When providing advice to your clients, you will probably be faced with tasks that do not involve preparing a comprehensive financial plan.

For instance, you may be helping a client decide whether it would be more effective to pay down a mortgage vs contributing to an RRSP, or what is the most tax-efficient way to allocate RRSP contributions between spousal and non-spousal plans.

Answers to these and many other situational planning scenarios can be easily determined with the comprehensive suite of software planning tools offered by Edmonton-based Financial Plan Advantage Ltd.

Arguably, it may be necessary to have a complete picture of a client’s financial affairs prior to making a recommendation. Dave Faulkner, president of FP Advantage, says FP Advantage software is designed to complement, not replace, comprehensive planning software: “Each tool has a purpose and is designed to provide efficient and unbiased answers to specific situations.”

The 15 situational planning tools provided by FP Advantage fall into five broad categories: client as-sessment, financial planning, registered investments, non-registered investments and insurance needs.

A sixth category, practice management, is designed to help advisors analyse and build their businesses. This category includes extensive Practice Analyst software, PowerPoint presentations, articles, newsletters, template forms and letters.

The financial planning tools include a RRSP/RRIF planner, RRSP debt conversions, RRSP catch-up loans, RRSP vs mortgage, RRSP vs non-registered investments, estate maximization, RRSP income-splitting, a retirement planner, life insurance needs, estate tax funding, rate of return, an investment planner, leverage investing, leverage retirement and a return of capital withdrawal plan.

The RRSP/RRIF planner, for example, can illustrate the advantages of your recommendations to your client and provide answers to questions such as the effect of changes to asset allocation; minimum RRIF withdrawals, timing of withdrawals and annual vs monthly RRSP contributions. By entering your client’s current investment asset allocations, planned contributions, withdrawals and investment recommendations, you can get a side-by-side comparison that illustrates the benefits of the advice provided.

In addition, the tool allows you to calculate the required contributions based on income goals, or the income that can be withdrawn based on planned contributions.

The Estate Maximization tool determines the best way to structure RRSP investments to maximize both retirement income and estate values, while the RRSP vs non-RRSP tool helps clients understand the value of tax-assisted retirement savings compared with non-RRSP investments. When using the Estate Maximization tool, you can help your client determine which assets to spend first, how to implement tax sheltering for future growth and how to use life insurance to reduce taxes and increase estate value.

Each of the software programs is stand-alone and can store multiple client data, facilitating greater effectiveness and flexibility than a simple calculator. The tools also draw upon real information, eliminating the need for you to make assumptions, says Faulkner. For example, if a particular situation requires the use of a tax rate, you don’t have to input an assumed rate; the software will apply the real tax rate based on the specific client circumstances.

The Web-based FP Advantage tools are free to financial advisors. All updates, program support and help files are provided online. The software and client data files are installed on your computer, providing access even when no Internet connection is available. All the tools use a single authorization key, which you are prompted to download weekly from the FP Advantage site. You must install Microsoft Excel to run the software tools.

FP Advantage is able to offer its software tools free to advisors through sponsored Web site content. Faulkner says advisors may also use his firm to prepare comprehensive financial plans, a revenue generator for his company.

FP Advantage’s Practice Analyst tools, designed specifically for advisors, provides a year-by-year analysis and forecasts of your assets under administration, income and expenses. The software also helps make decisions in areas such as profit maximization and product introduction. IE