Do I get rich, or go bust? These tools predicted my financial future

Of course, there’s a 17% chance—roughly the odds of rolling a seven at the casino—that we’ll outlive our money. Crap.

After plugging my income, debt, assets, hopes and fears into the newest generation of financial-planning tools, these were two of the possible financial futures predicted. No mere retirement calculators, tools like let you play out a range of financial futures and what-ifs for income, health, market turbulence, the impact of Roth conversions and the fate of Social Security.

Laurence Kotlikoff, the Boston University economist behind MaxiFi, calls it “a videogame for older people."

As a 50-year-old passive investor with an active imagination, I relished beating up my life and money with calamities worthy of a ledger book of Job. What if Elon Musk buys The Wall Street Journal and replaces me with a self-editing bot? What if my wife then leaves me for the bot? What if tax rates double, Social Security benefits halve and my 401(k) plunges to zero?

I watched my future salary and net worth rise and plummet—and plummet some more. Then I made myself a drink.

“What we show you is the range of possible outcomes," Steve Chen, founder of Boldin, formerly NewRetirement, told me. “It’s not a guarantee but a way to guide your decisions and avoid catastrophic mistakes."

401 kilotons

A financial adviser once assured me that money isn’t nuclear physics. He was wrong.

The math powering these retirement planning tools was developed during the Manhattan Project to calculate the neutron diffusion paths for the hydrogen bomb.

Nobel-winning economist William Sharpe later applied the same math—dubbed Monte Carlo simulations—to markets and investment portfolios, a more apt use of a technique named after a casino. In the 1990s he started Financial Engines, which brought such analyses to the masses.

“In the early days it was a tough sell," said Jeff Maggioncalda, who was the company’s first CEO. “People didn’t trust an algorithm with something as personal as their financial future."

Monte Carlo simulations run hundreds or thousands of scenarios using ranges for uncertainties such as how long you will live, how markets and the economy will perform and how much you will have to spend on health and taxes.

If you set your investments to return anywhere from 3% to 6% in a given year and inflation to range between 2% to 5%, the models can give you an idea of how your finances could look in the decades ahead.

Tools like Boldin and MaxiFi allow for a tremendous amount of tinkering and customization. They offer a powerful window into the future value of your present money—What does my current 401(k) balance really mean?—and you can see how smaller changes in investing and spending can have an outsize impact. You also get to see your lifetime tax bill.

MaxiFi and Boldin charge subscriptions of a little over $100 a year to access the core features. The tools are more robust than what’s available on most brokerage sites for a 401(k), and they have no financial interest in your allocations. Setting up the profile takes some time and legwork, and I ran into some hiccups logging into the Social Security site to get my estimated future benefits.

The downside of these models is that most people don’t know enough about financial planning and markets to properly use them and interpret the results, said Michael Kitces, financial planner and co-founder of the XY Planning Network. “The tools have gotten a lot better," he said, “but there is a high risk of user error."

I get his point. Estimating how much I will spend in retirement, or even a few years from now when my kids are off to college, felt like a wild guess. By tinkering with the range of market returns I could make myself overconfident. Or terrified.

To balance those drawbacks, MaxiFi’s models take a different approach, calculating a sustainable lifestyle and level of spending based on your investing and risk preferences.

Landing on Boardwalk

In 2002, as a reporter for the Press of Atlantic City, I visited all the fortunetellers on the boardwalk to see if there was any consensus about my future. It was better than therapy.

One predicted I would meet the love of my life in November. (She only missed the mark by five months.) Another said I would write many books. (The jury is out on that one.)

Using these financial tools had a similar effect, even if the prognostications were slightly more grounded in reality. In both cases, I was prompted to have real conversations with my future self, something that like most people, I generally avoid doing.

I know that every financial decision is a trade-off between my present and future self and that every dollar spent today is several dollars less in my account tomorrow. But seeing those trade-offs play out, and working through a range of futures, changed how I think about my balances today.

Using Boldin and MaxiFi made me feel better about the new year and the years to come. I’m in no position to retire soon, but as long as I can keep that bot away from my boss and wife, there’s an 83% chance everything will be fine.

Write to Jeremy Olshan at jeremy.olshan@wsj.com