Morningstar Introduces New Retirement Planning Tool

According to the announcement, Retirement Income Strategist, which is available to institutions for use by financial advisers and registered representatives, allows advisers to create a retirement income analysis that is more or less comprehensive depending on the client’s needs. The tool’s capabilities include “what-if” scenario modeling of multiple variables, such as asset allocation/location, Social Security and pension elections, and saving more, as well as Quick Wizard modeling of the impact of retiring later, working part time, or reducing lifestyle expenses.

The tool combines Ibbotson Associates’ Wealth Forecasting Engine with Morningstar’s investment research and technology, the announcement said.

Other key features of the Retirement Income Strategist include:

• Methodology and capital markets assumptions from Ibbotson Associates,
• Tax-sensitive and inflation-adjusted Monte Carlo forecasting, powered by Ibbotson Associates’ Wealth Forecasting Engine, calculates the chance of meeting income and estate goals and forecasts year-by-year projections of wealth and income sources versus essential and lifestyle expenses,
• Customized cash flow model accounts for Social Security, pensions, required minimum distributions, and other income streams, income annuities, essential and lifestyle expenses, extraordinary expenses, stages of retirement, and other financial goals,
• Client reports: A one-page Scenario Report summarizes the chance of meeting retirement goals, as well as projections of wealth and income over time, and a fifteen-page Comprehensive Report compares base case and recommended scenarios, and outlines investor implementation actions,
• Morningstar educational content on retirement risks, including PowerPoint slides suitable for seminar presentations and brochures for investors, and
• Configuration options for institutions including co-branding, asset classes, and capital markets assumptions.