted on to always produce reasonable results’. ^[1]

It's clear: retirement calculators as they exist today aren't enough, and we should be playing a more prominent role in supporting retirees through their decumulation phase.

A new approach: AI Retirement Information Centre

To better support Australians as they enter retirement, some super funds are exploring the use of artificial intelligence (AI) to improve how information is delivered and understood.

The AI Retirement Information Centre is one example of how technology can enhance the way members engage with their retirement planning. Rather than providing static estimates, the platform offers an interactive experience, enabling users to ask questions, explore different scenarios and better understand their options.

Key features include:

• A conversational interface that responds to member questions in plain language
• The ability to translate content into a member's native language
• Personalised, context-relevant information aligned to the user's profile and needs
• Support for “what if” scenarios to help members think through different retirement choices

The tool is designed to inform, help, guide and support members navigate complex decisions without crossing into the domain of regulated financial advice.

Benefits for super funds

Beyond improving the member experience, AI-powered tools like this one can also collect data and help generate insights into member behaviour, needs and preferences — informing product design and communication strategies.

Importantly, the integration of AI does not necessarily require extensive system overhauls. The technology can be implemented alongside existing infrastructure and calculators, providing additional support without requiring a full rebuild.

Fast, practical and safe

Recent developments have shown that AI-powered tools can be introduced in a pragmatic and iterative way, without the need for large-scale transformation or significant investment. By building on existing digital infrastructure and leveraging modern platforms and APIs, superannuation funds can explore AI solutions in a manageable and low-risk manner.

Importantly, these tools don't require highly specialised AI teams or long development cycles. Cross-functional collaboration between product, digital and compliance teams can support the creation of helpful, member-facing features that enhance the retirement experience.

While caution around AI is understandable, many of the underlying technologies — such as natural language processing, machine learning and secure data handling — are already embedded in everyday tools Australians use. With proper oversight, these capabilities can be adapted for retirement planning in ways that are both effective and compliant.

Looking ahead

Retirement planning shouldn't feel like guesswork. With tools like the AI Retirement Information Centre, we can give Australians greater clarity, confidence and control over their retirement journey.

This isn't about replacing financial advice — it's about supporting those who don’t have access to it and guiding them with reliable, easy-to-understand information.

Actuaries are well placed to support this transition. With expertise in risk modelling, member behaviour and systems thinking, the profession can help shape AI-enabled tools that better serve diverse retirement journeys.

It may be time to move beyond traditional calculators — and to begin developing tools that give members choice and options on what, how and when to use the tools and reflect the complexity, diversity and importance of the retirement phase.

References

^[1] Super Consumers Australia. (2024, September 27). Can we count on them? Assessing the usefulness of super fund retirement calculators (Calculators report). Super Consumers Australia. https://superconsumers.com.au/wp-content/uploads/2024/09/Calculators-report-final-1.pdf