Planit:"Model As" Options

From Planipedia

What is the “ Model As ” Option When Adding a Pension or Other Revenue?

One of the most unique and time saving features of the Web Advisor is the “Auto Model” process. This is a feature that allows the Web Advisor to automatically do up to 50 “what if” scenarios in order to identify a strategy the eliminates all of your client’s shortfalls relative to the life goals retirement analysis.

To do this “Auto-Modeling” process, the system needs some assistance from the advisor to identify the modeling steps to take and the order in which to perform those steps. For example, on the “Auto Model” screen you tell the system how much more the client is willing to save over and above their current savings levels. You identify how much longer they would be willing to work and how much less retirement income they would find acceptable. These thresholds are used in the auto modeling process to identify a combination of steps that solve the shortfall problem.

When the “Work Longer” option is used, this introduces some complexities to the auto model process. This is because it’s not uncommon for some revenue streams that are entered on the Pensions and Other Revenues screen to be tied specifically to the target retirement date.

For example, as seen here, you might have a Pension Income that will start at age 60 (assuming the client can achieve their goal to retire at age 60). However, if the auto modeling process determines that the client has to work three years longer, then of course that pension would need to be delayed until age 63.

When you select “Start during Retirement” from the “Model As” drop down menu, you are telling the system to modify the start date on this revenue stream should the target retirement date be delayed. This is just one example of how a revenue stream can be flagged so that it will be handled correctly in the auto modeling process. There are actually 4 different options in the “Model As” drop down box that you can choose from. Here’s an overview of each and examples of where they are used.