Income Lab debuts retirement stress testing tool

Financial Planners

Income Lab, a Denver-based retirement management software provider, debuted a retirement stress testing tool on Tuesday.

The new service aims to show financial advisors how clients can use spending adjustments to navigate challenges such as market volatility and high inflation, the company said.

The tool includes options to execute plans through real-life historical scenarios such as the Great Depression of the 1930s, the post-war period, the stagflation of the 1970s, the dot-com bubble of the 1990s, and the financial crisis of 2008.

Advisors can not only show you how income adjustments can help keep your plans on track amid these headwinds, but they can also compare different strategies simultaneously.

Chief Innovation Officer Justin Fitzpatrick and CEO Johnny Paulsen co-founded Income Lab in 2018. In early 2020, the company introduced a beta version of its cloud-based software for the financial advisory and planning market.

In September 2021, Income Lab closed a seed funding round, raising $1.7 million from industry executives and investors. Investors included Dave Agostin, former managing director of BlackRock and former CEO of Kashmatrix. Tom Florence is the managing director of Hamilton Lane and former CEO of 361 Capital. His CFO at Conga and he’s a board member of Income Lab is Robert Pinkerton. Agostin and Florence serve on the Income Lab’s advisory board, along with Derek Tarp, a financial planner at Conscious Capital, principal investigator at financial blog, and assistant professor of finance at the University of Southern Maine.

In June 2022, Income Lab introduced Life Hub, an interactive tool for financial advisors that gives clients a one-page, in-depth visualization of their financial lives, at any level of detail, at any time. Life Hub is included as part of Income Lab, retirement planning software available to advisors, according to the company, with prices starting at $159 per month per advisor and up to $139 per month for large teams of advisors. It has become.

Income Lab is one of several providers tackling retirement income issues. IncomeConductor is most used by planners and registered investment advisors, while IncomeDiscovery seeks larger players, including financial institutions and independent brokers/dealers. Another of his Income Solver is a Decumation Strategy overlay application.

Investor longevity and volatile market conditions make retirement income planning “more important than ever,” said William Trout, director of wealth management at Javelin Strategy & Research.

“Tools like Income Lab’s Retirement Stress Test Tool help advisers guide their clients through a time of economic upheaval and articulate the importance of staying behind the wheel,” Trout said. said. “At the same time, providing a forward-looking perspective can instill confidence in customers and help them connect their spending habits to results. You may be the first to be persuaded.”

Wally Okvey, Wealth Management Strategy Advisor at Aite Novarika Group, said there are “good reasons” that multiple vendors are already offering sophisticated personal financial management and financial wellness tools to the wealth community. ‘ said there is. Several analyzes the company recently completed showed that “holistic practices create healthier and more sticky relationships with customers,” Okby said. These results show that 50% to 60% of his smaller asset managers with less than $1 billion in assets under management provide cash flow management to their clients.

“The most comprehensive financial advisors tend to generate more new client relationships, total client assets, fee-based assets, client wallet share and revenue than those who do not. Vendor Community We are now clearly ready to take advantage of this demand for comprehensive planning,” said Okby. “The smaller the clinic, the less likely it is that this service will be offered. , I imagine the Income Labs team will try to scale the business quickly by signing up a number of smaller offices.”

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