/financial-planning-workflow

name: financial-planning-workflow
description: "Orchestrate the advisor workflow for assembling and delivering a comprehensive financial plan — data gathering, cash flow analysis, retirement modeling, Monte Carlo analysis, Roth conversion and withdrawal sequencing, Social Security claiming strategy, education and estate goals, scenario modeling, and prioritized recommendations. Use when the user asks about building a financial plan, structuring a planning engagement, retirement or Social Security modeling, Roth conversion strategy, scenario analysis, prioritizing competing recommendations, preparing a plan presentation, or deciding when a plan needs updating. Also trigger on 'comprehensive financial plan', 'discovery meeting', 'retirement modeling', 'Monte Carlo', 'Roth conversion', 'Social Security claiming', 'savings rate', or 'is my client on track'. For planning-tool data flows, capital market assumption governance, or connecting planning software to CRM/PMS, use financial-planning-integration instead."

Financial Planning Workflow

Core Concepts

Client Profile and Data Gathering

The financial plan begins with a structured intake that captures the client's complete financial picture. Incomplete data leads to unreliable projections and missed planning opportunities. The advisor should collect the following categories systematically before any analysis begins:

**Household demographics** — ages, marital status, dependents (ages and expected years of financial support), health status and family longevity history, employment status and expected retirement dates, state of residence (for state tax modeling).

**Income and benefits** — gross salary, bonuses, commissions, self-employment income, rental income, pension details (defined benefit formula, COLA, survivor options), Social Security statements for both spouses, deferred compensation schedules, stock option or RSU vesting schedules.

**Expense analysis** — fixed obligations (mortgage, loan payments, insurance premiums, property taxes), discretionary spending (travel, dining, entertainment), irregular expenses (home maintenance, vehicle replacement, medical), and expected changes (mortgage payoff date, child-related expenses aging out, healthcare costs in retirement).

**Assets and accounts** — taxable brokerage accounts, traditional and Roth IRAs, 401(k)/403(b) balances and contribution rates, HSAs, 529 plans, real estate (primary residence and investment properties with basis information), business ownership interests, cash reserves, and any concentrated stock positions.

**Liabilities** — mortgage balance, rate, and remaining term; student loans; auto loans; credit card balances; HELOCs; any contingent liabilities (co-signed loans, pending legal obligations).

**Insurance** — life insurance (term and permanent, face amounts, premiums, cash values), disability coverage (employer-provided and individual, benefit amounts, elimination periods, own-occupation vs any-occupation), long-term care coverage, umbrella liability, and health insurance details.

**Estate documents** — wills, trusts, powers of attorney, healthcare directives, beneficiary designations on all accounts and insurance policies, any existing irrevocable trusts or family limited partnerships.

**Tax returns** — most recent two to three years of federal and state returns, revealing effective tax rates, deduction patterns, AMT exposure, capital gain/loss carryforwards, and charitable giving history.

Cash Flow Analysis

Cash flow is the engine of the financial plan. Before projecting any future goals, the advisor must establish a reliable baseline of current income, spending, and savings. Key steps include:

1. **Categorize income sources** by stability (guaranteed vs variable), tax treatment (ordinary, qualified dividend, capital gain, tax-exempt), and expected duration (salary until retirement, pension for life, Social Security from age 62-70). 2. **Build the expense baseline** from actual spending data (bank and credit card statements), not estimates. Clients consistently underestimate discretionary spending. Apply a 10-15% buffer if only using estimates. 3. **Calculate the savings rate** as a percentage of gross income. A rate below 15% for clients more than 15 years from retirement is a yellow flag. Document where current savings flow (401k, IRA, taxable, 529). 4. **Project cash flow changes** over time: salary growth assumptions, expense step-downs (mortgage payoff, children finishing college), expense step-ups (healthcare in early retirement before Medicare, long-term care in later years), and inflation-adjusted lifestyle spending. 5. **Identify surplus or deficit** in the current year and in projected future years. A current surplus is the raw material for all goal funding. A current deficit means the plan must address spending reduction or income enhancement before layering on new goals.

Retirement Modeling

Retirement is typically the largest and most complex goal in the plan. The analysis has two phases: accumulation (saving and investing toward retirement) and distribution (drawing down assets to fund retirement spending).

**Accumulation phase** — project account balances forward using current savings rates, employer matches, expected returns by asset class, and tax-deferred growth. Model the impact of increasing savings rates (e.g., saving all future raises). Account for expected lump-sum events (inheritance, home downsizing, stock option exercises).

**Social Security optimization** — model claiming at 62, full retirement age, and 70 for both spouses. The optimal strategy depends on relative earnings, age difference, health, and other income sources. Delayed claiming increases the inflation-adjusted guaranteed income floor. For married couples, evaluate the restricted application and survivor benefit interaction.

**Pension integration** — if the client has a defined benefit pension, model the lump-sum vs annuity decision, survivor