Life Goals and Retirement Planning Guide

From Planipedia
Jump to: navigation, search

What is Life Planning?

After the Investment Policy process, Life Planning is the next step in financial planning in PlanPlus-Planit. Basically, this process aims to answer the question: what are the client's financial objectives? Does the client have the resources to reach these objectives, and what options are available if he does not?

There are three ways to go about answering these questions:

1. The Life Planning process flow
2. The Modular Goal process flow
3. The Modelling Assumptions screen

You can select any of these processes on the on the Client Data Entry droplist on the Home screen.


The Goals & Objectives screen - What are Life Planning Objectives?

A Life Planning Objective is a monetary value, most often defined for a certain span of years, that must be produced for a goal to be met. You can see them on the Objectives tab of the Goals & Objectives screen. There are two default objectives for any client (both of these values are derived from the Cash Flow screen):

1. Current Lifestyle (if the client is not past retirement age)
2. Retirement Lifestyle


The third kind are user-defined goals, like education goals for children or grandchildren, travels after retirement, buying real estate, etc. You can add these with the Add button. For a detailed description of this screen, see LINK.

The Modular Goal Process

Normally you must go through the whole Life Planning process and generate the Personal Financial Strategy document to see if the goals are met or not. However, you can test individual goals with a standalone tool on the Results screen, after you select the Modular Goal process on the Client Data Entry droplist.


First of all, select a goal on the Active Goal droplist to be examined. These are the goals defined on Goals & Objectives.

On the Results screen, you have the following tabs:

1. Assumptions - Here you can see the inflation rate, returns and other assumptions for this goal, and can select any model or custom portfolio to be applied for it.


2. Results - Here you can see if the results can be reached with the assumptions given on the previous tab or not. This screen works much like the various Goal Calculators (Retirement or Education Goal Calculators) you may know from previous versions.


3. Planning Alternatives - If you have a shortage, here you can select various factors (like Income Available, Delay Until and so on) and see that by modifying them, can you reach your objectives or not. After you click Calculate and the results are shown, use the slider to adjust the factors and see your alternatives.


The Modelling Assumptions screen

You can access this screen on the Life Planning or the Integrated Planning process flows. It works like the Results screen on Modular Goals above, as you set certain variables on the Parameters tab, then select a possible scenario (like Current, Client Death, Spouse Death and so on) on the Results tab, and click Calculate.

There are no interactive sliders here. You can see the client's revenue streams for the given scenario on graphs, before and after applying the personal financial strategy.