Tolerisk has revolutionized risk tolerance assessments by providing advisors several easy tools that scientifically analyze different types of clients and prospects.
Tolerisk Pro allows advisors to customize the assessment for each client’s unique and dynamic cash-flow expectations. Advisors commonly include custom savings and spending patterns across multiple tax status as well as one-time inflows and outflows related to real estate, education, weddings, and inheritance. Tolerisk EZ provides a streamlined 5-minute process ideal for prospects. It is commonly embedded on the advisor’s website or posted to Social Media to begin a dialogue and qualify a prospect. Tolerisk 401k tackles the broad advisory challenge of how to better serve typical small-balance participants who don’t generate enough revenue to cover the costs of custom financial planning. Tolerisk 401k enables advisors to provide deep and meaningful customized advice to participants in a matter of minutes, making it practical to provide custom advice without raising fees. Advisors will win more plans, better serve participants, and generate more wealth management leads in the process.
Tolerisk advances general financial planning technology by incorporating 3 additional variables into its underlying mathematics.
With the advent of an objective measurement of a client’s Ability to take risk through time, Tolerisk incorporates an objectively dynamic (evolving) risk tolerance score, better reflecting the client’s likely risk level in the future. This creates a more realistic representation of investment returns and dispersions of returns. Separate historical scenarios for equities, fixed income, and inflation are incorporated to allow dynamic volatility and correlations between asset classes. This facilitates dynamic paths for real returns (potential portfolio returns relative to inflation through time) which is a better indicator of financial longevity than the traditional sequence of nominal return risk captured by most financial planning simulations. Tolerisk also incorporates 2nd to die mortality probabilities (customized by age, gender, health, habits, and heredity) to properly evaluate the client’s likelihood of outliving their money.
Tolerisk’s measurement of the client’s Probability of Running Out of Money is the deepest barometer currently found in financial planning technology.
Tolerisk incorporates 1000+ separate historical paths for equities, fixed income, and inflation, married with evolving asset allocation and 2nd to die annual survivorship probabilities. When the probability of outliving their funds is acceptable, both client and advisor can be confident their risk tolerance score was based on realistic assumptions. When the Probability of Running Out of Money is unacceptable, the advisor will advocate some combination of working longer, saving more until retirement, and downsizing some asset/expense in the future to reduce the probability of outliving their funds. Such financial planning changes can impact their Ability to take risk, necessitating both computations are produced concurrently.
Advisors using Tolerisk report that clients exhibit more confidence in their investment directive and their financial plan, driving up retention and referrals.
Prospects are impressed and more often become clients. Advisors please their compliance officer and regulators by demonstrating greater fiduciary care and a culture of compliance having incorporated cash-flows and mortality probabilities into their advice on risk directives.
Enterprise editions of Tolerisk can be implemented for larger organizations.
Enterprise editions are available through either custom User Interface or API integration into other institutional technology. From advisor driven processes to client-facing solutions, Tolerisk will improve the analytical efficacy of risk directive recommendation and selection as well as streamline the financial planning process.
