0:06
Okay, good morning everyone. Happy fall. Hope things are going well
0:12
where you are. Had a couple mornings of frost in Colorado lately.
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Um we will get going in uh just a few minutes once we get everybody in the
0:24
room. Um, today is our normal monthly lab talk
0:30
Tuesday Q&A session. Um, next week I want to point out we're
0:37
having a uh our our normal retirement income intel session. It'll be me and Derek and we're going to be talking
0:42
about artificial intelligence in financial planning and really in the advisor world in general. Derek's um uh
0:51
pretty cutting edge guy when it comes to technology. Uh and we'll be uh we'll be going over a lot of what's out there,
0:58
fitting AI into your practice, and also spending a lot of time on the new AI um
1:04
features from Income Lab. So, we're going to spend some time today on those uh here as well. But if you're uh if
1:10
you're not uh satisfied with the with the coverage today, please come back uh or even if you are, come back next uh
1:17
next week. Should be a fun conversation. Derek is having trouble with his camera,
1:22
so he's gonna be back here. But um let's go ahead and get started. Uh so as
1:27
usual, agenda for today is we'll talk about new um features first. Uh we
1:33
sometimes tease uh coming features and then we'll take pre-submitted questions
1:39
and then any questions that everybody has. Um, so if you are if you do have questions today, please put them in the
1:45
Q&A section rather than in the chat. Um, feel free to use the chat, but um but uh
1:52
the Q&A is much easier for us to uh to kind of manage. Um, and if you have if
1:57
you see a question that you like and you want us to answer, please upvote it by clicking I think it's a thumbs up uh
2:03
icon so we can kind of get a feel for which ones to address. Um, sometimes we can get to all of them, most of the time
2:08
we can't. So that really helps us. Um, so with that,
2:13
let's kick it off. Um, so first thing as usual is uh is new
2:19
features. And this is I mean honestly this year has been amazing for Income Lab in terms of new things that we've
2:24
added to the the software. Um, everything from the social security
2:30
optimizer that we launched a couple months ago to these new AI tools. So, if you haven't um kind of seen some of this
2:37
new stuff, and I just got an email from uh uh one of our longtime uh adviserss who uses Income Lab, a big fan of Income
2:44
Lab, and he was just saying how he just discovered the Social Security optimizer. So, like these are things
2:49
that I think it's possible that people, even longtime users, have missed. Um so, please have a look. Um you know, I've
2:56
even talked with adviserss who don't fully know about Tax Lab and the ability to do Roth conversion planning and
3:01
income lab. So there there is so much um that I want to make sure people are are
3:06
getting uh you know getting the value out of that. So today I'm going to start with a new
3:13
um beta feature although it's it's very I think close to coming out of beta um
3:19
which is the pre-retirement planner. So if you go to decision lab you will now
3:24
see not just the social security optimizer but the pre-retirement planner. You'll also see that an investment strategy tool is coming soon.
3:32
Um not sure yet exactly what we'll call that one, but uh that that will be out in the next about month. Um so the
3:39
pre-retirement planner, just like the social security optimizer, is about really zooming in on a a small set of
3:46
questions that you would often have um conversations about with with clients.
3:52
And this one is about, you know, when can I retire and how much will I save? So, it's really like putting blinders on
3:58
and really zooming in on that. Um, the way that it's uh works is you first need
4:04
to provide a little bit of information. So, this is a really simple plan. This is just one person with $10,000 a month
4:11
in salary. Um, and then it's going to ask you,
4:17
okay, well, how much would you like to spend per month when retired? Um, or this another way to view it is, okay, what's your target uh retirement
4:23
paycheck? Um, I'm gonna go to just a 100% replacement ratio because uh
4:29
because I want to and I know the numbers will work out well. Uh, and then it's going to say how much
4:35
are you willing to save each month. Um the if you already have a fully built
4:42
out plan that has some savings in it, you will have the option here to decide
4:48
whether you want to start fresh, meaning like wipe out all of the savings that you already have um and start from zero
4:56
so that you can truly examine, you know, and here I have it saving from uh 0 to
5:01
$2,000 a month. Um, so you can say, "Hey, I really want to go from like
5:06
first principles here. How much should I be saving?" Or you can say, "Well, no, leave that stuff in the plan and I want
5:13
to explore how much more uh I might want to save." By default, we're not going to include the existing um savings from the
5:20
plan because we suspect most people will want to do that first principles like
5:25
let's start from zero and explore a range. But super easy to to just click
5:30
on. I I should have created an example here where I had some savings, but you would see them listed here and you'd have a little check box that is
5:37
currently grayed out. I can't use it. Um, but it uh it says in addition to the saving range above, include all savings
5:44
items already in the plan. And I could check that box. Um, so not relevant here
5:49
because I don't have any savings items in the plan yet. Um and then here um is where we say hey
5:56
what what kind of range of years um do I want to explore. So let's say I want um
6:04
you know somewhere between age 65 and age 63 for this person. You can do as
6:10
long of a range as you want but we are going the minimum number of like range to explore is fi five years. Um, so that
6:18
would be like, you know, 2030 to 2034, right? Because it's 30, 31, 32, 33, 34.
6:24
So don't get fooled by by the math. Uh, 30 to 34. That's 5 years inclusive. Um,
6:30
so I'm going to do, you know, kind of a broader one here so that maybe this a person likes his job, but just sort of
6:35
looking at uh um, you know, a broader range. And I'll hit continue. Get a
6:42
little bit of information um about what I'm about to see. It's going to be a a heat map just like um kind of used to
6:50
seeing in in the pre in the social security optimizer. And now what it's
6:55
doing is running. Okay, it's the exact plan that I already have with and it's a
7:01
full income lab plan. So this is not um you know shortcutting and using like
7:06
time value of money on a financial calculator type stuff. So it's including everything about the plan. It's you know
7:14
investment risk. It's inflation risk, it's mortality risk, it's, you know, timing of cash flows. It's all that
7:19
stuff. And it's giving you the projected monthly retirement paycheck for each
7:25
combination of um retirement year and uh
7:30
monthly savings. And we I set my target at $10,000
7:36
of and this is gross of tax. And it's going going to in this case I can just
7:42
like in the um pre-retire or the uh social security optimizer I can you know
7:49
set a a level of target highlighting or I can turn that off completely but I I
7:55
personally like it. Um so maybe I want to say well show me everything outline everything that's within 5% of um
8:04
of the uh of the goal here which is 10,000. Um, and you can see, okay, it
8:10
looks like retiring in 2037, um, when this person, I think his name
8:17
is John, yep, is 67. And saving $500 a month, that's, you know, that that's
8:23
right on, right? $9,990, uh, which is pretty darn close. Um now
8:30
interestingly if he's willing to actually spend a little bit less and you know who knows if maybe we have good
8:36
returns in the meantime too he could actually save nothing and be at 9560.
8:41
So this is a really great way to kind of talk about the range of things uh that
8:48
this client could do. Uh maybe sort of start imagining like you know or you could retire in 2035 save nothing. are
8:55
you if you're willing to live on, you know, 8,000 instead of 10,000, right? Um
9:00
and see really how different sets of savings and retirement date work out. Um
9:09
one thing you'll notice is um the heat map paints darkest the places that are
9:16
closest to your goal, which is you can actually change your goal down here on the on this little slider. So, even
9:23
though of course waiting until 2043 and saving $2,000 a month produces a higher
9:29
retirement paycheck, of course, right? I mean, waiting till 90 would be even better. Um, why is that? Well, you have
9:36
more time for it to grow. You have more time for savings and you have a shorter plan from that point, right? So, all those things are having an effect. Um,
9:43
but that's not painted darkest because it's not just about how can I have the highest retirement paycheck. It's about
9:50
how can I reach a goal? Um, and so the cost of waiting an extra six years um is
9:57
high and the cost of saving $2,000 more per month is high. So it's not just, oh,
10:03
let's let's make Darkest the area that has the highest number. Um, but you can, you know, with the client, you say,
10:09
well, you know, I mean, maybe maybe we do want something more in the $4,000 range. Oh, okay. Then we're looking at
10:14
kind of a, you know, $2,000 a month.
10:19
um and 2039 or maybe it's $5,000 $500 a month and 2041, right? So, you can kind
10:25
of move these things around um or way down here on the on the low end, right?
10:31
So, this is a really nice way to um to kind of move around what you're looking
10:37
for and have a conversation about the the costs and benefits of retiring earlier or later, saving more or less.
10:44
Um so, really cool stuff. Uh, but let us know um what your what your thoughts are here
10:51
if you if you've had a chance to uh to uh to have to play with this. Uh and if
10:56
not, please please do. Um Jason asks, is there any reason this
11:03
heat map shows two-year increments? It's because um I put in, hey, I want to
11:09
explore between 2035 and 2043. And so it's just going to split that into five.
11:17
Um, so what I might want to do, so it's always five, right? So it's always five.
11:22
If I put 50 years, they'd be 10-year increments, right? Um, so if you want it
11:27
to uh shorten, for example, when I when I was at my 10,000, it was, you know, 2037. I might want to now go in here and
11:35
say, you know, give me um, you know, 2034
11:42
to 20 um 38. I think that'll be
11:51
five. And now we get one year increments. Um, and so we can kind of explore it a little bit
11:56
a little bit closer. Um, same thing goes with the uh with the
12:02
savings. So, it's going to take I said 0 to 2,000 and so it's just taking even increments uh for monthly savings there.
12:13
Uh can you give us a preview of the investment strategy? I wish I could. I actually looked the other day to see if I had a uh uh a version in one of our,
12:20
you know, um development or QA uh environments and I don't yet. But the
12:27
concept is going to be similar. Um, again, put those blinders on and say, "Let's focus on this one task of
12:36
exploring the the effects of investing in different ways on our retirement." Um, and so in that one, I don't believe
12:43
it will be a heat map. Heat maps are really only usable if you have, you know, three-dimensional things. So, this
12:49
you've got, you know, how much am I saving, when am I retiring, and then the amount uh is the the color. Uh, so it'll
12:55
be, I believe, a a bar graph, but um it's going to have some really cool stuff to help you explore the again the
13:01
trade-off because what typically happens with an investment strategy is yes, you
13:06
could invest more aggressively and that probably will increase your spending capacity, but it
13:14
will also increase the volatility of your income. And so we don't want people to think it's a free lunch, right? We
13:19
want them to understand okay yeah uh what sort of person are you are you the kind that is okay with that volatility
13:26
in exchange for higher income or you know um is it more like we need to discover
13:32
sort of the um Ryan Townsley calls this the risk requirement. So you know how risky do we essentially have to be in
13:40
order to hit your goals and then anything above that is kind of about preference. So, how much more flexibility, how much more chance for
13:46
higher income and so on do you want? Um, and so that's what that tool is going to be focused on. Uh, we should I should be
13:54
able to demo that. It may even be out by um by the next time we have a um a uh
14:01
retirement uh or sorry, a lab talk Tuesday in November.
14:06
Man, this year is just just amazing how quick it's going. Uh how does this
14:11
account for inflation? This is assuming that your, you know, $2,000 a month is
14:19
being adjusted for inflation. So, it's not a nominal $2,000. It's actually increasing with inflation. We did that
14:26
because um you know, often what we're talking about is it's it's something
14:32
from your salary. You know, often people are getting cost of living adjustments. And so, that seemed like a reasonable a
14:39
reasonable approach. Um the rate of return it's assuming is what's ever in the plan. So this is
14:45
really it's taking the entire plan that you have with its portfolio allocation
14:51
with its uh cash flow. So this this plan has social security in it um the timing
14:58
of everything even if you had um you know variable expenses a legacy goal all
15:04
of that. It's holding all of that constant and it's just varying these two things. Um, so that's where this is also
15:12
um or yeah, it would have the retirement smile. Um, it would have all of those things. Um, and maybe just to dwell on
15:19
how this is different from what you might see in in other software. Um,
15:24
well, first of all, it's allowing you to explore, in this case, 25 examples instead of one, which is usually what
15:30
you would see in kind of a, you know what, they're called things like, oh, the playground or the, you know, the
15:36
what if uh center or things like that. And usually what you do is you look at your current plan and you look at that
15:42
plan with whatever changes you want in it. And that is a very useful feature and I think income lab is uh we're
15:49
working on a similar thing to help you. But what you're doing there is you're only comparing two and in this case you
15:55
just get all right here's let's really try to look at the whole landscape of things we could do. The other thing is
16:00
that this is focusing on how much you can spend. Whereas typically what you'll see with kind of legacy planning
16:07
software is that it focuses on probability of success. And so you might see something like um oh if I retire in
16:14
2037 and save $500 a month, my probability of success went up from, you know, 80 to 90. Okay. But it doesn't
16:23
really get at the uh well, we already know, you know, we have problems with probability of success. There are big
16:29
problems with probability of success, but even if we were okay with it, it doesn't actually zoom in on the question
16:34
people have, which is can I retire at that point? How much could I spend? Um, and so that's the great thing about we
16:40
took income labs focus on that question of retirement paycheck or spending capacity and that's what's being
16:47
displayed here. So you can really view these different kinds of behaviors, these different options as having an
16:53
effect on how much you you would be able to spend by that point, which is that's the point, right? That's what people
17:00
really want to know. They're not saying, "Hey, I have a you know, I want to see all of my results in probability of
17:06
success." That's a thing that advisers because of the software that they use uh tend to bring to the conversation and
17:13
have to teach clients about. You don't have to teach clients about spending capacity or retirement paycheck. That
17:18
just kind of is how they're already thinking. Um, does a heat map account for monthly
17:24
spending being increased over time? Yeah. So, it's um this is truly this is
17:30
the same concept as you would have in a normal plan of retirement paycheck or spending capacity. So, it's saying given
17:37
everything in the plan, this is how much you could spend um
17:43
at the beginning. So, if you have a retirement paycheck that has a um
17:49
a-based or smile structure to it where you spend more early and then you spend
17:54
less later, that's included. If it's flat, just inflation adjustment, that's included. So, it's it's truly a full
18:02
plan. and you're just getting like a peak into um you know what the what the retirement paycheck of that would be.
18:10
Um it it can appear sort of like deceivingly simple that you see this,
18:15
but there's actually a ton of analysis that goes into just giving you this number.
18:23
All right. Okay. Does a normal plan need to be
18:29
created prior to using the pre-retirement planner? Yes. So, what what this is doing is um it's all of the
18:38
things inside Decision Lab are about taking a plan that you already have. Could be a very minimal plan. Um for
18:44
Social Security, for example, you really only need Social Security to be in the plan. I mean, any plan requires at least
18:51
one uh investment account, but that's basically all you need. For a pre-retirement planner, same thing. Now,
18:58
that said, it's best used if you, you know, have a pretty decently filled out plan with all of the resources at least
19:05
that that are available. Um, so it's kind of once you've built the plan with
19:10
all the resources, now you're asking these questions. Okay, when should I take social security? Okay, when you know how let's explore how much we might
19:17
be able to save or not. Let's explore a range of retirement dates. Um, so yeah,
19:23
that's that's sort of the workflow is first build the plan, at least a resource-based plan, and then come in here and and you can see you're it's
19:30
actually these tools are actually within a plan. So, um, you know, these little
19:36
uh breadcrumbs across the top, they say, okay, the household is named pre-retirement example. Uh, the plan is
19:41
called household plan, and I'm in the tool called decision lab. Um, you can once you're in there,
19:47
actually, I don't have any other plans for this household, but if you wanted to, you could change plans from within
19:53
within the tool. All right,
20:03
let's get to uh Okay, one more question. The assumed inflation rate, is there a
20:08
place to see that? Um so
20:14
it's it's up to you what your inflation rate would be. Um you know for example
20:20
if if I'm using I'm here I went to settings capital market assumptions I
20:25
can look at u my inflation assumptions here if I'm using um kind of standard
20:31
Monte Carlo uh currently our default is 2.52% with a 0.99% standard deviation.
20:38
This, by the way, this a we probably don't make a big enough deal of this. This is a huge
20:45
feature of income lab. As far as I know, no other planning software treats inflation as a risk.
20:52
What do I mean by that? I mean by varying it, by allowing it to possibly be different than your assumption. Um,
20:59
so sometimes people will hear me say, you know, other software doesn't treat inflation as a risk. And you say, no,
21:04
no, I have an inflation assumption in there. Yeah, but it's a fixed inflation assumption. Uh, and if it's fixed,
21:10
that's not treating it as a risk, that's treating it as a known. So things are only risky if they're unknown and variable. Um, so this is a pretty big
21:16
deal. Um, so depending on how you um do your analysis, that's that's what's going on there. And you can change that.
21:22
you know, most people wouldn't, but um all right,
21:30
let's go to I want to get to some of our other uh um new features here because there are
21:37
so many and I do want to get to your questions and we're already 20 minutes in. Uh so another thing, this is really
21:42
important. So we now have a new kind of help and resources section at the top
21:47
here. Um, so it contains
21:53
all sorts of things. You got our new AI assistant, which I'll demo in a second. You have access to our self-guided
22:00
training, which will take you through the app and show you where to click things and so on. Live support, um,
22:06
which will allow you to chat with either by text or by audio, um, I think even by
22:13
video if you wanted, uh, with our support team. they can see where you are
22:18
in the app and help you, you know, if it's just like, "Hey, where's that thing?" You say, "Oh, it's just to the left of your mouse. Great. Thanks. I'm
22:24
done." Right? Um or could be much more involved than that. And then also access to our income web community where
22:30
there's a lot of action going on there, people helping each other. Um it it's great. I want to focus on the AI
22:36
assistant first, which is essentially an income lab expert sitting next to you.
22:43
Um, so it it you you chat with it just like you would any kind of AI, you know,
22:49
agent. Um, and ask it anything. Ask it how to do something. Ask it, you know, how can I present guard rails to a
22:59
client. Um, and it will give you answers. Um, it could be, yeah, more of this kind of
23:05
thing about communication. It could be about how to use the app. It could be um
23:11
uh a question about some you know tax issue like what's what is Medicare Irma um you know things like that. So
23:20
it will typically for for a more you know involved question like I just asked it'll kind of give you like a short page
23:25
worth of um of answer right so okay explain what are guardrails what's their
23:32
purpose illustrate how they work um sideby-side comparisons and so on maybe
23:38
it's something more specific like what's the difference between wages and self
23:46
employment income uh because you know if you're putting in
23:52
income in a plan you've got a bunch of different tax um
23:57
tax options tax treatments um and so what you'll notice so there's
24:02
wages and self-employment income so what's the difference here um well it the difference is basically how FICA is
24:09
treated social security and Medicare taxes um you know maybe it's something more general like
24:16
what's Medicare Irma,
24:24
right? Get it? I mean, it's even giving you, you know, the the numbers here. So, this
24:32
is an incredibly um helpful tool. Uh it should be the the first the first place
24:39
that um that we go for things. So, um yeah, please please check it out. uh and
24:47
let us know. So, okay, how trustworthy is it on technical questions? This is a great great question. So, we've built
24:53
this in a way that it is not just sort of um using the uh you know uh massive
25:03
uh information on the internet. So, it's not just kind of going out and hallucinating. is all based on
25:12
things that are built by income lab, information provided by income lab. So
25:18
yeah, that's a really great question. I'm sure for anyone who's used AI and we'll talk about this with Derek, I'm sure, uh next week there is the problem
25:25
of hallucination, right? So um so if you ask it, you know, uh what's the weather
25:33
in Cleveland? Um, it it's just going to say, "Sorry, I
25:39
don't have any information about that." Um, and so that's, you know, I mean,
25:45
it's even saying it in a really helpful way here, but I would be fine with it if it just said, "Sorry, can't help you
25:50
with that, right?" Um, so, so that's the key. And then as for whether it provides citations, um, it usually does. Where
25:59
did I Oh, you know what? I think I I think it got rid of it when I asked the what's the weather in Cleveland. Um but
26:04
if I ask what's the Medicare Irma again I think
26:11
it provided me some links
26:19
so similar answer um it airs on the side of providing quite a bit of information which I think
26:25
is is good but you can see here you know we can go to Medicare Irma bracket
26:30
management and there's more information there So great question.
26:36
Um, uh, can it be help you use income lab?
26:42
Absolutely. Um, so like how do I enter an annuity?
26:55
So, it's going to give you step-by-step directions and then also give you access to a tutorial video. um and and other
27:03
links there. Um this is also a place where we have um up here self-guided
27:11
training on things like that like oh click here, click here, right? That's that's where you go.
27:19
Okay. Um I said there's a lot today. So we'll get to more of them. All right.
27:24
So, the other um big AI features that we
27:30
just launched um last week are the AI plan builder and the AI interviewer. Um
27:38
this AI plan builder, we we're going to spend a lot of time on this next uh next week, Derek and I. Um but it is
27:45
essentially going to change the way that people build and update plans. Um, I
27:52
don't think it's overstating it to say that, um, with this, the days of an
27:59
actual person using their fingers to type on a keyboard to put letters into little white boxes on screens, uh, that
28:06
will be over soon. Um, and so we really we wanted to in working with Derek and
28:13
other other people um in the advisor community, we really wanted to address some of the pain points that get in the
28:20
way of um of really you know more efficient uh um
28:27
uh you know running of your practice, right? And so this is essentially going
28:35
to take whatever information you drop in and you can either drop it in as a document or as text or as both. Um, and
28:43
it will search for relevant information to build an income lab plan and build that plan for you and then present it to
28:50
you in a way that you can review it before going forward. Um, it even then
28:56
drops you into lifehub where you can review it again. Um, so what form of
29:01
data input do we need to use to make the I AI plan builder work 100% accurately? So this is a really good question.
29:07
Obviously if you're dropping in anything that doesn't have the information you need, it won't be able to find it,
29:12
right? It can't guess. So we the idea behind this was uh that there'd be a lot
29:19
of uses. One obvious use is um taking an existing financial plan. Um
29:26
like new users to income lab often ask this. Is there any way I can you know just transfer over my plans from you
29:33
know e-moneyguide pro right capital? Um now the answer is yes. But of course
29:38
that document better contains some useful information or else it's not going to work. Um the other thing here
29:44
is that it it's I think 100% accuracy is probably too much to ask ever. um
29:49
because it is it's just searching unstructured data um and and trying to
29:55
find them. The nice thing is you will see all of the outputs so you'll be able to um to uh to track that. Uh let me see
30:04
if I can why this is not coming over.
30:16
I'm going to pull in a file here.
30:27
You know what I'll do instead? I'm just going to uh
30:38
I'm just going to drop in some some data. So Derek, I know, did a uh
30:46
um a uh a video on this where he just did a
30:51
voice memo. But let's imagine this is the output of Dererick's VO voice memo. So I've got, you know, John and Melissa,
30:58
3 million. I list out what they've got. Couple things on social security, joint mortgage, pension,
31:05
right? Um primary residence, vacation home, right? auto loan, do all that
31:12
and then just hit start processing. Um, if you want, and this is this is
31:19
another use, you know, if say you have a um, I don't know, a right capital plan, drop it in. But, you know, it doesn't
31:24
have information on social security, well, just put that in the text box, right? So, now you have a a document and
31:30
some text. Um, so you can mix and match in that way. Um, and then what you're
31:35
going to see is, um, let's see. This, this actually will be
31:42
extremely fast. So, it's typically about a minute. Let's see if it's there yet. Sometimes takes a second to no. So, I'll
31:50
I'm just going to go here instead. So, this is essentially what you would have seen here. Um, it's going to say, okay,
31:56
I found six fields that were undetected. So, you can then use this little thing in the upper right to to skip to those
32:02
different fields. Um, and you know, it's either undetected or
32:09
like, you know, it's kind of making a guess, right? So, like in this case, pension, ordinary income. Yeah, not bad.
32:15
Might choose investment income for rental property. Okay, it didn't get the end of the auto loan. Okay, makes sense.
32:22
I'm just going to put it in. And then, you know, I can check all the other stuff. Yep, this is all exactly as it
32:28
was. Social Security is correct. all these balances are correct and then
32:35
create household plan. So, anything that I we're also going to
32:42
provide a lot more training on kind of what sorts of things are to that
32:47
question earlier, what's the best kind of input for this, right? It's the input that has the the most uh of the
32:53
information that that is that income lab needs, right? So, it's your resources, it's it's social security, it's it's all
33:00
of that. So, and then we take you straight to LifeHub so that again you can just expand it and just make sure
33:05
yeah this this looks correct or make any any fixes. Um I don't know Derek if you
33:12
have any uh comments on this or you know things to share before we move on.
33:18
Yeah, I mean for me it's just been fun to play around with like all the different ways that you can get
33:23
information in there. Um and then once you kind of find a system, um I have found like certain reports might come in
33:30
better or worse than others. There might be certain structure. Um we've seen some advisors using like their financial
33:36
planning questionnaires and uploading those in there which can work really well, but maybe there's like I don't
33:41
know it it just doesn't like the way social security is formatted or described or something. So you kind of
33:46
have to play around with that and see what works for your particular system. But um yeah, I I think this has really
33:53
helped me get done with the meeting, especially initial call, try to get all the information that I need, drop that
33:59
into that, um plan. And I guess just another thing to think about as you're like maybe on a call or in a meeting
34:05
with somebody. It's just making sure you're trying to cover the relevant areas. All the more reason to, you know,
34:10
sometimes um maybe more like an inerson meeting when somebody says, "Oh, you know, here's my statement." um you know,
34:17
maybe trying to get in the habit of saying, "Okay, you know, I see there's 1.1 million in your 401k, there's
34:23
300,000 in your IRA, like verbalizing some of those things that otherwise maybe we just look at the statement and
34:29
not say um is going to help you out as well as you're trying to take advantage of the the tool. So, just just think
34:34
about how you're getting information in and how you can kind of optimize that." Um and yeah, really excited to see what
34:41
advisors will do with it. Yeah, and there's there's more to come here. We had a question about, you know,
34:46
using it to update plans. Um, yes, that will be out soon as well. So, our our first, you know, version of this is just
34:52
for creating new plans, but, um, we're working hard on the plan update version. Um, there's, um, you know, all sorts of
35:00
other use cases, and I think we're going to learn new ones, but our team is working on a fillable PDF that you'll be
35:06
able to use if you don't already have a client intake questionnaire that you could just upload that PDF then. But as
35:13
Dererick said, many people already have their own questionnaires. The I think what's really exciting here is usually
35:20
software kind of asks you to play by its rules, right? Like you have to learn a
35:25
new system. What's great about the AI plan builder is it will play by your rules. So like assuming that you
35:31
actually are giving it the information it needs, it doesn't ask you to do it in any particular way. Um, so Zoom
35:39
transcripts, uh, summaries from a from an AI notetaker, you know, all of those
35:44
work really well, voice memos that are transcribed, right? So, we'll be expanding,
35:50
um, and, you know, tweaking things as time goes on, covering more input items, right? Right now, we just we tried to
35:56
cover all of the most important things and some of the little income lab stuff that's, you know, super nitty-gritty.
36:02
It's not going to be as covered because normally you wouldn't see that in a in a you know, a right capital plan or something. There's no such thing as a
36:08
guardrail in a right capital plan, right? But eventually we'll cover cover all of that um and do plan updates. So,
36:16
um will it integrate with Zach? uh we are
36:22
talking with you know all the big AI uh notetakers for advisors I think right
36:27
now and Derek could probably show more of this next week as well. Um the there
36:33
are some things we can do to make working with Zox or you know jump or something even easier but for now even
36:38
just clicking the you know copy and then paste into the text box uh will get you an amazing plan if
36:46
you've covered things in that um in that meeting. So, um, yeah, same with
36:52
Fireflies and and and all of that. So, um,
36:57
yeah, and Keith, same thing about adding a document to an existing plan with that coming soon. I'd say before the end of
37:03
the year, you'll see that. So, I don't know. This is just I think this is super exciting. And like for advisers, you
37:09
know, or I was joking with the team like I I wouldn't buy a robot that would play with my kids for me, but I would
37:14
definitely buy a robot that would fold the laundry, you know, and so this is essentially folding your laundry. like it's okay. We're getting rid of things.
37:20
No one actually enjoys typing into little white boxes, right? So, um this is going to be Yeah, I just think in,
37:28
you know, it might take some time, but uh as we kind of change our way that we run our businesses, uh I think we're
37:33
going to see some big big changes in hopefully, you know, improvements not only in clients uh outcomes, but
37:41
advisers as well. Um, the other one, and I know we're like almost running running
37:47
through time here, so I apologize that we're not going to get all the questions, but it's the AI interviewer.
37:53
Um, and this is essentially a client intake uh form, but done via AI chat.
38:00
So, it's again just like we were seeing kind of with the AI assistant, it is
38:06
extremely focused. So, it will not answer the, you know, it's it's you're not really chatting with sort of a wild
38:13
out there AI. It's not going to answer any of your questions. Um, it's just going to ask things like, can you tell
38:19
me about your investment accounts? How many do you have? Um, you know, do you have any you do you own a home? You
38:25
know, things like that. And if the client tries to get it off track, it'll just say, I'm sorry, I can't. Uh, you
38:31
know, that's not that's not what we're talking about today. Um, what's nice is it's also set up to handle basically any
38:39
level of information you get. So, it encourages people to, you know, estimate and be general and so on. Um again
38:47
excited to see what the use cases are that advisors come up with. But the main ones we have in mind are you know maybe
38:53
your um your growth strategy involves you know some higher volume some um
39:00
maybe it's uh you know seminars or um talks or or or whatever. This is a great way to kind of get something out to a
39:08
prospect and um get some information and then you'll see it appear in your
39:14
household list. Um you know as ready for review. You see this little um this
39:21
little icon here tells me it was an AI thing. I have a little bell up at the top with some notifications, right? Um
39:28
so lots of uh lots of ways to just let you know that what's what's happening
39:34
there. Um
39:39
folder of sources for each client. Uh we are working on that as well. So for now you're just you know it's you're going
39:45
to have imported your own stuff, right? So you'll already have access to it. But we do yeah that was a thing we thought you know people are probably going to
39:51
want to be able to go back and see hey what was that again that I put in. Um so yeah you'll you'll have that very soon.
39:56
a uh just a place to find things you've uh you've uploaded. Um for now, we
40:02
actually don't save the things you upload. Um it's just we we process it. The only output is the financial plan
40:09
itself. Um and so there really is no Yeah, there's we'll change that once we
40:14
allow you to, you know, access those. But for now, those things are, you know, that m that message uh self-destructs
40:22
and uh we don't have it anymore. All right.
40:31
Uh, will the previous AI analyze plans and make suggestions and areas of concern?
40:36
No, it will not. Um, although that is also, you know, you're not the first
40:41
person to think of that. So we do have plans to kind of help the AI and in this case I assume you're talking about the
40:47
AI assistant to give the AI assistant access to
40:53
um to understand a particular plan. So it would be able to see your inputs, be able to see your outputs and sort of
40:59
give some some feedback uh based on those. But for now it's general. So it's
41:04
not about a specific plan. It's about income lab in general, how to use it, how to present guardrails and so on and
41:09
not about hey why does this plan um I don't know have a lot of income
41:15
volatility you know that that is not the kind of question I can answer yet but uh stay tuned for sure
41:23
all right um so for today we are have a very short
41:31
amount of time to handle presubmitted and uh live questions so maybe I'll just pick a few here. Um,
41:42
all right.
41:47
So, here's a good one for you, Derek. Um, what are best practices for clients who don't want to spend anywhere near
41:54
their spending capacity from both a client conversation standpoint and a working within the software standpoint?
42:01
I think for me a lot of the times I will try to show them what that capacity is
42:06
like you know let's say it's somebody who wants to spend or they're currently spending 5,000 and they could be spending 15 right like it's way way out
42:14
of whack like trying to have that conversation of okay you really could spend more and if you're not spending
42:20
more you know here's kind of the path you're on where this just going to grow it's going to accumulate um you're going
42:25
to have have to do something with it at some point u so I do think you know going into uh you know even one thing
42:33
you could do is you could set a version of the plan where you don't increase the spending. So basically turn off that upper guard rail and kind of show
42:41
through some uh you could use the um stress test to show through some periods
42:46
of time how that portfolio even accumulated going through that. Um and just trying to put some actual real
42:52
tangible context to kind of what path somebody could be on. Um, then the
42:58
second thing I think I'd look for is like, you know, are there maybe people are thinking about spending on
43:03
themselves, but is it actually more giving or something else that they'd rather be doing with the money? Um, you know, how do we have that kind of
43:10
broaden what we could be doing or helping family out or going on a trip? You know, kind of some of that just uh u
43:16
kind of vision planning, I guess, in a sense of like what does somebody want to do? And then the third thing I I would
43:21
be looking at depending on the situation is also what type of income streams we
43:27
have for somebody. I just had a client who um was somebody who was wanting to delay claiming social security and I
43:33
kept telling them you know you can take more from your portfolio. You can take more from your portfolio even with delaying. Delaying was perfectly fine in
43:39
their situation. Um and they just didn't want to take more from their portfolio. But we said, you know, okay, well, you
43:46
know, they actually said, well, what if I instead of increasing my portfolio distributions by 2500 a month? What if I
43:51
just claim my social security benefit? And I was like, yeah, you know, as we're running the numbers, I think that made
43:57
perfect sense in their case. Um, you know, they were they were a candidate who could have delayed claiming, but
44:02
they were just so averse to to spending their portfolio compared to their social security that um I think at least we got
44:08
them nudged in that direction. So, kind of long-winded answer, but those would be like the different levels of walking
44:14
through that process. I'd be looking at, right? Um, we also have a question about how
44:21
income lab does um handles longevity.
44:26
So, this is a it's a really good question. It's one, you know, kind of like inflation. We probably don't focus on it enough because honestly, it's a
44:33
pretty cool pretty cool part of the software. Um so one question was about
44:39
where we get our actuarial um information from. So by default an
44:45
income lab plan is based on actuarial so mortality tables and we are using
44:52
society of actuaries retirement plan participant mortality tables which are
44:57
not the same thing as kind of a general population or social security mortality
45:03
tables. They are for people who are a little longer lived. The idea is there
45:08
is that if you're working with a financial adviser, you probably have some assets, lot of data on the fact
45:13
that people, you know, in higher asset or income levels uh do live longer. Um
45:19
and so we're taking that into account. That was one of the questions. Um and then instead of just asking you to kind
45:25
of pick a pick a date, um we're we're prefilling this. So in this case, we
45:30
have two people. And by the way, the plan is going to be based on their joint life expectancy because, you know,
45:37
you're going to need a plan for whoever lives longer. And so that's that's what you're seeing here. Um, and then you're
45:43
able to choose kind of, you know, maybe, you know, they're both extremely below average. Okay, we're going to do 25
45:50
years or maybe they're both, you know, really above average. We're going to do, you know, 37.8 years, right? Um, and
45:57
then each month when you update a plan or when we update the plan for you, if it's being tracked and monitored
46:03
automatically, we'll update the plan length. That's a huge huge thing. Um,
46:09
because as people live, if you survive, you know, five more years, your your life expectancy actually gets pushed out. Um, and and that's a that's an
46:17
important piece. Um, you can, and this is, you know, primarily this would be like if you had a, you know, a terminal
46:23
diagnosis or maybe you just want to be able to just state the end of the plan specifically. Um, you can, uh, you know,
46:31
just state a date when the plan ends for John or the plan ends for Mary. Um, so
46:37
that is, uh, that's how we do it. And and like I said, it's actually a it's
46:42
kind of a bigger uh a bigger deal than I think we uh we generally try to get credit for. Um because I'm not aware of
46:49
any uh any other software that that does that automatically for you.
46:55
Um let's see.
47:01
Somebody did ask is there a way to use external actuarial data to check against income labs
47:08
calculation? I don't know of any. I mean, they they actually say there is an actuaries longevity illustrator. I I
47:14
don't know what that is. Derek, do you have any insight into other actuarial or longevity calculators?
47:20
Not not that I could reference off the top of my head. I know I've seen some out there and I've used some different tools and definitely even talking with
47:26
clients about, you know, joint life expectancy versus single life expectancy are all real important conversations,
47:33
but um, you know, not not a great tool that that I'd have in my experience. I
47:38
do tend to find that most of my clients um either fall in the category of like probably feeling like they're going to
47:44
die way too soon or um you know really want to plan extremely far out. Um so I
47:50
just kind of match where they're at in terms of conversation and maybe try and nudge somebody along. But yeah, don't
47:56
don't have a good tool to reference off top. Yeah. The other I mentioned that we're
48:02
updating plan length all the time, which it doesn't make the initial plan length
48:07
irrelevant. It's still important how long you're planning for, but what is great is that you'll never catch up to
48:13
the original plan length because we're updating it. So, if you live 10 years,
48:19
you know, say you had a 30-year plan, if you live 10 years, that plan is not 20 years. It's probably 23 years or
48:25
something like that. So, it gets pushed out. So you'll never catch up to it, which actually goes a long way to
48:31
meaning you don't have to kind of guess right at the beginning. Um it it takes a lot of the the risk out of that. Um the
48:39
other thing that we do, which we've talked about before, is uh we do mortality adjustments to um things that
48:47
are sensitive to mortality. Um an obvious one is um social security. So um
48:54
here for example, we have two social securities. We have Mary and John. Um, and you'll see in this graph, which is,
49:01
you know, their whole plan all the way to 2056, you'll see social security in there, um, for both of them the entire
49:07
time. Because for this plan, we haven't set a specific date of death for either one of them. But that doesn't mean the
49:15
plan is assuming they will definitely both live to the end of the plan and that all of that social security will be
49:20
available for that whole plan. If we did that, we would probably be overstating the the resources that John and Mary
49:27
have and we'd be overstating how much they can spend. And this again is a really big deal. Um,
49:33
so, you know, if it's tempting and for good reasons to to plan for long lives
49:39
and so in other software you might have John and Mary, you know, both dying at 90 or 95.
49:44
I I understand where that comes from. The problem is that is then assuming that both social securities are there
49:50
into the 90s. Um, and that is actually not particularly likely. Probably the
49:55
smaller of the two will be gone and then the survivor will have the larger of the two. And so, Income Lab actually does
50:01
take that into account in the calculations of how much you can spend. We don't show it on this graph because this is for clients, right? Um, so you
50:08
just say, hey, you know, if if one of you didn't make it this whole time, you know, then you'd switch over to the
50:13
survivor benefit. Um, and that's taken into account. we just, you know, we're not going to show you a bunch of complex, you know, actuarial
50:20
calculations here. Um, but the way you could see that, for example, if I had, uh, you know, I do have a pension, I
50:27
think, in this plan. Um, and so I can see that here.
50:34
um and this one ends at Mary's death. But if I changed it to end at the second
50:40
spouse's death, um it would essentially become a joint life pension and then I would be able to spend more. And you
50:47
would see that like if I changed this, it it would actually give me a um a higher spending capacity or retirement
50:53
paycheck. So that's another really key piece of uh of income lab and the
50:58
longevity and mortality calculations. And Justin, one one just quick note on
51:03
that. I know coming from other software in particular where somebody always uses 95 or 100 or a set assumption, that can
51:10
be one thing that trips people up in like a meeting. So, um, do you want to show on the the other slider there too
51:15
where the where somebody would go to see the eight the life expectancy used in the plan?
51:21
Yeah, because that's couple places to do it. Um, one is just
51:26
if you hit show settings over here on the left, um, you can just scroll down and you'll see longevity setting and down here it
51:34
gives you a little, um, like what we're doing. Hey, we're planning for you to live longer than, you know, 60% of
51:40
people your age. So, it's conservative, right? It's saying you're above average in longevity. And for the two of you,
51:47
we're essentially giving you a 31-year plan. Um, so we're planning for one of you, at least one of you, to make it 31
51:54
years, which is, you know, pretty conservative.
51:59
Um, you also have access to the same thing in the advanced plan settings. There's a longevity section there.
52:07
All right. Um, have you seen any I don't know, Derrick, if you had a chance to look through the Q&A while we were talking there. Um,
52:14
any that jump out at you?
52:23
If not, I can hit another of our one that I was planning to hit, which was, is there any way to use income lab
52:31
to um evaluate pension options like lumpsum, joint survivor, all that kind
52:38
of stuff. So, um yeah, I actually did this recently um for my in-laws. Um so
52:44
the way that you would do that is um build different plans with those with
52:51
those different options. So for example, you know, this plan has a uh has that
52:57
pension. Um it was, you know, it was Mary's. Um so what I could do is maybe
53:04
there's a a different option that has the pension
53:10
as joint life. And you know, presumably it's probably a
53:15
little less. You know, let's say it's I I I'm going to make these numbers up. So it, you know, obviously the uh And so
53:23
now after John dies, it's still 900. After Mary dies, it's still 900. Um I'm going to say
53:31
joint life pension.
53:38
And so now the question will be, well, is it worth having it be joint life because the joint life payout is
53:44
probably smaller, right? I mean, maybe my discount was was too uh was too
53:50
large. Uh but we're now we're at 18,100 versus 18,300. So, okay, it looks like
53:58
if I do this, um I would my spending capacity would go down. Um that's
54:04
doesn't necessarily mean you would choose that, right? It depends kind of how afraid you are of an early death for
54:10
Mary in this case, right? Because this is based on sort of Mary having an
54:16
average uh mortality uh experience, but uh you know, nobody is 75% dead at any
54:24
point, right? You're either alive or you're dead. So, um you can look at this and just say, "Okay, well, the difference is $200 a month. um you know,
54:31
do we think that's worth it in order to buy some some longevity protection for for John in this case? And again, I made
54:38
the number up, so it could have gone the other way. It could have been that no, it's actually a good idea to uh to do joint. Um and then you would do the same
54:45
thing um for taking a lump sum. So, for example, I would I couldn't even guess
54:50
what this one the payout would be, but often, in fact, in pension documents, you'll often even see kind of their
54:57
assessment of how much value you're getting. Um, so I recently saw one that said, "Hey, you know, if you take a lump
55:03
sum, you're getting like 53% of the value." Um, and so, but you can put that in and and take take the pension out,
55:10
put that in as a new account or just add it to a um, you know, an IRA or something and um, and then see how the
55:17
retirement paycheck uh, is affected. Um, again, I would say the the number
55:22
differences are super important, but if they're relatively close, there is still this concept of like, well, you know, is
55:29
it worth it this way or the other in order if you want to give up, you know, uh, longevity protection or or
55:35
diversification of your income streams and and so on. Um, so I don't know, Derek, if you have thoughts on that.
55:43
Nothing I think I would add to that. All right, we have four more minutes.
55:48
Uh, looking at the Q&A, I did wonder if we should just kind of rapid fire go through some of these AI ones. There's
55:53
kind of a cluster of them there. All right, if that works. Do it. Let's do it. The first one I see, how trustworthy is
56:00
the AI on technical questions and does it provide citations? So, if you are using the AI assistant, like it it will
56:06
provide you some actual citations and documents you could go to to look at. Um, as with any AI, you know, you be
56:14
careful using it, but I would say that so far in my testing of it, it's it's done a pretty good job.
56:19
Yeah. Um, can it be can the AI be used to help you use income lab? I if you're stuck
56:25
with how to show something on your plan, um, again, AI assistant, I think, is where you'd want to go for that to kind
56:31
of ask general questions. How do I interpret this or how do I get that? Again, may not answer every question,
56:36
but that would be where I go. I don't know, Justin, would you add anything to that? Yeah, absolutely. I mean it it has been
56:41
designed to um you know just to cover the things that that we wanted to cover
56:47
but if you see things also that that are not covered please let us know. We actually the system is set up so that it
56:53
will notice if there are questions being asked that we don't cover. Um so it'll
56:58
we'll expand the coverage as time goes on to make sure um that's covered. Um I
57:03
did see Ashley was asking I mentioned you can track and monitor a plan automatically. Um that is right here. So
57:10
you the primary household plan can be tracked and monitored. All you have to do is click track and monitor. Um and
57:17
what happens then is every month at the beginning of the month we'll update that plan automatically. We'll bring in new
57:22
account balances. If you have integrations if you don't have integrations we'll use the target allocation to guess what the new
57:29
allocation is. We'll you know we get new data. We get new inflate we apply inflation. We make you one month older.
57:36
We you know everything. if the plan is entirely updated and then we uh instead of asking how much can I spend, we ask,
57:44
should I change what I'm spending? In other words, have I hit a guardrail? Is it time for an inflation adjustment? All that and then we let you know um in the
57:52
app uh whether that plan is calling for changes and what those changes are. So
57:59
yeah, probably something we uh we also there's so much in income lab, it's hard to cover everything all the time, but yeah, if you're relatively new to income
58:05
lab, that's a can be a surprising feature, but a good save a time save.
58:12
See a couple of questions in here about specific tools like Zox, Fireflies. Again, the tool is agnostic to where
58:18
you're what tool you're using. So if you can get a summary or a transcript from any AI tool, um that should work for
58:25
you. You could plug that in there. Somebody else asked about how to make it like the AI plan builder 100% accurate
58:31
and I would say that right now I would not treat it as a tool that is ever going to do that. I would always double
58:36
check go through the stepper and look in there. Um now the the way to try and get that as close to 100% accurate would be
58:43
to again make sure whatever medium you're using to you know get that in there uh you're covering all the key
58:50
inputs. But there are some things like savings goals and things like that that right now won't be captured at all. So
58:55
do do make sure you give it a look and verify what's in there. Yeah. For example, and it's going to
59:02
call out the ones that it doesn't uh cover in the same way that it will call
59:07
out things that are that it didn't find. Right. So here um it didn't find the end
59:13
date. Um so there we go. Um you'll see more and more our team is working hard
59:19
on this to cover more things. For example, state of residence will be covered very soon. um you know
59:24
retirement dates covered very soon. Um and so we'll just expand things over time. You won't you know you won't
59:31
necessarily see uh you know a big announcement about it but uh just as time goes on that will that tool will
59:37
get smarter. Um but yeah as Derek said you want to make sure you're you're you're monitoring these things. So
59:43
that's why we give you this chance to review it and then um you know it's
59:48
saying hey you're good with even though you haven't you know uh fixed all the or
59:54
not fixed but changed all the yellow stuff go ahead and create it and then it takes you right to life hub which is
1:00:00
also kind of a nudge toward hey have a look at this right um and and make sure
1:00:05
it's all it's all right. All right. Um,
1:00:12
sorry that I spent a lot of time on new new stuff today, but uh uh there there was a lot to go over. Um, I think there
1:00:20
is a link uh for um training meetings on this because this is a lot of new stuff. So, feel
1:00:26
free to reach out to our um customer success team if you have questions or just want to go over some examples on
1:00:33
any of this. Um they're they're there to help. Um, and I hope to see you all next
1:00:39
week at Retirement Income Intel where we'll dive deeper into um, these AI features and AI in general. So,
1:00:44
appreciate it. Have a good week, everybody.