A 69-year-old retiree used Google's Gemini to stress-test his retirement plan, finding the free tool useful for withdrawal scenarios but prone to errors on Social Security taxation that required independent verification.
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AI Stress-Tests Retirement Plans, Missing the 85% Tax Cap
Skeptical that artificial intelligence will ever repay Big Tech's spending spree, a 69-year-old Barron's reporter still handed his retirement plan to Google's Gemini for a stress test — and came away impressed, though not without catching the model in several tax mistakes. Neal Templin said the free tool sized up his portfolio across three account types and ran it through extreme scenarios, from a repeat of the 1968-1982 bear market to helping adult children with a house down payment.
"I think you're wrong," Templin told the model when it added his entire annual Social Security benefit to his salary to calculate taxes. "Social Security is only 85% taxed at most." Gemini conceded the catch and lowered his bill within seconds, he said.
Templin's plan leans on stable income rather than growth. His tax-deferred 401(k) holds 20 percent in equities and the rest in bank certificates of deposit and Treasury inflation-protected securities, including a TIPS ladder built to generate income for 30 years. His Roth accounts are 100 percent in stocks, invested aggressively because withdrawals there are tax-free and can pass to heirs untaxed. For each year he defers retirement past 70, Gemini calculated an extra $300 to $500 a month for life.
Where the Model Tripped
The exercise exposed where free AI tools still fall short. When Templin asked Gemini to estimate taxes in retirement, it took 85 percent of his Social Security benefit and added it to required minimum distributions, producing a figure almost twice what a free AARP calculator returned. Gemini had failed to run the provisional income test, which taxes Social Security at less than the 85 percent cap when half the benefit plus other income stays below set thresholds. It corrected itself once Templin flagged the error.
The stakes go beyond one retiree's spreadsheet. As Morningstar and Vanguard both project a subpar period for equities given current high valuations, more Americans are likely to lean on low-cost tools to plan withdrawals and taxes. Templin said the model also flagged a risk he had not considered: even with a prenuptial agreement, the government could pursue assets if a future spouse entered Medicaid for long-term care.
Free Help, With a Caveat
Templin's experience does not change his view that Big Tech may struggle to recoup the hundreds of billions spent on AI and data centers. He keeps roughly half his equity holdings in foreign and value stocks that should be less exposed if the AI frenzy fizzles. But he said the free tool delivered planning help that would otherwise cost several thousand dollars from an advisor, provided users double-check its tax math against official rules and calculators.
Social Security taxation rules and benefit thresholds change with annual cost-of-living adjustments, so retirees should verify current figures against the latest Social Security Administration guidance before relying on any tool's estimate. This article is for informational purposes only and does not constitute investment advice.
