A robo-advisor for retirement is software that plans a worker's retirement savings and manages the investments automatically, with little or no help from a human adviser. A robo-advisor is an automated investment adviser. Many of these services reach ordinary workers through the retirement plan that their employer offers.
Here is how such a service works in general. It asks for the worker's age, salary, current savings, planned retirement age and how much risk they can accept. It works out how much money the worker will need after retirement. It then recommends how much to save each month, and how to split the savings between shares and bonds. Shares can grow more, but their value goes up and down. Bonds grow less but are steadier. As the years pass, the software moves the money step by step from shares to bonds, so that a fall in share prices just before retirement does less damage. This planned shift is called a glide path.
In India, many salaried employees already save for retirement through the EPF, the Employees' Provident Fund. Some also save in the NPS, the National Pension System. The NPS has an automatic choice that works like a simple robo-advisor. Imagine a 30-year-old employee who puts ₹6,000 a month into the NPS and picks this automatic choice. While she is young, a large part of her money is invested in shares. Every year after a certain age, the share part is reduced, until most of the money is in bonds by her mid-fifties.
In America, the employer's retirement plan is the main channel. The employer's benefits administration system enrols the employee and sends the monthly contribution. The robo-advisor decides the mix. It then places the investments through an investment management system.
In India, software that gives personal investment recommendations must follow SEBI's rules for investment advisers. This is explained in investment advice regulation. A robo-advisor is also different from an index fund. An index fund is one investment. A robo-advisor decides the mix of investments, and keeps changing it over decades. It is one part of personal finance.