Planit:Auto Model Process

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There is more than one way to learn about PlanPlus Planit. Check out our other Training options, from structured tracks around planning types, to self-serve, mix-and-match topics. In this Video you will Learn... How does Planit determine what changes my client needs to make for financial success? • Purpose of AutoModel • AutoModel steps for solution • Client data gathering and presentation Keep on Track! Continue training on... Getting Started Why You Should Use Planit Integrated Planning Life Planning Personal Financial Strategy Integrated Financial Plan Long Term Cash Flow Spreadsheet Modelling Assumptions Screen Other Related Topics Retirement Thresholds Savings Thresholds Introduction to the Modelling Assumptions Screen Ranking Objectives Life Goals Retirement Strategy A Comparison of Results

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The Auto Model process is very methodical. It’s follows these basic steps:

• The target portfolio will be implemented and the scenario re-ran to determine if a shortfall still exists. Often the target portfolio will have a higher projected return than the current portfolio as illustrated above and the improvement in the rate of return in cases where there is only a small shortfall might be sufficient to eliminate the shortfall entirely. If not, then the next step is taken.

• Increase savings based on the thresholds identified are implemented to determine if this will eliminate the shortfall. While the savings are increased, the system also recognizes that the current lifestyle will reduce since you have to spend less to save more. If a shortfall still exists, the process will continue.

• The ranking of the other life goals are compared with the ranking of the retirement goal to determine if any of these other goals should be eliminated. The analysis also recognizes cases were a high ranked goal cannot be achieved regardless of whether retirement is delayed or any other tactic. These unrealistic goals are removed.

• If the client’s target age had a higher priority than the target income, the next step will be to increment the client and spouse’s ages one year at a time until their individual thresholds are reached. If the shortfall is eliminated at any time through this process the modeling will stop. If a shortfall still exists once the thresholds are reached, the process will continue.

• If the clients target income was a higher priority than the target age, then the income target will be reduced in 20% increments until the threshold is reached. Again, should a surplus result at any time during this process, the modeling will stop.

• Should both the income and age thresholds be reached and a shortfall still exist, as a last resort the system will continue to reduce the income target until a surplus is found. This means that a solution will be found regardless how unpalatable it might be. This is because this is the reality for the client. It helps them appreciate how unrealistic their objectives might be.