Savings and Retirement Projections

Keep it Simple… but not too Simple!

Recently, I had a discussion with a new RazorPlan user. He told me in the six weeks since he started using RazorPlan, he had seen a significant increase in client engagement and a major improvement in case size and closing ratio when meeting with new prospects.

My first instinct was to point out the benefits of keeping things simple when discussing financial recommendations with prospects and clients. He agreed, but pointed out that some advisors can take simple too far.

To illustrate his point, he told me a story about a recent appointment he had with a new prospect to discuss their savings and retirement plans. Here’s the true story, told from the perspective of you, the advisor. (The names of the clients are made up to protect their privacy.)

roger-and-bea

Meet Roger and Bea

You were referred to Roger and Bea by their son Cecil who is a client of yours. A few months ago when reviewing Cecil’s life and critical illness insurance, you learned that his parents had recently retired and that they were dealing with a local investment firm to prepare a “retirement plan”.

Over the summer months, you attempted to arrange a meeting with Roger and Bea, but they were always busy enjoying the summer weather. You remained in contact by sharing various articles on savings and retirement strategies.

At the end of August, you contacted them to arrange a meeting after Labor Day to which they agreed, even though they did not feel there was anything you could help them with. After all, their current investment advisor had already prepared a retirement plan for them.

Read the full article on RazorPlan.com.

How three advisors use Razor Plan to deliver results

(This is a guest post by technology and digital media specialist, Jay Palter.)

by Jay Palter

When Dave Faulkner set out to design a new financial planning software, he had one primary goal in mind: to create a powerful tool that was simpler and easier to use than all the rest.

He saw many advantages in doing this. For instance, a simpler tool would mean more advisors could offer planning services to their clients. Also, advisors would spend less time crunching numbers and more time advising and helping their clients. Perhaps most importantly, a simpler tool would help clients to gain a better understanding of how their planning decisions would affect their financial futures.

For this article, I reached out to a number of financial planners and advisors that are actively using Razor Plan in their practices. Here are three of their stories.

Razor Plan helps Scott Plaskett focus more time on advising clients


scott-plaskett
Scott Plaskett owns and operates Ironshield Financial Planning, based in Etobicoke, Ontario.

Ironshield offers a range of financial planning programs and services to clients for a fee. For Plaskett, making the financial planning process a deliberate first step allows the client to really understand the plan and what’s involved in implementing it.

Razor Plan is the foundation of engagement with financial planning clients, says Plaskett. “Clients love the summary report page because they can see their options progress,” he adds.

As a former user of more complex financial planning software products, Plaskett became frustrated with their arduous process. Scenario planning was very involved and became a long drawn-out process.

“And it didn’t matter what scenario you created,” Plaskett says. “It never turned out that way.”

With a growing business, Plaskett faced a choice: hire a full-time financial planner or find better software.

That’s when he discovered Razor Plan and its unique approach to financial planning. Since we can’t predict the future, we don’t know what scenarios will unfold. But, Plaskett notes, we DO know what the options are.

Plaskett gathers data offline with his clients, then enters that data into Razor Plan and reviews the results with clients using the software. Razor Plan has so much more logic built into the calculations that it makes it easy for him to model different scenarios quickly.

“The software handles all the heavy lifting and allows me to spend more time advising my clients.”
~ Scott Plaskett.

Aurora Tancock’s clients know how ready they are for retirement

aurora-tancockAurora Tancock operates a financial planning practice, Aurora Tancock Financial Services, in St. Catharines, Ontario that specializes in retirement and estate planning.

Tancock loves the ease of use of Razor Plan, compared to other financial planning software in the marketplace.

Typically, she conducts a fact-finding meeting with clients after which she inputs their financial information into Razor Plan. Then, she brings clients in for a subsequent meeting and walks them through the information and analysis in the Razor Plan application.

The retirement options screen clearly shows if the client is on target and then allows Tancock to make easy adjustments to illustrate how working longer, saving more or taking greater risks with their investment portfolio will affect their readiness to retire.

Tancock meets with clients annually to review and update their financial plans. During these meetings she projects the Razor Plan software onto a television monitor which allows clients to easily see their progress towards their goals and feel part of the process.

“Clients love especially the one page summary that shows them where they currently stand and the four options they are given to work towards their goals.”
~ Aurora Tancock

Dan Anders likes Razor Plan’s client-centered design

dan-andersDan Anders is an independent estate and insurance advisor, based in Vancouver, BC. He specializes in the financial aspects of estate planning, and works with a national financial institution as well as his own clientele.

According to Anders, the financial industry has been doing financial plans the same way for the past 30 years and most clients don’t get much value from a 40-page financial plan. “What clients want is to know,” he adds, “is if they are on track for meeting their goals and what are the potential pitfalls along the way? That’s the beauty of Razor Plan – it gives clients the information they need and want,” says Anders.

Anders has used many of the competing financial planning products on the market and he likes the simplicity of Razor Plan. “It’s client-centric,” he says. “Most other planning software is designed for planners, but Razor Plan is designed for the client. And they express great appreciation frequently, because for the first time they clearly understand what we are trying to do for them.”

In his practice, Anders uses Razor Plan to offer clients affordable and meaningful planning services. Since financial plans are dynamic, they create meaningful reasons for him to sit down with his clients on a regular basis and stay up to date.

“As an estate and insurance professional, I’m not sure how you make an insurance recommendation WITHOUT a financial plan.”
~ Dan Anders

 

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It’s Not Just About Retirement Planning

I recently attended a presentation to a small group of financial planners leading up to on our upcoming release of version 4 of The Razor, our 4th since introducing it in 2012. In that meeting, we previewed a number of improvements and features the new version will offer financial planners to better engage clients in the financial planning process.

Listening to advisors in that presentation and a number of others over the past month have taught confirmed for me two things:

First, we nailed it. The feedback received after each meeting is a clear signal to us that we understand the needs of financial planners and we have delivered what they want.

Second, we failed in our most important message to financial planners. It’s not just about retirement planning!

Financial-planning-quote-Dave-Faulkner-Razorplan

On the surface, The Razor may appear to be just another retirement planning software tool. But The Razor is different; it’s not just about retirement planning, it’s about engaging the client to find what really matters so that the advice provided will be valued.

The Value of Clarity

All planning engagements must provide value to both the client and the advisor. The client sees value only when they feel more positive about their financial situation, while the advisor sees value only when the income to be earned is sufficient enough to allow for the amount of work that will be provided.

The advantage of The Razor is that it delivers value to both the client and the advisor equally and it does it all in one meeting with the client. Also, it doesn’t matter which sector of financial services the advisor works in, The Razor is effective for both investment and Insurance planning engagements.

Investment Planning

The Razor will identify potential problems with current savings and asset allocation strategies by estimating capital requirements based on the client’s objectives and return assumptions. It does this by automatically answering the most common questions clients have:. “How much can I spend?” “When can I retire?” “How much do I need to save?” and, “What rate of return do I need?”

Insurance Planning

The Razor compares the client’s income goal to the maximum sustainable income, creating opportunities to allocate excess cash flow to estate planning strategies. The Razor then estimates capital needed for income replacement, estate liquidity and terminal tax funding in addition to disability, critical illness and long term care needs.

Financial planning should be more about interacting with clients and less about crunching numbers. Value is not delivered by entering data into financial planning software and clicking the “Calculate” button. Advisors add value by helping clients understand what really matters and exploring the options available to them.

~ Dave Faulkner

In the real world, simplification is valued over complication. The Razor embraces simplicity and automation, without sacrificing precision, helping to engage clients interactively in the financial planning process.

To learn more, visit Razorplan.com and check out our new and improved version 4 software or register today for a FREE 30-day trial of The Razor.

Betterment offers automated planning, does this signal the end for human advisors?

Betterment, a US-based automated investing service, or “Robo Advisor” as they are commonly referred to, recently announced the release of RetireGuide™ – an advice engine that creates a free personalized retirement plan for account holders. While this move confirms the importance of financial planning in the investment management process, Betterment’s RetireGuide isn’t going to render human advisors obsolete any time soon.
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Defining the Problem

Albert Einstein once said, “If I was given one hour to save the planet, I would spend the first 55 minutes defining the problem and 5 minutes solving it.”

Although there is some debate on whether Einstein is truly the source of this quote, it illustrates an important point: before jumping right into solving a problem, you should take a step back and invest your time and effort into understanding it first. Continue reading