The tool was developed using product-allocation research, which blends three categories of income products—traditional investments, variable annuities and guaranteed income solutions—in optimal proportions to create lifetime retirement income.
The adviser enters information about the client’s age, current retirement savings and desired retirement income. The tool then generates a numerical measure called a Retirement Sustainability Quotient (RSQ). The higher this number, the more likely that the client’s current portfolio can generate the desired level of retirement income stream over his or her lifetime.
The tool offers up to three possible product-allocation strategies with higher RSQs. These higher RSQ strategies illustrate how the client might increase his or her likelihood of creating a more sustainable lifetime retirement income.
“It can be used as a stand alone educational tool or as a complement to more comprehensive retirement planning software that the adviser may already use,” said Christine Tucker, Pacific Life’s vice president of marketing, Retirement Solutions Division.
The tool’s analytical engine was built by the Quantitative Wealth Management Analytics Group (QWeMA) Group, which develops software algorithms in wealth management, investments and insurance.
For more support and training, Pacific Life is unveiling a suite of sales, education and promotional resources for its advisers— including an interactive website and tools, as well as printed materials—that focus on product allocation.
More about product allocation is available at www.PacificLife.com.