Financial Planning with AI for FY27

Financial planning can often resemble preparing for a challenging mathematics exam, leaving many feeling puzzled and overwhelmed. This experience is common; when individuals excitedly attempt to create financial plans for the upcoming year using spreadsheets, they frequently find themselves unsure of where to begin.

Embrace the Changes with AI

The landscape is evolving. In the era of Artificial Intelligence (AI), managing finances is becoming clearer, more straightforward, and less time-intensive. Numerous individuals are turning to AI solutions like ChatGPT, Gemini, Claude, and others to effectively manage their financial responsibilities. If planning for FY27 has been put off, here are ways to utilise these AI tools to develop a practical financial strategy.

Step 1: Assess Your Earnings

The first step in this process is to gather accurate data regarding total earnings, as relying on estimates can often lead to inaccuracies. Collect salary slips, side hustles, rental income, and accrued interest from FY 2025-26.

Next, share these figures with ChatGPT or your preferred AI tool and request a breakdown summary of your annual income by categories. Be sure to include even minor income sources, as they may have tax implications.

Step 2: Choose Your Tax Regime

The government has updated the tax regime for 2026–27, introducing better slabs, standard deductions, and a Section 87A rebate. However, selecting between the old and new tax regimes may seem daunting. The most suitable tax regime will depend on individual financial circumstances.

To ascertain which option is best for your situation, individuals can easily estimate their tax regime using ChatGPT. Just input information such as salary, deductions, and investments for a detailed comparison to guide your choice.

An example prompt could be: “My annual salary is [amount]. I pay [amount] in home loan interest, receive [amount] as HRA, and have invested [amount] under 80C. Can you compare my tax liability under the old and new tax regimes for FY 2026-27 and recommend which suits me better?”

Step 3: Budget Your Monthly Expenses

Begin by identifying the key areas where money is spent every month. This includes stable monthly expenses such as rent, EMIs, insurance premiums, subscriptions, and ongoing investments like SIPs. Once this list is complete, use AI to analyse monthly expenditures.

If more than half of your salary goes towards fixed costs, it may indicate financial strain. A helpful prompt might be: “My take-home salary is [amount] per month. My fixed monthly expenses are: [list them]. What percentage of my income goes towards fixed costs, and how can I optimise my spending?”

Step 4: Leverage AI for Savings and Investment Goals

To establish savings and investment targets, input your objectives into ChatGPT, such as retirement, home purchase, or educational expenses. Providing current income and investment details will enable AI to offer basic allocation recommendations across options like equity, debt, PPF, or NPS. Including your age and investment timeframe will yield more tailored advice.

Step 5: Create Emergency Funds

It is important to maintain three to six months’ worth of income as an emergency safety net. However, setting aside funds for emergencies may prove challenging, especially with rising costs and variable EMIs.

Using AI tools, individuals can request assistance to calculate an appropriate emergency fund target and a monthly savings strategy to achieve it within a selected timeframe, simplifying the process of financial planning.

Step 6: Develop a One-Page Annual Plan

After detailing income, expenses, savings goals, investments, and emergency funds, prompt AI to generate a one-page summary or organise the information into an easily digestible format.

Ensure to save the plan and revisit it every few months.

To initiate this process, you can enter the following prompt into ChatGPT with your specific details:

“I want to create a simple financial plan for FY 2026–27. My monthly take-home salary is [amount]. My fixed monthly expenses are approximately [amount], including [rent, EMI, SIPs, insurance]. My financial goals for the year are [e.g., build an emergency fund, increase SIP, save for a home down payment]. I currently invest [amount] per month in [instrument]. I prefer the [old/new] tax regime. Please help me: estimate my annual tax liability, suggest a monthly savings and investment plan, calculate my emergency fund target, and give me a simple one-page plan I can follow for the year.”

Disclaimer: While utilising AI tools offers numerous advantages, it is critical to remember that personal and financial information will need to be shared. Thus, caution should be exercised regarding what information is disclosed, and sensitive details such as bank account numbers, passwords, or identification details should always be protected.