CPI (Consumer Price Index) and RPI (Retail Price Index) are default assumptions set on the software's Preferences screen. These index assumptions can be edited for the client case at hand in the Plan Preferences on the right side of the screen, on the Default Inflation / Growth Rates panel.
Lifetime Allowance - For the UK software, the future Lifetime Allowance (LTA) is escalated based on CPI. Read more >>
While not displayed as an editable preference, LPI (Limited Price Indexation) is also available as an option in the final salary escalation selection and will be calculated as equal to RPI or 5%, whichever of the two is lower (i.e. with a maximum of 5%).
How is RPI, CPI and LPI used in Voyant?
The CPI preference is used to escalate the Residential Nil Rate Band (RNRB).
These indexes can also be used (if selected) to inflate items such as escalating final salary and annuity payouts, when selected as an index on the Pensions > Final Salary screen.
These preferences can also be used to index the benefits and premiums on increasing lump sum and regular income policies - both are Benefit Type options for personal term policies, which are found on the Protection > Term & Endowment screen.
The software's Real Money simulation (an option available on the Let's See charts) displays present values of the calculation results using RPI to compute the present values.
Plan Preferences vs. System Preferences
Changes to this setting on the mirror Default Inflation / Growth Rates panel in System Preferences, on the left side of the screen, will be used only going forward, as you create new client cases. System Preferences are used as a template only for new client cases. Changes to System Preferences will not retroactively affect your existing client cases.
If you want to change this preference in any existing client cases, you will need to open and edit them individually, in each case's Plan Preferences.