Portfolio integration module for providing financial planning and advice

• US 8,498,913 B2
• Filed: 05/03/2004
• Issued: 07/30/2013
• Est. Priority Date: 07/31/2001
• Status: Active Grant

• Current Assignee: Ameriprise Financial, Inc.
• Original Assignee: Ameriprise Financial, Inc.
• Inventors: Jenson, Jodi, Scarlato, Patricia, Vanney, Beth M.
• Primary Examiner(s): FELTEN, DANIEL S
• Application Number:
  US10/837,849
• Publication Number:
  US 20040267651A1
• Time in Patent Office: 3,375 Days
• Field of Search: 705/36, 705/35, 705/36.R
• US Class Current: 705/35
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

The present invention provides systems and methods for facilitating financial advising and planning for a user. The system includes a portfolio integration module that integrates goals, assets, savings, and risk tolerance to develop a customized strategy for financial portfolio planning. A portfolio reconciler module facilitates comparison of the customized strategy to other strategies and projected user financial decisions in order to further facilitate the financial portfolio planning. A stochastic modeling module uses data from the portfolio integration module and the portfolio reconciler module in a stochastic modeling analysis using a synchronous stationary bootstrap sampling method to construct a proposed situation portfolio. A simulator module forecasts the effects of the proposed situation portfolio on the user'"'"'s portfolio, and monitoring, simulating, designing, and testing the portfolio integration module, the portfolio reconciler module, and the stochastic modeling module.

Claims

1. A portfolio integration software module for facilitating financial advising and planning, the portfolio integration module configured to:

facilitate, by a computer for facilitating financial advising and planning and comprising the portfolio integration software module, integration of goals, assets, savings, planned hypothetical events, unplanned hypothetical events, transactions, and a risk tolerance of a client;

communicate, by the computer, with a portfolio reconciler module, a stochastic modeling module, a simulation module and an advice utility server, wherein the advice utility server is configured to create a financial advice application including data from a plurality of financial services;

wherein the portfolio reconciler module is configured to facilitate comparison of a customized strategy to at least one of other strategies or projected client financial decisions in order to further facilitate the financial portfolio planning for the client;

wherein the stochastic modeling module is configured to facilitate use of data from the at least one of;

the portfolio integration software module or the portfolio reconciler module in a stochastic modeling analysis to facilitate creation of a proposed situation portfolio, wherein the analysis includes stochastic simulation of both planned hypothetical events and unplanned hypothetical events, wherein the unplanned hypothetical events comprise at least one of a disability, a retirement date, a death or a divorce;

wherein the simulator module is configured to simulate, monitor and test at least one of the advice utility server, the portfolio integration software module or the portfolio reconciler module;

obtain, by the computer, the risk tolerance, a goal timing schedule, the goals value, an assets value, a regular assets value, and contributions value;

determine, by the computer, a plurality of proposed portfolios based upon the risk tolerance, the goal timing schedule, the goals value and an allocation table, wherein the allocation table comprises a plurality of cash, equity and fixed percentages for each portfolio in the plurality of portfolios, and for each of a plurality of time segments, the time segments comprise i) 0 to 3 Years from non-retirement goal, ii) 4 to 7 Years from non-retirement goal, iii) 8 to 15 Years from non retirement goal, iv) 16 or more Years from non-retirement and greater than 3 years away from retirement, v) 2 years or less from retirement, and wherein the goal timing schedule is based at least partially upon the plurality of time segments;

determine, by the computer, a short-term timeframe based upon the goal timing schedule;

determine, by the computer, a long-term timeframe based upon the goal timing schedule and a retirement date of the client;

determine, by the computer, a short-term goals value based upon the goals value, the goal timing schedule and the short-term timeframe;

determine, by the computer, a long term goals value based upon the goals value, the goal timing schedule and the long-term timeframe;

determine, by the computer, a short-term regular assets portfolio based upon the short-term timeframe and the risk tolerance of the client;

determine, by the computer, a long-term regular assets portfolio based upon the long-term timeframe and the risk tolerance;

determine, by the computer, a short term portfolio regular assets amount;

determine, by the computer, a proposed regular assets portfolio based upon the short-term regular assets portfolio and the long-term regular assets portfolio;

determine, by the computer, a short-term regular contributions portfolio based upon the short-term timeframe and the risk tolerance;

determine, by the computer, a long-term regular contributions portfolio based upon the long-term timeframe and the risk tolerance;

determine, by the computer, a short-term regular contributions amount;

determine a proposed regular contributions portfolio;

determine, by the computer, a short-term variable universal life (VUL) goals portfolio based upon the short-term timeframe and the risk tolerance;

determine, by the computer, a long-term VUL goals portfolio based upon the long-term timeframe and the risk tolerance;

determine, by the computer, an amount of VUL cash values and premiums that should be invested in the VUL goals short-term portfolios and the VUL goals long-term portfolios;

determine, by the computer, a proposed VUL goal funding portfolio based upon the short-term VUL goals portfolio and the long-term VUL goals portfolio;

determine, by the computer, a retirement proposed portfolio based upon long-term timeframe and the risk tolerance;

determine, by the computer, a proposed VUL non-goal funding portfolio based upon long-term timeframe and the risk tolerance; and

update, by the computer, the plurality of proposed portfolios in response to receiving a change in at least one of the risk tolerance, the goal timing schedule, the goals value, a proposed contribution amount, or a mixture of regular versus retirement assets.

2. The portfolio integration module of claim 1, wherein the creation of the proposed situation portfolio considers portfolio of the assets in order to balance short-term risks in a market with long-term return potential.

3. The portfolio integration module of claim 2, further configured to calculate at least one of:

the taxable assets, the tax-deferred assets, or the VUL insurance cash values to be invested in at least one of;

a short-term assets portfolio or a long term asset portfolio.

4. The portfolio integration module of claim 3, further configured to calculate at least one of:

taxable savings, tax-deferred savings, or cash value insurance premiums to be invested in at least one of a short-term savings portfolio or a long-term savings portfolio.

5. The portfolio integration module of claim 4, wherein creation of the proposed situation portfolio includes analysis of a normal life span, disability, long-term care, early death, life insurance information, disability insurance information, Social Security, social pension, asset structure, savings, goals, retirement information, expenses, tax structure of assets, savings, company pension information, and educational goals affecting a financial or personal situation of the client.

6. The portfolio integration module of claim 5, wherein creation of the proposed situation portfolio further includes at least one of:

customized timelines for at least one of;

normal life span, disability, long-term care, early death, life insurance information, disability insurance information, Social Security, social pension, asset structure, savings, goals, retirement information, expenses, tax structure of assets, savings, company pension information, or educational goals affecting a financial or personal situation of the client;

customized timelines for each member of a family; and

analysis of life expectancy on factors other than retirement information.

7. The portfolio integration module of claim 6, further comprising at least one of:

a portfolio reconciler module, a stochastic modeling module, or a simulator module in communication with the portfolio integration module in order to further facilitate the financial portfolio planning of the client and creation of the proposed situation portfolio for the client.

9. The portfolio integration module of claim 1, further configured to include a goals and assumptions identifier, wherein the goals and assumptions identifier is configured to:

input and associate a group goal and a group assumption with economic group data and, wherein the portfolio integration module simulates a group passage of time, to analyze an economic group'"'"'s available financial resources with respect to fulfilling the group goal based upon the group assumption; and

process a financial position for an economic group based upon an analysis of the available financial resources and in response to at least one hypothetical event or transaction and, wherein the portfolio integration module obtains demographic data and financial data pertaining to the economic group and, wherein the portfolio integration module analyzes and solves the group goal in an efficient order, accounting for any dependency of future goals upon prior goals, based upon the group assumption, the demographic data, and the financial data.

10. The portfolio integration module of claim 9, further configured to:

identify historical test data to apply to a simulation, wherein the test data includes at least one of;

user input, market projections, economic projections, historical portfolio data, or cash flow from a plurality of scenarios;

retrieve the historical test data;

select a test scenario, wherein the test scenario includes a test goal;

simulate a portfolio integration module, a portfolio reconciler module, and a stochastic modeling module using the historical test data and test scenario;

assemble simulation results from the simulation;

compare the simulation results to actual results produced by the portfolio integration module, the portfolio reconciler module, and the stochastic, modeling module; and

,

in response to the simulation results not matching the actual results, modify at least one of;

the portfolio integration module, the portfolio reconciler module, or the stochastic modeling module.

11. The portfolio integration module of claim 10, wherein the planned hypothetical events include at least one of:

an expected lifespan of the client or an average lifespan of a family member associated with the client, wherein the expected lifespan is based on health of the client and family history, and wherein the average lifespan is based on health of the client and family history.

12. The portfolio integration module of claim 11, wherein each of the goals are weighted based on at least one of:

client preference for importance of a respective one of the goals, importance of a timeframe for achieving the respective one of the goals, or a timeframe for achieving the respective one of the goals.

13. The portfolio integration module of claim 12, wherein the advice utility server is further configured to:

receive user input relating to goals of the client;

communicate with the portfolio reconciler module and the stochastic modeling module;

receive, from a plurality of disparate providers, a plurality of distinct financial advice service modules based upon the user input, wherein each of the plurality of distinct financial advice service modules comprises executable code;

add the new financial advice service module as a new resource to the advice utility server, wherein the new financial advice service module is independently developed;

analyze the new financial advice service module to determine data requirements;

compile data requirements unique to the new financial advice service module, wherein the data requirements include data field formatting and properties data values; and

dynamically compile a revised data entry page having fields for collecting the information based on the data requirements, wherein the fields are populated by at least one of;

the client or a representative of the client via a user computer, to create fields populated with the information.

14. The portfolio integration module of claim 13, further configured to receive the information from the revised data entry page and facilitate integration of the information, the portfolio integration module for analyzing and developing a customized strategy for financial portfolio planning of the client, wherein the customized strategy is determined by simulating a passage of time to analyze the assets of the client with respect to fulfilling the goals based on an assumption, and processing a financial position for the client based on an analysis of the assets and in response to the planned hypothetical events, the unplanned hypothetical events, and the transactions.

8. A non-transitory, tangible computer-readable medium having computer-executable instructions stored thereon that, if executed by a computer, cause the computer to perform operations comprising:

facilitating integration of goals, assets, savings, planned hypothetical events, unplanned hypothetical events, transactions, and risk tolerance of a client;

communicating with a portfolio reconciler module, a stochastic modeling module, a simulation module and an advice utility server, wherein the advice utility server is configured to create a financial advice application including data from a plurality of financial services wherein the stochastic modeling module is configured to facilitate use of data from the at least one of;

the portfolio integration module or the portfolio reconciler module in a stochastic modeling analysis to facilitate creation of a proposed situation portfolio, wherein the analysis includes stochastic simulation of both the planned hypothetical events and the unplanned hypothetical events, wherein the unplanned hypothetical events comprise at least one of a disability, a retirement date, a death or a divorce;

obtaining the risk tolerance, a goal timing schedule, the goals value, an assets value, a regular assets value, and contributions value;

determining a plurality of proposed portfolios based upon the risk tolerance, a goal timing schedule, a goals value and an allocation table, wherein the allocation table comprises a plurality of cash, equity and fixed percentages for each portfolio in the plurality of portfolios and for each of a plurality of time segments, the time segments comprising i) 0 to 3 Years from non-retirement goal, ii) 4 to 7 Years from non-retirement goal, iii) 8 to 15 Years from non-retirement goal, iv) 16 or more Years from non-retirement and greater than 3 years away from retirement, v) 2 years or less from retirement, and wherein the goal timing schedule is based at least partially upon the plurality of time segments;

determining a short-term timeframe based upon the goal timing schedule;

determining a long-term timeframe based upon the goal timing schedule and a retirement date of the client;

determining a short-term goals value based upon the goals value, the goal timing schedule and the short-term timeframe;

determining a long-term goals value based upon the goals value, the goal timing schedule and the long-term timeframe;

determining a short-term regular assets portfolio based upon the short-term timeframe and the risk tolerance;

determining a long-term regular assets portfolio based upon the long-term timeframe and the risk tolerance;

determining a short term portfolio regular assets amount;

determining a proposed regular assets portfolio based upon the short-term regular assets portfolio and the long-term regular assets portfolio;

determining a short-term regular contributions portfolio based upon the short-term timeframe and the risk tolerance;

determining a long-term regular contributions portfolio based upon the long-term timeframe and the risk tolerance;

determining a short-term regular contributions amount;

determining a proposed regular contributions portfolio;

determining a short-term variable universal life (VUL) goals portfolio based upon the short-term timeframe and the risk tolerance;

determining a long-term VUL goals portfolio based upon the long-term timeframe and the risk tolerance;

determining an amount of VUL cash values and premiums that should be invested in the VUL goals short-term portfolios and the VUL goals long-term portfolios;

determining a proposed VUL goal funding portfolio based upon the short-term VUL goals portfolio and the long-term VUL goals portfolio;

determining a retirement proposed portfolio based upon long-term timeframe and the risk tolerance;

determining a proposed VUL non-goal funding portfolio based upon long-term timeframe and the risk tolerance; and

dynamically updating the plurality of proposed portfolios in response to receiving a change in at least one of the risk tolerance, the goal timing schedule, the goals value, a proposed contribution amount, or a mixture of regular versus retirement assets.