Rainbow Planner: Reparative and Justice Values-Aligned Radical Financial Planning Toolkit

Financial projection software has the conscious and unconscious assumptions of the wealth defense industry deeply baked into its underlying models. We’ve also found more than a few blatant math errors when testing the common US software. Then it runs a Monte Carlo method – a statistical concept that “uses repeated random sampling to solve problems that are deterministic in principle” – to do the opposite of the scientifically sound intention: making the deeply flawed model of a non-deterministic problem (predicting the financial future) look solved. This highly sophisticated math method scares financial service providers into blind belief of the predictions, and the predictions quite reliably require >$5 million in savings for a single person to “retire safely”. This scares clients into wealth hoarding and investing into the stock market, which the software by default offers as the only way to “beat inflation”.  In fact, we consider financial prediction software a “weapon of math destruction” (as described by Cathy O’Neil): They are algorithms that are not responsive to real world data or facts – from the clients’ own innate sense of their finances via natural adjustments of their financial decisions to changing circumstances to the numerical data of their actual cash flows and portfolio development – rather, they use “opaque, unregulated, and difficult to contest” models to create data and project facts whose impact on the real world reinforces the injustice of wealth disparities.  The problem of biased and inaccurate models is further exacerbated by the many structural intermediaries that often sit between individuals and their own finances. For wealthy people, these intermediaries are primarily composed of the wealth defense industry (a concept we are thrilled not to have to explain to this audience!). Even wealthy people who hold values related to redistribution and justice who are able to find values-aligned financial professionals, still face challenges of financial intermediaries inadvertently overriding many of their values in the actual management of their money due to the opaque models and software on which these professionals are trained to depend.  Non-wealthy people, meanwhile, face an array of additional challenges when it comes to managing their financial lives and must contend with a financial services industry that is unaffordable at best and predatory at worst. Trustworthy and comprehensive financial information that is not related to selling something is extremely limited. And, that which is out there is almost 100% indoctrinated with capital bias. This is especially the case of freely available financial planning tools such as online retirement planning calculators and “investment management” platforms. This leaves many people vulnerable to false or predatory solutions, even when it comes to managing their money in alignment with their values. Of course, it is a general environment of low information and high perceived complexity that allows the wealth defense industry, and the financial services industry as a whole, to thrive today, albeit at the extreme expense of people and planet.

We believe that greed is not good. We believe that, in fact, a majority of people share this belief.  Unfortunately, greed-is-good ideology - an aspect of what Majorie Kelly calls “capital bias” - is currently deeply baked into the training and technological tools of the financial planning profession, particularly across the U.K. and the U.S. The goals of our hack are to  A) expose the ways capital bias is, often unconsciously, embedded into the models and software of financial planning;  B) offer alternative models and technological tools that disembed this bias; and  C) make this toolkit so broadly accessible and transparent that other change-makers can identify and further disembed remaining biases.  Our hack is multi-phased and evolving along the following stages:  1) Develop prototype financial planning tools, such as retirement forecasting and investment management tools, that demonstrate that it IS possible to disembed capital bias from financial planning models and software.  2)  Test and iterate on these tools with values-aligned financial professionals and values-aligned individuals who are “DIY” managing their personal finances.  3) Collectively develop best practice methodology for training and implementation of these tools.  4) Roll-out a free, scalable, open-source technological and pedagogical solution that incorporates our learnings from steps 1-3 and meets the needs of both financial professionals and individuals managing their personal finances directly. We have pursued stage 1 since mid 2023, and this summer completed a suite of US-specific spreadsheets as well as and one example use case of some of our tools: www.bothandfinance.com/financial-foundations. We also started stage 2 by modeling some close families’ financial situations – which has already led to substantial liberation from the wealth defense industry – and presenting drafts to a group of values-aligned “radical financial planners” – to great excitement at the possibilities.  A dedicated – and funded – sprint would enable us to - adjust the simple (tax code independent) models from stage 1 to allow for numerical modeling in any currency and socio-economic context; - advance stages 2-3 by convening a beta cohort of first-mover financial planners (serving a wide variety of communities in - at least - the US and UK) – to test and provide feedback on the stage 1 prototypes, and to collectively develop a methodology for broader training and implementation of these tools. Because our hack seeks to address not only a tech problem, but also problems of deeply ingrained ideology at the intersection of wealth and math supremacy currently pervasive in the financial planning profession, we believe a “solution” will only be effective to the extent that it is collectively developed and tested in collaboration with many people across and beyond the field of financial planning. This beta cohort of values-aligned financial planners would be a first step in what we envision to be an ongoing collective process of co-learning and co-development. We envision possible long-term outcomes across many – not even necessarily values-aligned – spaces in which financial advisors hold modeling and decision-making power.  A particularly potent space for transformative outcomes is the financial and investment advice sought by high net worth individuals and family foundations, charitable entities, foundations and endowments, etc. as these investors, trustees, and fiduciaries work to values- and mission-align their investments for a just and equitable world. Additionally, while this cohort may only include one or two advisors outside the US to start, we imagine that this offering will be deeply valuable to offer across the landscape of financial advisors in the UK and the EU alike, as more and more investors and foundations are seeking to align their investments with social movements and solidarity economies. 

Financial professionals who serve clients with wealth justice values would be able to utilize projection and evaluation tools that are aligned with and customizable to those values. Individual investors would have free access to robust and transparent DIY tools to manage their personal finances and would be more empowered to align their financial decisions with their values. With the Great Wealth Transfer on the horizon, this will be a necessary tool and hack “inside the belly of the beast” to redistribute hoarded wealth back to the people and places where the wealth was created to begin with. Ultimately, we see this as one step in a broader effort to influence the way people think, particularly inside and adjacent to the field of personal finance, to move towards a more just and regenerative economy for everyone.