AI-Powered Financial Planning And The Rise Of Personalized Financial Independence Tools

The personal financial planning industry is undergoing its most significant transformation since the advent of online banking. Only 35% of Americans have a financial plan, with high costs, limited access to advisors and discomfort discussing finances serving as primary barriers. Now, artificial intelligence is changing that equation, offering deep personalized insights without the referral fees and conflicts of interest that have long plagued traditional advisory services.

The market is responding. The AI-Powered Personal Finance Management Market was valued at $1.37 billion in 2024 and is expected to reach $2.36 billion by 2032, growing at a 7% compound annual growth rate. More telling, 57% of finance professionals are already using AI in their operations, with another 14% planning implementation.

The Promise: Financial Independence Without the Sales Pitch

Traditional financial planning has always carried an inherent tension. Advisors charging 1-2% of assets under management had built-in incentives to recommend certain products, and fee structures kept sophisticated planning tools accessible only to high-net-worth individuals. AI-powered platforms are disrupting this model by offering objective scenario analysis, deep financial projections, and personalized planning at a fraction of the cost—or sometimes free.

AI-powered tools can analyze a household’s full financial picture—from income and assets to goals and risks—to generate personalized strategies that adjust to life changes like delayed retirement, unexpected healthcare costs or new passions in later years.

Take Hiro, founded by Ethan Bloch, the entrepreneur behind the successful fintech company Digit. After stepping down from Digit in 2023, Bloch was inspired by OpenAI’s advances to build “the thing I had been wanting to do with Digit for the last 10 years”. Hiro takes a conversational approach to financial planning, walking users through plan creation via chat and enabling what-if scenarios like “Buy a house for 1M or 1.5M? Take a year off work?” The platform tracks income and spending across all accounts, allows users to link accounts, upload CSVs, drop in PDFs, or manually edit balances, and uses purpose-built tools to excel at financial math with verifiable calculations.

Market Landscape

The AI-powered financial planning market has evolved into four distinct quadrants based on two critical dimensions: sophistication level (basic budgeting vs. comprehensive planning) and target market (consumer direct-to-consumer vs. advisor-focused B2B tools).

AI Powered Financial Planning Market Map

Josipa Majic Predin

High Sophistication / Consumer Direct (The Disruptors)

Representative Companies: Hiro, Tendi, Wealthfront, Betterment

These platforms offer comprehensive financial planning directly to consumers, bypassing traditional advisors entirely. They provide scenario modeling, tax optimization, retirement projections, and net worth tracking—capabilities once reserved for wealthy clients with dedicated CFPs.

Wealthfront, with $36 billion in assets under management serving its robo-advisor services, exemplifies the mature end of this quadrant. The platform charges a 0.25% annual advisory fee with a $500 minimum, includes automated tax-loss harvesting for all taxable accounts, and offers advanced features including direct indexing for accounts over $100,000. Wealthfront achieved the top 3-year trailing annualized return of 5.51% among analyzed robo-advisors.

Betterment, the largest independent robo-advisor with $46 billion in AUM serving approximately 900,000 clients, takes a different approach. Betterment earned top honors as the best robo-advisor overall in Bankrate’s 2025 reviews. The platform charges a 0.25% annual fee for its Digital Plan with no minimum balance requirement, while its Premium Plan costs 0.65% annually and requires a $100,000 minimum but includes unlimited access to certified financial planners.

The newer entrants like Hiro and Tendi are pushing boundaries further by eliminating advisory fees entirely and focusing on conversational AI interfaces that make sophisticated planning accessible to average consumers.

Market Position: These platforms are growing rapidly among younger demographics and middle-income households who were previously underserved. Research indicates nearly half of American consumers are either currently using or seriously considering AI-driven financial management solutions, with younger demographics leading this adoption trend.

High Sophistication / Advisor-Focused B2B (The Enhancers)

Representative Companies: eMoney Advisor, RightCapital, FP Alpha, Parthean

These platforms don’t replace financial advisors—they supercharge them. By automating analysis and generating insights from complex documents like tax returns, estate plans, and insurance policies, they enable advisors to serve more clients with deeper, more comprehensive planning.

eMoney Advisor, owned by Fidelity, maintains 28.20% market share as the current market leader, though down slightly from 29.55% in 2024. The platform emphasizes cash-flow planning and the ability to model plans for estate, retirement and education-funding purposes, with pricing starting at $2,400-$3,600 per advisor annually. The platform manages over $1 trillion in client assets for advisors from firms like TD Ameritrade and New York Life.

RightCapital is rapidly gaining ground. The platform captured 20.68% market share and shows a strong growth trajectory by offering advisors powerful features at mid-market pricing. RightCapital handles most daily planning needs without compromising speed, allowing advisors to toggle between goal and cash-flow views in the same plan with year-by-year tax projections alongside lifetime probability graphs.

FP Alpha takes a different approach by focusing specifically on document analysis. The platform reads clients’ tax returns, wills, trusts, and insurance policies, instantly summarizing key data, identifying actionable planning insights, quantifying the value of advice, and driving more revenue to the advisor. As Joel Bruckenstein, founder of the Technology Tools for Today (T3) Conference, notes in a testimonial: “FP Alpha provides advisors with a competitive advantage as fee-compression continues to affect the advisory space. The technology provides impactful recommendations with limited insight into a prospect’s financial and personal circumstances”.

Market Position: These tools are becoming essential infrastructure. AI adoption in finance surged from 45% in 2022 to an expected 85% by 2025, with 60% of companies using AI across multiple business areas. Advisors who don’t adopt these platforms risk being left behind by competitors who can serve clients faster and more comprehensively.

Basic Functionality / Consumer Direct (The Gateway)

Representative Companies: Cleo, Monarch Money, Acorns

These platforms focus on budgeting, expense tracking, and basic financial management. While less sophisticated than full planning platforms, they serve an important role as entry points for financial literacy.

Cleo is a chatbot-driven personal finance assistant utilizing AI with an engaging and intuitive approach to budgeting, analyzing financial data to offer personalized advice and helping users stay on top of spending. Monarch Money provides customized budgeting plans that adapt to individual user needs and goals, tracking income and expenses while visualizing financial progress over time.

Market Position: These platforms capture users early in their financial journey and often serve as feeders to more sophisticated tools as users’ wealth and complexity grow.

Basic Functionality / Advisor-Focused (The Workflow Tools)

Representative Companies: Jump AI, Holistiplan, Beautiful.ai

These tools solve specific pain points in advisor workflows—meeting notes, tax return analysis, presentation creation—without attempting comprehensive planning.

Jump AI is a meeting note-taking tool purpose-built for financial advisors to address the major pain point of post-meeting documentation and follow-up, saving teams at least 30 minutes per meeting. Holistiplan enables advisors to summarize and organize data in tax returns for analysis, scenario comparison, and advice delivery.

Market Position: These specialized tools are increasingly becoming table stakes for advisory practices focused on operational efficiency.

The Competitive Dynamics

The market is seeing three distinct competitive forces:

1. The Incumbent Challenge

Traditional financial planning software leaders like eMoney and MoneyGuidePro are fighting to maintain relevance. MoneyGuidePro’s market share dropped from 33% in 2024 to 22.79% in 2025, suggesting the established players are under pressure. Development at MoneyGuidePro has slowed since the Envestnet acquisition, and survey data show advanced users migrating to newer platforms.

These incumbents have deep integration with broker-dealers and major financial institutions, but they risk being disrupted by more agile competitors with native AI capabilities. MoneyGuidePro is a goals-based application ideal for advisors servicing clients in accumulation stages or with less than $1 million of investable assets, priced between $1,300 and $2,000.

2. The Robo-Advisor Evolution

Platforms like Wealthfront and Betterment, which started as simple automated portfolio management tools, are evolving into comprehensive financial planning platforms. They’re moving upstream, adding features like estate planning, tax optimization, and human advisor access that were once the exclusive domain of traditional wealth management.

Wealthfront offers smart financial advice via the Path tool, providing projections and recommendations, along with daily rebalancing to maintain target allocation. Meanwhile, Betterment has introduced cryptocurrency portfolios and socially responsible investing options, signaling adaptability to modern preferences.

3. The AI-Native Upstarts

Companies like Hiro, Tendi, and Parthean are being built from the ground up with AI as their core technology, not bolted on as a feature. This architectural advantage allows them to offer capabilities—like natural language financial planning or instant document analysis—that legacy platforms struggle to match.

The Technology Advantage: What Makes AI Different

The current generation of AI-powered financial planning tools offers capabilities that weren’t possible even two years ago:

Natural Language Processing for Accessibility Advancements in natural language processing and conversational AI improve the accessibility of financial advice, with advisors using NLP tools to draft personalized client communications and create detailed financial reports.

Scenario Modeling at Scale With AI, FP&A teams can quickly model multiple “what-if” scenarios to evaluate the potential outcomes of different strategies, supporting smarter, data-driven decision-making in uncertain or dynamic conditions.

Document Intelligence AI-driven technology “reads” clients’ tax returns, wills, trusts, and insurance policies, instantly summarizing key data and identifying actionable planning insights.

Predictive Analytics AI can leverage predictive analytics to analyze historical and current data, providing insights that help anticipate future trends and outcomes with greater accuracy.

Market Outlook: Convergence and Consolidation

Several trends will shape the market over the next 3-5 years:

Democratization Will Accelerate AI-driven financial advice is creating a more equitable financial landscape where everyone—not just the wealthy—can plan confidently for the future. The cost differential is dramatic: Robo-advisor fees typically range from zero to 0.35% of assets under management, compared to traditional advisor fees of 1-2%.

Human + AI Hybrid Models Will Dominate Checking AI-generated advice with a professional is important, with advisors moving beyond static annual reviews to offer real-time, adaptive guidance that changes with life circumstances. The winning model won’t be AI replacing humans, but AI augmenting human advisors to serve more clients better.

Consolidation Among Incumbents The market has too many players offering similar capabilities. Expect M&A activity as established platforms acquire AI capabilities and upstarts seek distribution. Betterment’s February 2025 acquisition of Ellevest signals this trend.

Enterprise Integration The global financial planning software market is projected to reach $18.2 billion by 2033, growing at a robust 15.5% CAGR. Much of this growth will come from enterprise adoption as banks, broker-dealers, and large RIAs standardize on comprehensive platforms.

The Bottom Line

AI-powered financial planning represents a genuine democratization of sophisticated financial services. For the first time, average consumers can access objective, comprehensive financial planning without paying exorbitant fees or navigating conflicted advice.

The technology is proven—specialized AI platforms like Tendi score significantly higher than general AI models on the Certified Financial Planner exam, demonstrating they can match or exceed human expertise in core planning concepts. The adoption curve is steep, with 57% of finance professionals already using AI and consumer adoption following rapidly.

For consumers, the calculus is straightforward: Platforms like Hero offer sophisticated scenario analysis, objective advice free of referral fees, and the ability to model everything from career changes to home purchases to early retirement—all at a fraction of traditional advisory costs.

For financial advisors, the message is equally clear: Advisory firms using advanced financial planning software experience 40% higher productivity, 35% improved client satisfaction, and 25% faster revenue growth. The technology isn’t replacing advisors—it’s making the best advisors better while eliminating the mediocre middle.

The AI-powered financial planning revolution is here. The only question is whether traditional players can adapt fast enough to compete.

Forbes