Allocation Path - RightCapital Help Center

The Allocation Path tab of RightCapital's Investment module allows you to easily illustrate to a client how their investment strategy will change over time. You can access this module within the Investment > Allocation Path tab of each client plan:

While the Asset Allocation section breaks down a client's investment strategy as of today, the allocation path visualizes their investment strategy out into the future. This can be a valuable tool in demonstrating to clients how their overall investment allocation might shift alongside their changing financial goals as they age.

The allocation path graph will use the first client's age on the x-axis, and the percentage of investments held in equity, fixed income, and cash on the y-axis. The "first" client refers to the individual entered within the Client card in the Family Profile. You can hover your mouse over the graph to view specific percentages for each year of the plan.

Adjusting the Allocation Path

A client's allocation path can be adjusted via the 'Allocation Method' plan setting. You can access this setting within the Gear Icon > Settings > Methodology tab:

This setting determined how a client's allocation will be projected out into the future within the financial plan. There are four options to choose from here:

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.
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.

Choosing a different allocation method will result in a change to the client's allocation path. For example, compare the 'glide path' screenshot above to the screenshot below, using the 'pre- and post- retirement allocation' option:

Changing your allocation method will also adjust the dropdown menus that appear to the upper right of the chart. You can use these to better visualize the impact of different starting allocations / glide paths on a client's allocation path.

Changes made using the dropdown menus in the Allocation Path tab are for demonstrative purposes only, and will not impact the Retirement Analysis planning module. Only the Allocation Method setting will impact a client's Monte-Carlo analysis and cash flow projections.