Before presenting a financial plan to your client, it's good practice to review both the information you've entered and the results Voyant has produced. Working through the plan in a consistent order makes it much easier to identify missing information, unexpected outcomes, or data entry errors before recommendations are made.
1. Review the Client's Information
Start by confirming that all of the client's financial information has been entered correctly.
You can do this by clicking the down arrow on the Dashboard to open all data in the plan.
Review:
- Income sources and employment details.
- Investment and retirement accounts.
- Properties and any associated debts.
- Goals and ongoing expenses.
- Insurance policies.
- Tax assumptions and planning assumptions.
- Ownership of assets and liabilities.
Even a small data entry error can have a significant impact on the long-term results of a financial plan.
2. Review the Timeline
Next, review the Timeline to confirm that major life events occur when expected.
Pay particular attention to:
- Retirement dates.
- Pension and government benefit start dates.
- Property purchases and sales.
- Windfalls and inheritances.
- Business sales.
- Roth conversions (US) or other planned account transactions.
- Major goals and one-time expenses.
Many unexpected results are simply caused by an event occurring one year earlier or later than intended.
3. Validate the Cash Flow
Once you've confirmed the inputs, review how the plan behaves each year.
In Year View review the following sections:
- Cash Flow
- Expenses
- Property
- Debt
- Investments and Retirement (Pay attention to contributions and withdrawals)
- Taxes
- Trusts and Corporate when applicable
Look for:
- Large spikes in income or expenses.
- Unexpected withdrawals.
- Expected contributions not occurring
- Large tax bills.
- Income shortfalls.
- Negative surplus income.
- Unexpected asset sales.
- Accounts depleting earlier than expected.
Comparing the affected year with the years immediately before and after often makes unusual transactions easy to identify.
4. Perform a Sanity Check
After reviewing the numbers, step back and ask whether the plan behaves as you would expect.
Questions to consider include:
- Does employment income stop when the client retires?
- Do pensions and social security benefits begin in the correct year?
- Do retirement accounts begin funding spending when expected?
- Are scheduled contributions occurring as planned?
- Are required minimum distributions beginning at the correct age (where applicable)?
- Does selling a property remove both the asset and its associated mortgage?
- Are debts paid down when expected?
- Does an inheritance increase the receiving person's estate? Where is the inheritance going?
- If one spouse dies, do household income and expenses change appropriately?
- Does the client have sufficient surplus income to fund all scheduled contributions?
- Is their surplus income going where you expect it to?
- Are dividend and trust distributions occurring as expected?
If something doesn't seem logical, it's often worth reviewing to what might be causing the unexpected behavior.
5. Review the Overall Results
Once the annual cash flow looks reasonable, review the high-level planning results.
Useful charts in the Let's See screen include:
- Cash Flow
- Assets
- Expenses
- Debts
- Net Worth
- Plan Worth
- Taxes
These charts help answer important planning questions such as:
- Will the client's assets last throughout the plan?
- When are investment accounts expected to be depleted?
- Are taxes higher than anticipated?
- Is Total Need fully funded throughout retirement?
- Does the estate grow or deplete as expected?
6. Stress Test the Plan
Depending on your planning approach, you may wish to assess how the plan performs under different market conditions and assumptions.
Consider reviewing Insights such as:
- Monte Carlo Simulation
- Historic Simulation
- Loss Capacity
- Retirement Spending
- Goal Priority
These Insights can help you evaluate how changes in investment returns, inflation, or other assumptions may affect the plan's outcomes.
7. Compare Alternative Strategies
If you've recommended planning changes, create a What If scenario and compare it with the Base Plan. Using Let's See > Compare Plans.
Look for measurable improvements such as:
- A higher probability of success.
- Lower lifetime taxes.
- Higher estate values.
- Reduced shortfalls.
- Better achievement of the client's financial goals.
Comparing scenarios helps confirm that your recommendations produce the intended outcome.
Final Tip
If you encounter an unexpected result, try to identify the first year in which it appears rather than focusing only on the year where the impact becomes obvious.
Many planning outcomes, such as capital gains tax, account depletion, or changes in withdrawals, are the result of decisions made in earlier years. Reviewing the years immediately before and after an unexpected change will often reveal the underlying cause much more quickly.