Plan Data: Assumptions

Transcription

1 TOTAL Online EASY MONEY GOLDEN YEARS Plan Data: Assumptions 1

2 Plan Data Once you select a [Client] and a [Planning Scenario] for the client, [Plan Data] with the subsequent data entry sections displays. The first plan data section is [Assumptions]. 2

3 Assumptions The [Assumption] section collects basic scenario information such as the clients retirement age and life expectancy and important planning assumptions. A majority of the items in the assumption section are populated with default values from settings. Save data entry time by entering default values under Settings and simply review and make adjustments when required for a specific plan using the Assumptions section. Learn more: Settings User Guide 3

4 Assumptions - Scenario [Scenario Name] Enter a descriptive name to identify the scenario. Example: July 2016 Planning. The scenario name can be included on the reports. [Retirement] Enter the age of retirement. Reaching retirement triggers events, such as earned income and account additions ending, and retirement spending starting. [Life Expectancy] By default, the life expectancy will be populated using IRS Uniform Lifetime table. Overwrite by simply entering the desired life expectancy. 4

5 Assumptions - Scenario [Cover Name] Enter the client(s) name as desired to appear on the report cover page [Easy Money Title] By default, the cover page title is Personal Financial Analysis. Enter a title to overwrite the default. [Golden Years Title] By default, the cover page title is Personal Retirement Analysis. Enter a title to overwrite the default. 5

6 Assumptions - Scenario [Report Cover Page Lines] Six lines of text display on the cover typically used for the planner name and contact information. [Page Header] Displays at the top of each report page, often used for required disclaimers. 6

7 Assumptions Default Rates [Rates of Return] are the default rates for each asset type. The default rates are used rates are not entered per assets in the Assets section. [Overwrite at Retirement?] This overwrites all other rates of return (including returns entered for individual assets) and use the rates throughout retirement. Use caution and ensure this is your intended behavior when checking this box. 7

8 Assumptions Default Rates [Discount Rate for NPV Calculations] This rate is used to compute the amount of capital required today to fund future income shortfalls. Typically the rate is equivalent to a conservative after tax rate of return. In the case of shortfalls, solutions will calculate additional savings required at three rates of [Return on Needed Additions] and the additions assume to increase yearly at the [Increase Rate on Needed Additions]. 8

9 Assumptions Surplus Allocation When a surplus occurs, specify how the surplus is reinvested using [Reinvestment Allocation]. Enter the percentage of a surplus allocated to each asset type. Change the surplus allocation at a future age by entering the [After Age Change]. 9

10 Assumptions Surplus Allocation Golden Years accounts for pre-retirement and post-retirement cash flow shortages and surplus. Checking [Do Not Reinvest Pre-Retirement Cash Flow Surplus] makes Golden Years work more like Easy Money, ignoring the impact of cash flow shortages an surplus prior to retirement. Learn more: Easy Money vs Golden Years User Guide 10

11 Assumptions Other [Defer RMD Start Age Past 70.5 Until Age] If a client is working past 70.5 and can defer RMDs from employer sponsored retirement plans, enter the age to begin RMDs. If the client is not required to pay penalty tax on early retirement account withdrawals uncheck [Calculate Penalty Tax on Pre 59.5 Plan Distributions]. Uncheck [Include Retirement Plans in Asset ] to exclude retirement account assets allowing the specified reports focus on non-qualified investments. 11

12 Assumptions Other [Tax Favored Investment Educational Report] Used for a single report in Easy Money illustrating compounding power and the benefit of tax-deferred or tax-free savings. It also compares the future accumulation and income potential of various types of investments. 12

13 Assumptions Report Options Use [Net Worth Valuation Date] to show a specific date on the net worth report page, otherwise the date will default to the Cover Page Date. Choose a [Net Worth Style]: Bank Financial statement style with assets on the left, debts on the right. Consolidated Lists assets by type on top and followed by debts below. Ownership Columns of assets, debts and net worth per owner. Express Styled after the Express report available on the desktop edition. 13

14 Assumptions Report Options Enter the [Age for Future Detailed Cash Flow] to evaluate each income and expense item for the age specified. Specify how the list of assets on the Asset Details report page is ordered by setting [Sort Asset Details by]. 14

15 Assumptions Report Options Formatting Select report item to be left or center justified. Style the reports by selecting a [Report Font] and [Heading Color]. A preview will display with format and style selections. 15

16 Plan Data: Assumptions Thank you for taking the time to review TOTAL Online s assumptions guide. View more user guides: moneytree.com/guides Questions? Ask Money Tree s Support Team Toll free support@moneytree.com 16