Client Presets - RightCapital Help Center

Adjust System-Wide Client Presets

RightCapital exists for financial planning done just right, and is perfectly tuned for tailor-made advising. The first step in breaking out of the box and letting your unique approach to advising shine is to customize the global settings applied to new clients you create or import from a 3rd-party CRM integration.

This can be done within the Client Settings > Client Presets tab of the Advisor Portal. Depending on your specific account setup, your Client Settings tab may be located in the °°° More Menu.

This page is divided into four sections: Methodology, Plan parameters, Taxes, and Other presets. Any changes made within these areas will be applied to new clients created in RightCapital going forward. Existing clients will not be impacted.

Looking for a specific setting?

Use the table of contents on the right side of this page to skip to a specific methodology setting, plan parameter, or other preset.

Methodology

The Methodology section allows you to set the default settings presets that will be used within newly created client plans. The settings listed on this page are identical to those within the Gear Icon > Settings > Methodology tab of each client plan.

Client presets is used to change your system-wide settings presets for new clients. For more on changing settings for existing clients, please see our article on Individual Client Methodology.

Planning method

The planning method indicates how RightCapital handles surplus/shortage of cash flow in any given year. The default setting is Modified cash flow based.

Cash flow based will automatically save and reinvest any cash flow surplus into the client's taxable investments.
Modified cash flow based will automatically spend off any cash flow surplus. This option allows you to use taxable savings cards.
Goal based ignores income and expenses and instead looks only to goals, savings, and account information.

To learn more about planning methods and their impact on a client plan, read our article on understanding planning methods , as well as our article on cash flows.

Cash flow in simulation starts

This setting determines your cash flow start date. The default setting is Jan 1st of this year.

Jan 1st of this year will start your cash flow projections at the beginning of the current calendar year.
Jan 1st of next year will start your cash flow projections at the beginning of the next calendar year.
Current month (rolling 12 months) will start your cash flow projections on the 1st of the following month.

To learn more about timing options and their impact on a client plan, read our article on timing options, as well as our article on cash flows.

Withdrawal sequence

This setting reflects the order in which accounts will be drawn from when funding cash flow needs. The default setting for the withdrawal sequence is Taxable, tax-deferred, tax-free.

There are five different withdrawal sequence options to choose from:

Pro-rata
Taxable, tax-deferred, tax-free
Taxable, tax-free, tax-deferred
Taxable, pro-rata
Tax-deferred, taxable, tax-free

Planned distribution method

This setting determines how required minimum distributions and manually added income distributions will interact with each other. The default setting is RMD added to manual distribution.

RMD added to manual distribution will combine income distributions with the calculated RMD amount in years where both occur (the sum of RMD and other distributions).
Greater of RMD and manual distribution will choose the higher of income distributions and calculated RMD amounts in years where both occur (whichever is greater).
No RMD, manual distribution only prevents RightCapital from automatically calculating RMDs. Only manual distributions will be reflected.

To learn more about RMDs and income distributions, read our articles on required minimum distributions and manually added income distributions.

Allocation method

The allocation method setting determines how a client's investment allocation will be projected out into the future. The default setting is Same asset allocation for all years.

Same asset allocation for all years will use the client's Current allocation as the long-term rate of return within the plan. The Current Allocation is the blended result of all of the client's non-annuity invested assets (entered in Profile > Net Worth), and can be viewed within the Investment > Asset Allocation tab.
Pre- and post- retirement allocation will use the client's Current allocation in pre-retirement, and will allow you to specify a different model portfolio to be used in post-retirement. New asset allocation models can be created within the Models > Portfolios tab of the advisor portal.
Enable glide path will model a gradual transition in a client's investment allocation over time. New glide paths can be created within the Models > Glide tab of the advisor portal. The grading schedule determines how quickly the client's current allocation will transition to match the allocation of your chosen glide path
No blending across account types will use the individual rate of return associated with each investment type (e.g. taxable account, IRA, etc.) rather than the Current Allocation when calculating portfolio return. In other words, all investment types will grow based on their own separate rates of return.

Please note that when using No blending across account types, you will be unable to:

Apply a glide path or use pre- and post-retirement allocations
Propose an alternate asset allocation within the Retirement Analysis
Propose an Asset Location Strategy in the Tax Strategies module

Cash management method

The Cash management method setting determines how bank accounts will be treated within the plan. The default setting is Treat bank account as cash; spend cash before taxable.

Treat bank account as cash; spend cash before taxable will cause bank accounts within the plan to be used as the Cash Reserve portion of a client's taxable bucket. This option will spend the cash reserve first, before tapping into taxable assets in the case of negative net flows.
Treat bank account as cash; spend cash after taxable will cause bank accounts within the plan to be used as the Cash Reserve portion of a client's taxable bucket. This option will liquidate taxable assets first, before tapping into cash reserve in the case of negative net flows.
Use cash reserve goal to manage cash levels will enable a Cash Reserve Goal card within the Profile > Goals section, which you can use to precisely specify the dollar amount kept in the client's cash reserve over time.

To learn more about the cash management options and their impact on a client plan, read our articles on Cash Management.

Distribute investment income from taxable account

This setting will automatically distribute interest and dividends from taxable accounts as income within a client's plan. The default setting is Never.

Never will turn off automatic distribution of investment income within the plan. Interest and dividends will be factored into the client's portfolio return.
Every year will automatically distribute investment income starting right away within the plan.
After retirement will automatically distribute investment income starting in retirement within the plan.

How are interest and dividends calculated?

Rightcapital calculates interest and dividends by looking at the asset class breakdown of the client's portfolio, in tandem with your advisor-specific return assumptions.

Health Savings Account distributions

This setting determines when the system will start using Health Savings Account (HSA) assets to fund medical expenses. The default setting is Start to fund medical expenses immediately.

Start to fund medical expenses immediately: HSA assets will be distributed as soon as medical expenses begin to occur within the plan.
Start to fund medical expenses at first retirement: HSA assets will accumulate untouched until the year of first retirement. After that point, HSA assets will be distributed as soon as medical expenses begin to occur within the plan.
Start to fund medical expenses at second retirement: HSA assets will accumulate untouched until both clients retire. After that point, HSA assets will be distributed as soon as medical expenses begin to occur within the plan.

Additional options for this setting are available at the client level, allowing you to choose a specific client's age or a specific calendar year.

Retirement expense timing

This setting indicates when the switch will happen from pre-retirement living expenses (entered in Profile > Expenses) to retirement living expenses (entered in Profile > Goals) within joint plans. The default setting is Start retirement expense goal at first retirement.

Start retirement expense goal at first retirement will cause the retirement expenses to kick in when the first client retires.
Start retirement expense goal at second retirement will cause the retirement expenses to kick in when the second client retires.

Include bank accounts in Asset Allocation chart

This setting can be used to include a client's bank accounts in the Current Allocation pie chart in the Investment > Asset Allocation tab. This is purely a visual change, and will not impact investment returns within the retirement projections. By default, this setting is unchecked.

Allow display of scenario-specific cash flows

This setting can be used to enable return scenarios within the Retirement > Cash Flows tab. New return scenarios can be created within the Models > Scenarios tab of the advisor portal. By default, this setting is unchecked.

Why use return scenarios in the cash flows?

By default, the cash flows use the Baseline scenario. This is a straight-line, linear growth projection using your advisor-specific return assumptions. By enabling return scenarios, you can inject some volatility into a client's cash flow tables by implementing specific sequences of returns.

Take annuity RMD from IRA account first

This setting, if checked, allows you to delay taking withdrawals from qualified annuities with a lifetime income guarantee (set up with a distribution type of 'Lifetime Income') by satisfying the annuity's Required Minimum Distributions (RMD) from the client's traditional IRA accounts or other qualified annuities. This allows clients to delay withdrawals on the lifetime income annuity in order to provide a higher guaranteed income amount in future cash flows.

If the setting is unchecked, we will calculate the RMD for lifetime income annuities each year starting in the year the client hits RMD age, and will distribute the greater of the RMD or the client's lifetime income amount in that year. By default, this setting will be unchecked.

Only use this setting if your client has sufficient funds in their IRAs or other qualified annuities to cover the additional RMDs. If there are insufficient funds, the client's RMDs will be understated.

Whether the setting is checked or not, once lifetime income withdrawals begin, those withdrawals will count towards the total RMD required across your clients' IRA and qualified annuity accounts. If the lifetime income amount exceeds the RMD calculated for the lifetime annuity, we will reduce the RMD from the client's traditional IRA by the excess amount.

Use taxable account to fund IRA and 529 saving when current year cash flow is inadequate

This setting can be utilized to fund IRA and 529 savings by automatically liquidating taxable assets in years when clients do not have sufficient cash flows. By default, this setting is checked.

When this setting is checked, RightCapital will first fund IRA, Roth IRA, and 529 contributions using available cash flows. If there are insufficient cash flows in any year, RightCapital will then look to fund those contributions using taxable assets. This will automatically calculate a withdrawal (and taxes) from the client's taxable investments to maintain these savings goals. If there is no available money in taxable accounts, RightCapital will not reflect the contributions in those years.

If unchecked, RightCapital will only reflect IRA, Roth IRA, and 529 savings in years where clients have the available cash flows. If there are insufficient cash flows in any year, contributions will not occur.

Use 529 accounts to fund Pre-College Education goals

This setting allows you to specify if 529 accounts will be used to fund Pre-College Education goals. By default, this setting is checked.

When checked, up to $10,000 of 529 funds will be used to fund the pre-college education goals. If unchecked, 529 accounts will not be used as a funding source and will be reserved exclusively for college goals.

Include taxable saving in Planned Saving column (Modified Cash Flow only)

This setting can be used to move taxable savings from the Net Flows column, to the Planned Savings column of the Retirement > Cash Flows > Summary page. This is a purely visual change, and will only appear as a setting when using Modified cash flow based as your Planning method. By default, this setting is unchecked.

Spend unsaved RMD/distributions (Modified Cash Flow only)

This setting determines whether or not cash flow surplus from RMDs and income distributions will be automatically saved or spent off. This setting will only appear when using Modified cash flow based is your Planning method. By default, this setting is checked.

When checked, RMDs or manual distributions that are not used to fund cash flows (or are not explicitly saved) will be spent off. Spent RMDs can be seen in the “Spend unsaved cash flow” column of the Retirement > Cash Flows > Summary page.

If unchecked, RMDs or manual distributions that are not used to fund cash flows will automatically be saved and reinvested into the taxable bucket of assets. Saved RMDs can be seen in the “Net Flows” column of the Retirement > Cash Flows > Summary page.

Plan parameters

The Plan parameters section allows you to set a number of default plan inputs that will be used within newly created client plans. Most of these parameters are a part of the initial data entry process (the Profile) and are primarily intended to save you time when inputting client information into RightCapital.

Planning horizon

This controls the default planning horizon for new clients, which is the age at which a client is assumed to pass away. This parameter stems from the Client and Co-client cards within the Profile > Family section of each plan. By default, this will be set to age 90.

Residence state

This controls the default resident state for new clients, which determines how state taxes will be calculated in the retirement projections. This parameter stems from the Client card within the Profile > Family section of each plan. By default, this will be set to New York.

Retirement age

This controls the default retirement age for new clients. This parameter stems from the Retirement Age card within the Profile > Goals section of each plan. By default, this will be set to 67.

Annual retirement health cost estimate

This controls the default retirement healthcare costs for new clients. This parameter stems from the Annual Retirement Health Cost card within the Profile > Goals section of each plan. By default, this will be set to the National average ($6,092 for 2024).

Annual retirement LTC duration

This controls the default long-term care duration for new clients. This parameter stems from the Annual Retirement LTC Cost card within the Profile > Goals section of each plan. By default, it is set to the Last two years of the plan.

Annual retirement LTC cost estimate

This controls the default long-term care costs for new clients. This parameter stems from the Annual Retirement LTC Cost card within the Profile > Goals section of each plan. By default, it will be set to In-home care — national average ($68,640 for 2024).

Spending strategy

This controls the default retirement spending strategy for new clients, which determines how their retirement expenses will change over the course of their plan. This parameter stems from the Retirement Expense card within the Profile > Goals section of each plan. By default, this will be set to Inflation Adjusted.

To read more about retirement spending strategies, click here.

Expense Approach

This controls the default expense approach for new clients, which determines whether living expenses are entered as a single monthly amount, or as a detailed worksheet with custom expense categories. This parameter stems from the "Pre-retirement Living Expenses" and "Retirement Expense" cards, within the Profile > Expenses and Profile > Goals tabs respectively. By default, this will be set to Simple approach.

Historical Net Worth Period

This controls the default time period for the Historical Net Worth chart, located within the Dashboard > Balance Sheet area of each plan. The default setting is Last 12 months.

Target allocation

This controls the default target allocation for new clients, which is the model portfolio that can be compared to the client's current allocation in the Investment > Asset Allocation tab of each plan. New asset allocation models can be created within the Models > Portfolios tab of the advisor portal.

Taxes

The Taxes section provides four tax-related settings that can be adjusted at a global level for new clients. Most of these settings live within the Gear Icon > Settings > Tax Assumptions tab of each client plan.

Average AUM fees

This controls the default Average AUM fees for new clients, which will reduce all non-annuity invested asset returns by the indicated percentage. The default setting is 0%. Within a client plan, this parameters can be adjusted within the Profile > Expenses > Tax and Fees card.

Portfolio turnover

This controls the default Portfolio turnover for new clients, which represents annual portfolio balancing and will generate capital gains within your plans. This parameter stems from the Gear Icon > Settings > Tax Assumptions tab of each plan. By default, this will be set to 5%

Qualified dividend

This controls the default assumption for qualified dividends for new clients, which represents the percentage of dividends that are assumed to be tax-qualified. This parameter stems from the Gear Icon > Settings > Tax Assumptions tab of each plan. By default, this will be set to 85%.

Long term capital gain

This controls the default assumption for long-term capital gains for new clients, which represents the percentage of capital gains that are assumed to be long-term. This parameter stems from the Gear Icon > Settings > Tax Assumptions tab of each plan. By default, it will be set to 90%.

Other presets

The Other presets section provides three additional settings that can be adjusted at a global level for new clients.

Client action item permission

This setting determines whether or not invited clients can make changes using the Action Items. This primarily impacts the Retirement > Analysis section, where proposals and what-if scenarios are modeled. This is a Client Portal Setting, which stems from the Client Access tab of the Clients area. The default selection is Client can try different action items, but the changes will not be saved.

Client profile item permission

This setting determines whether or not invited clients can update information within the Profile tab of the client portal. This is where data entry is done for the client's Current plan. This is a Client Portal Setting, which stems from the Client Access tab of the Clients area. The default selection is Client can update profile information.

Discount rate used for optimization

This controls the default discount rate for new clients, which impacts the Social Security Optimization Tool. Setting a discount rate will reduce future Social Security benefits within the Retirement > Social Security tab by the percentage indicated, and is an important factor in accounting for the time value of money when running an analysis on estimated future benefit amounts. This setting stems from the Gear Icon > Settings > Other Assumptions tab of each plan. By default, this will be set to No discount.