Sign up to receive exclusive monthly wealthtech insights and interviews from our Chief Growth Officer, Jack Sharry. SIGN UP NOW

New Release: One small step for LifeYield, one giant leap for advisors

April 17, 2020 Steve Zuschin By Steve Zuschin

We’re proud to announce five new enhancements to the LifeYield platform!

  1. Social Security Income Layers
  2. Gain Limits and Implementation Cost
  3. Trade Export CSV
  4. Target Assignment
  5. Pro Rata Withdrawal

Here’s how these new features will benefit advisors.

New Feature: Income Layers for Social Security Advantage

Dynamically generated, easy-to-grasp charts that can be mapped to a client’s income needs and how much of that income is going to come from Social Security. There is lots of flexibility in calculating how much money the client will see if they retire at X or Y year. You can also add additional anticipated spending requirements, calculating for things like interest and inflation.

Why It Matters

One of the reasons why Social Security Advantage is so popular with LifeYield users (over 80K users) is that it helps advisors answer a key retirement question:

“When should we take social security?”

The new Income Layers feature now lets advisors address follow-up questions:

“How does this fit into my income needs?” and “What can we do about any potential shortfalls?”

New Feature: Gain Limits and Tax Cost of Implementing trades

Asset Location has always been a mystery to Advisors and their clients, often leaving them wondering the true value of these efforts. With Portfolio Advantage you can now run analysis that quantifies the value of this work and uses the Taxficient Score® to benchmark our progress. These new features empower the advisor and client to set a goal of realized gains when optimizing for asset location.

We can set the gain limit to zero for short term gains and $5,000 for long term gains, and LifeYield will show you how much improvement can be realized based on the Taxficient Score® and the long term value in dollars to the advisor and client.

Why It Matters

Previously LifeYield aimed to show the gross benefit of tax optimization using very limited data about the clients. With this new release, we utilize the detailed data provided by all our integration partners to power this analysis and give the advisor tools they need to enhance their value to clients and avoid unnecessary investment taxes. These newest features are accompanied by a new CSV export file with lot-level implementation guidance.

New Feature: Target Assignment for Portfolio Advantage

Investment models/SMAs have a challenge: for the most part, they’re not designed to work in tandem with other accounts as part of a single, coordinated household. And since they’re managed externally, the advisor has limited control over the models and their underlying securities. The extent of the advisor’s control is in deciding which model to assign to an account for the client.

Target Assignment works within these limits to make recommendations to allocate all of a client’s accounts as a “tax-smart household”, for optimal tax efficiency. Support for model strategies has been a highly requested feature from LifeYield users since the platform launched.

Target Assignment also allows Pro-Rata Withdrawal. Because of the nature of model strategies, advisors can’t always sell off individual securities if their clients need to draw down their savings. They’re constrained to withdraw a portion of the assets in the model, leaving the asset allocation in tact. Income Advantage will now use Pro-Rata Withdrawal to look at a client’s household and calculate which strategies to withdraw from – and how much – to meet the client’s spending needs and preserve optimal tax efficiency.

Why It Matters

As a highly requested feature, we’re committed to listening to customer feedback and incorporating it into our products. This enhancement is a prime example of what can happen when we can collaborate directly with advisors.

Additionally, this feature lets advisors exert a greater level of control over outsourced asset management for tax efficiency purposes. They can tailor the strategy to a client’s individual needs, letting them keep more of their money.

The Big Picture

These new features are designed to complement comprehensive  financial planning tools, creating a way to engage with a client and back into the conversation about the value of comprehensive planning. It lets the advisor respond to a client’s specific needs and start conversations about strategies and trade-offs they might need to make.

This is also a leap forward in making formerly complex and hard-to-grasp tax efficiency plays more accessible to the advisor and more tangible to the client.

Steve is the EVP of Advisor Success at LifeYield. He's responsible for leading our Direct-to-Advisor channel and always keeps up on the latest advisor technology. Steve writes about how advisors can grow their business by building stronger relationships with clients and adopting new technology.