Introducing AI in Pension Planning: A Comparative Study of Deep Learning and Mamdani Fuzzy Inference Systems for Estimating Replacement Rates
Year: 2025
Type: article
Abstract: Funded pensions have become a key focus in strategies to ensure supplementary income during retirement. This paper explores two distinct approaches for estimating replacement rates: a deep learning model and a Mamdani Fuzzy Inference System (FIS). Using synthetic datasets for training, the deep learning model delivered accurate replacement rate predictions when benchmarked against exact solutions. On the other hand, the FIS approach, which leverages expert insights and practical experience, produced encouraging results but revealed opportunities for refining the definitions of intervals and linguistic categories. To bridge the strengths of both approaches, we introduce a conceptual integration using the Analytic Hierarchy Process (AHP), providing a multi-criteria decision-support framework that combines predictive accuracy from neural networks with the interpretability of fuzzy systems. The findings emphasize the potential of artificial intelligence (AI) methods, including neural networks and fuzzy logic, in advancing pension planning. While these techniques remain underutilized in this area, they hold significant promise for developing decision-support systems, particularly in big data contexts. Such systems can offer initial replacement rate estimates, serving as valuable inputs for experts during the decision-making process. Additionally, the paper suggests future research into multi-criteria decision analysis to improve decision-making within multi-pillar pension frameworks.
Source: Mathematics
DOI: 10.3390/math13233737
Authors: Pantelis Z. Lappas, Georgios Symeonidis
Institutions: University of the Aegean, University of Piraeus
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $3,137
OpenAlex ID: W4416458398