Planit:Creating a Model Strategy Using the AutoModel Exercise Answer Key

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Template:Creating a Model Strategy Using the Automodel Exercise Answer Key

United States of America
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Argentina
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Brazil
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United Kingdom

== Question One: == Julie Evans has provided you with some extra information so that you can complete a full, life- goals analysis: She only needs {{{requirement}}} annually during retirement, or {{{minimum}}} minimum. She is willing to save an extra {{{savings per year}}} per year, and work until age {{{work till age}}} if required. However, she would rather have her retirement lifestyle adjusted before her retirement age. When she reaches retirement she would like to adopt a moderate risk profile, and upon her age{{{retirement age}}} a conservative risk profile. Input this data for the client and then answer the following questions: Where did you enter the extra savings? Was the Adjust Age Before Income checkbox checked? What did you enter for the minimum retirement lifestyle on the AutoModel screen? $____ Contents 1 Answer: 2 Question Two: 2.1 Answer: 2.2 Answer: 3 Question Two: 3.1 Answer: 3.2 Answer: 4 Question Two: 4.1 Answer: Answer: On the drop-down menu at the top of the screen, click the AutoModel Assumptions link to skip forward to this screen. As the advisor, you should decide where any extra savings are made, dependent on taxations, withdrawal fees and maximum account balances. The Retire By threshold should be {{{work till age}}}. Set the Minimum Retirement Lifestyle threshold to {{{minimum}}}. Finally, the Adjust Age before Income checkbox should be left blank, because Julie said that her retirement age was more important. So in the case that there is a capital shortfall, she would rather have her retirement lifestyle adjusted before her retirement age. Under the Life Cycle Portfolios section, you will notice three different sets of portfolios. Originally all of the current portfolios will be set to Current, and all of the target portfolios set to Very Aggressive. Here you can plan for the client’s declining risk tolerance. The First Portfolio can be left as is because it shows the correct settings for the client’s current portfolio strategy. In 6 years, when Julie retires at {{{retirement age 2}}}, she will adopt a new portfolio based on a lower risk. Set the Year function for the Second Portfolio to six (6) years from now. The Target Portfolio for this section can be set to “Moderate”. The current portfolio can remain at current to show what the client’s portfolio would have been like without your investment strategy. Following the same logic, set the Year for the Third Portfolio to 21 years from now, at Julie’s age {{{retirement age}}}, and the Target Portfolio to “Conservative”. Click Save Where did you enter the client’s extra savings? Julie’s Registered Savings (this is not the only correct answer; as long as reasons are given as to why savings were put in a certain savings stream such as taxation issues, they could also be legitimate). Was the Adjust Age Before Income checkbox checked? No What did you enter for the minimum retirement lifestyle on the AutoModel screen? {{{minimum}}} Question Two: {{{Male Name}}} and Julie Evans want to see the impact that your modeled scenario would have on their ability to retire, and the changes they would have to make to accommodate it. They are willing to save an extra {{{extra savings}}} into Julie’s Non-registered account each year, and retire by a maximum of age {{{work till age}}}. They need a minimum of {{{requirement annually during retirement, and would rather retire when they originally planned, even if it meant reducing their retirement income. Input this data for the client and then answer the following questions: What was the value of the field for Sally’s Other Savings under thresholds? $_____ Was the Adjust Age Before Income checkbox checked? Answer: Use the drop-down menu at the top of the screen to continue straight to the AutoModel Assumptions screen. You can input the £1,500 of extra savings within the Threshold fields for the Spouse’s Non-registered Savings as indicated. Enter the Retire By Threshold as {{{retirement age}}} for both {{{Female name 1}}} and {{{Male name 1}}}. The Minimum Retirement Lifestyle Threshold should be set to {{{requirement}}}. The Adjust Age Before Income checkbox should be blank. Click Save What was the value of the field for {{{female name 1}}}’s Other Savings under thresholds?{{{extra savings}}} Was the Adjust Age Before Income checkbox checked? No

Russia
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China
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Malaysia

== Question One: == Suhaila Mokhtar has provided you with some extra information so that you can complete a full, life- goals analysis: She only needs {{{requirement}}} annually during retirement, or {{{minimum}}} minimum. She is willing to save an extra {{{savings per year}}} per year, and work until age {{{work till age}}} if required. However, she would rather have her retirement lifestyle adjusted before her retirement age. When she reaches retirement she would like to adopt a moderate risk profile, and upon her age{{{retirement age}}} a conservative risk profile. Input this data for the client and then answer the following questions: Where did you enter the extra savings? Was the Adjust Age Before Income checkbox checked? What did you enter for the minimum retirement lifestyle on the AutoModel screen? $____ Answer: On the drop-down menu at the top of the screen, click the AutoModel Assumptions link to skip forward to this screen. As the advisor, you should decide where any extra savings are made, dependent on taxations, withdrawal fees and maximum account balances. The Retire By threshold should be {{{work till age}}}. Set the Minimum Retirement Lifestyle threshold to {{{minimum}}}. Finally, the Adjust Age before Income checkbox should be left blank, because Suhaila said that her retirement age was more important. So in the case that there is a capital shortfall, she would rather have her retirement lifestyle adjusted before her retirement age. Under the Life Cycle Portfolios section, you will notice three different sets of portfolios. Originally all of the current portfolios will be set to Current, and all of the target portfolios set to Very Aggressive. Here you can plan for the client’s declining risk tolerance. The First Portfolio can be left as is because it shows the correct settings for the client’s current portfolio strategy. In 6 years, when Suhaila retires at {{{retirement age 2}}}, she will adopt a new portfolio based on a lower risk. Set the Year function for the Second Portfolio to six (6) years from now. The Target Portfolio for this section can be set to “Moderate”. The current portfolio can remain at current to show what the client’s portfolio would have been like without your investment strategy. Following the same logic, set the Year for the Third Portfolio to 21 years from now, at Suhaila’s age {{{retirement age}}}, and the Target Portfolio to “Conservative”. Click Save Where did you enter the client’s extra savings? Suhaila’s Registered Savings (this is not the only correct answer; as long as reasons are given as to why savings were put in a certain savings stream such as taxation issues, they could also be legitimate). Was the Adjust Age Before Income checkbox checked? No What did you enter for the minimum retirement lifestyle on the AutoModel screen? {{{minimum}}} Question Two: {{{Male Name}}} and Suhaila Mokhtar want to see the impact that your modeled scenario would have on their ability to retire, and the changes they would have to make to accommodate it. They are willing to save an extra {{{extra savings}}} into Suhaila’s non EPF account each year, and retire by a maximum of age {{{work till age}}}. They need a minimum of {{{requirement annually during retirement, and would rather retire when they originally planned, even if it meant reducing their retirement income. Input this data for the client and then answer the following questions: What was the value of the field for Sally’s Other Savings under thresholds? $_____ Was the Adjust Age Before Income checkbox checked? Answer: Use the drop-down menu at the top of the screen to continue straight to the AutoModel Assumptions screen. You can input the RM 7,000 of extra savings within the Threshold fields for the Spouse’s non EPF Savings as indicated. Enter the Retire By Threshold as {{{retirement age}}} for both {{{Female name 1}}} and {{{Male name 1}}}. The Minimum Retirement Lifestyle Threshold should be set to {{{requirement}}}. The Adjust Age Before Income checkbox should be blank. Click Save What was the value of the field for {{{female name 1}}}’s Other Savings under thresholds?{{{extra savings}}} Was the Adjust Age Before Income checkbox checked? No

Singapore

== Question One: == Ellen Tan has provided you with some extra information so that you can complete a full, life- goals analysis: She only needs {{{requirement}}} annually during retirement, or {{{minimum}}} minimum. She is willing to save an extra {{{savings per year}}} per year, and work until age {{{work till age}}} if required. However, she would rather have her retirement lifestyle adjusted before her retirement age. When she reaches retirement she would like to adopt a moderate risk profile, and upon her age{{{retirement age}}} a conservative risk profile. Input this data for the client and then answer the following questions: Where did you enter the extra savings? Was the Adjust Age Before Income checkbox checked? What did you enter for the minimum retirement lifestyle on the AutoModel screen? $____ Answer: On the drop-down menu at the top of the screen, click the AutoModel Assumptions link to skip forward to this screen. As the advisor, you should decide where any extra savings are made, dependent on taxations, withdrawal fees and maximum account balances. The Retire By threshold should be {{{work till age}}}. Set the Minimum Retirement Lifestyle threshold to {{{minimum}}}. Finally, the Adjust Age before Income checkbox should be left blank, because Ellen said that her retirement age was more important. So in the case that there is a capital shortfall, she would rather have her retirement lifestyle adjusted before her retirement age. Under the Life Cycle Portfolios section, you will notice three different sets of portfolios. Originally all of the current portfolios will be set to Current, and all of the target portfolios set to Very Aggressive. Here you can plan for the client’s declining risk tolerance. The First Portfolio can be left as is because it shows the correct settings for the client’s current portfolio strategy. In 6 years, when Ellen retires at {{{retirement age 2}}}, she will adopt a new portfolio based on a lower risk. Set the Year function for the Second Portfolio to six (6) years from now. The Target Portfolio for this section can be set to “Moderate”. The current portfolio can remain at current to show what the client’s portfolio would have been like without your investment strategy. Following the same logic, set the Year for the Third Portfolio to 21 years from now, at Ellen’s age {{{retirement age}}}, and the Target Portfolio to “Conservative”. Click Save Where did you enter the client’s extra savings? Ellen’s Registered Savings (this is not the only correct answer; as long as reasons are given as to why savings were put in a certain savings stream such as taxation issues, they could also be legitimate). Was the Adjust Age Before Income checkbox checked? No What did you enter for the minimum retirement lifestyle on the AutoModel screen? {{{minimum}}} Question Two: {{{Male Name}}} and Ellen Tan want to see the impact that your modeled scenario would have on their ability to retire, and the changes they would have to make to accommodate it. They are willing to save an extra {{{extra savings}}} into Ellen’s {{{Account 1}}} account each year, and retire by a maximum of age {{{work till age}}}. They need a minimum of {{{requirement annually during retirement, and would rather retire when they originally planned, even if it meant reducing their retirement income. Input this data for the client and then answer the following questions: What was the value of the field for Sally’s Other Savings under thresholds? $_____ Was the Adjust Age Before Income checkbox checked? Answer: Use the drop-down menu at the top of the screen to continue straight to the AutoModel Assumptions screen. You can input the $3000 of extra savings within the Threshold fields for the Spouse’s {{{Account 1}}} Savings as indicated. Enter the Retire By Threshold as {{{retirement age}}} for both {{{Female name 1}}} and {{{Male name 1}}}. The Minimum Retirement Lifestyle Threshold should be set to {{{requirement}}}. The Adjust Age Before Income checkbox should be blank. Click Save What was the value of the field for {{{female name 1}}}’s Other Savings under thresholds?{{{extra savings}}} Was the Adjust Age Before Income checkbox checked? No

Hong Kong
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India
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Caribbean
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