A reinvestment technique in eMoney will reinvest an individual account or all accounts from its current asset allocation to a new model portfolio. Today, we’ll look at how to model a reinvestment technique in Advanced Planning and present the results to clients.
First, you’ll navigate to the Plans section of your client’s overview page. Click Add under scenarios and then click the AP icon to access your advanced planning techniques.
Next, you’ll add the reinvestment technique under Planning Techniques > Add a New > Reinvestment.
Then, follow the steps below:
- Name the reinvestment technique and select the year in which it occurs.
- Use Apply Taxes to determine whether the tax implications are considered when reallocating assets with the account. A transaction could generate capital gains or losses or could be regarded as a transfer at basis depending on the scenario.
- Use Transfer Expense if there is a cost for executing the transaction. Enter the value here as a percent of the asset value.
- Select Initial Allocation; if you want to use the current allocation by holdings or based off a model portfolio.
- Select New Allocation. Choose your recommended portfolio from our default model or one of the custom portfolios you’ve created in the assumptions section.
- Add the asset(s) you want to reinvest from the drop-down list and click Add Asset.
- Click Save.
For more information, check out our Modeling a Reinvestment Technique user guide.
Compare and Present in Reports
Now your recommended scenario will be available to apply in reports and the interactive planning tools. Using the reports such as Investments > Asset Allocation and Cash Flow and interactive tools such as Decision Center, you can compare the scenario to the current strategy and also show clients the impact reinvesting can make on their lifetime cash flow and Monte Carlo results.
Do you use Foundational Planning? Learn how to use the Asset Reallocation technique here.
Looking for more training? Check out our interactive user guides, webinars, and more in the Help section of your advisor site.