Integrating Toolsformoney.com's investment software Modules.

Integration is the technical term used when the different "modules" (parts of the overall whole) are linked, and thus are able to share data with each other.

What people want most is to have the input fields linked so they won't have to input data more than once, and the end results linked so they can print one module's presentation pages after making changes in another module.

This financial planner software has the best of both worlds - first it's modular, so you don't have spend a lot of money buying everything to get the one or few functions you want. You also don't have to spend more time inputting data that a particular module doesn't need. In other words, if you have one of the huge expensive vendor's financial plan software, and just want to make a simple college funding report, you'll have to input tons of data that has nothing to do with college funding.

Next, if you want the modules to share data, just like expensive financial planning software, you can easily do that too.

You also have the ability to integrate many times more - because with Excel, you can share data between modules all you want to. Even the most expensive financial plan software will only integrate to a point, then you can't make it share data any more no matter what you do.

First a Summary of the Overall Concepts

The first phase of the process is to do a current snapshot of incomes and expenses. This is the family budget making process.

Then you project these amounts into the future using the Cash Flow Projector. If you have big future expenses, like children's college, you'd first crunch the numbers using the College Funding Software, and integrate them into the Cash Flow Projector.

Then in the year you retire, you start using the detailed annual Cash Flow Projector amounts as income goal inputs into RWR.

Then as the assets input into RWR are used up to fund retirement, these changes in asset values integrate into the Net Worth Projector. You can also use these numbers show the changes in asset values in the Asset Allocation Software.

Then you can change the assumed rates of return in detail using the Asset Allocation Software. Then the bottom line overall rates of return calculated by the asset allocation software can be input into RWR's rate of return on assets input fields.

How to Integrate Toolsformoney's Modules Just Like Expensive Integrated Software

Even though these Excel spreadsheets are all separate modules, it's simple and easy to get them all to be integrated, just like software costing thousands annually to maintain. It just takes a few more steps when you initially start working on a new client. For investors, it only takes doing these few steps once.

The bottom line is you can trade doing a few minutes more work per client for hundreds of dollars in annual savings. You'll also have less bugs/crashes/reboots/spam/time wasted on support calls, etc.

The directions below are worded for financial planners using these financial planning software modules to do work for their clients. The same steps pertain to investors using the tools for themselves.

Once you understand the basic concept of Excel cell references, you can use them to quickly and easily share data between all of these software modules.

All of this will work just fine as long as you don't rename the spreadsheets, delete them, or move them to a different folder, after you link data.

When you change the data on one spreadsheet, the changes will automatically flow into the other spreadsheets, whether they are open at the time or not.

This is called "cell referencing" and is basically the Microsoft way of doing the exact same thing to integrate as other software platforms. You can share any data you want to - client's names, ages, asset values, cash flow numbers, so you won't have to input the same things over and over.

First, decide what types of work you are going to do for the client. That will tell you which of the modules you'll be using. For example, if you're going to use the Asset Allocation Software to run an investment asset allocation report, College Planning Calculator to show them what they need to do to send kids to college, Life Insurance Need Analysis to see how much life insurance they really need, and an overall financial plan showing what their financial future/retirement will look like before and after your brilliant recommendations, you'd use the RWR Retirement Planner combined with the Cash Flow Projector.

Once you know the tools you'll be using, copy these five spreadsheet into a unique folder. Once all of the files are all in one happy spot on your hard drive, the rest is automatic, and will almost never cause you any maintenance or problems. Tips on organizing files for financial planning clients are here.

Open all five files using Excel at the same time (Life Insurance Calculator, Asset Allocation, College Asset Allocation, Cash Flow Projector, and RWR).

First, run the asset allocation report. When it's done you'll have the totals for personal and qualified assets. For example, after the asset allocation report is done, you'll have the total amount of personal assets in cell B15 and the total amount of qualified asset in cell B41 (see the demo).

Now when you're using the RWR retirement planner you can use this data as input into the asset sheets. Assuming you want to input all of the personal investment assets into RWR's Oldest Asset #1:

Go to cell A6 (RWR's Oldest Asset #1) and enter an equal sign. Do not press enter - leave it hanging.

Next go to the Window menu, and switch to the Asset Allocation workbook. Click on cell B15 and press enter. Cell A6 of the RWR asset sheet will now get its data from cell B15 of the asset allocation workbook (total non-qualified assets). If you tinker with the asset allocation workbook later, and the total in cell B15 changes, it will automatically be updated in RWR, whether it's open at the time or not.

Do the same thing when you make a new RWR asset for the qualified money (IRA's, 401ks, etc.). More than likely, they all will have about the same rate of return, and they are all probably taxed the same way, so it's fine to lump them all together while using the Flexible payout option. Repeat the process above, but click on cell B41 instead of B15 of the asset allocation workbook.

If you want to divide the assets up into more than one RWR asset, then you can use Excel's simple summing feature to do that. For example, say you want the John's Work 401(k) and Mary's IRA listed in the asset allocation report to be two different RWR assets.

The IRA's investment totals are listed in cells B26 - B29 and the 401(k)'s assets are listed in cells B21 - B23.

In RWR input an equal sign into cell A6.

Now you can either use the summing function manually, or let Excel to it automatically. To do it manually, you would input: "=sum(" and then go to the asset allocation workbook.

Click on B21 so the workbook name and all are entered into the formula. Then input: ":b23)" and press enter.

Now the contents of A6 will be the sum of all of the assets in John's 401(k). A more experienced Excel user would have just entered "=" into RWR's cell A6, switched to the other workbook, highlighted the data range by dragged the mouse from cells B21:B23, and pressed enter - which takes less than five seconds.

Using these simple functions allows you to control how data is shared between the workbooks. As you can see, you can control everything as precisely as you want to.

Next, let's assume that you want to run an RWR scenario showing the husband passing away at some future year.

Run an illustration using the life insurance calculator.

When everything is done, the total amount of life insurance needed (and assuming they buy this much) is listed in cell I27 of the Presentation sheet.

Make a new proposed asset in RWR for this.

For the market value, again go to cell A6

Enter =, then go to the life insurance calculator, and click on cell I27.

Press enter.

Now make the asset become effective in the year you want to assume the husband passing away, and you now have proceeds of the life insurance module going into the financial plan.

How to integrate the detailed annual cash flow numbers from the Net Worth Calculator/Net Worth Projector, Budget/Cash Flow Projector, into RWR or RP is explained in detail here and here, respectively.

Using the College Asset Allocation tool, you'd just do the same thing between the sheets in the same workbook, rather than between workbooks, as explained above.

Be sure to not count college, and other expenses, twice. If you input miscellaneous expenses in RWR, ensure you don't account for them in the Cash Flow Projector too. The best place to do all of that is in the Cash Flow Projector.

For example, once you've ran the asset allocation part of the college funding tool (using the Asset Allocator sheet of the College software), you'd just go to the Input sheet and for the initial balance needed to go into cell A9, you'd just put an equal sign there and switch to the Asset Allocator sheet and click on cell B24.

If you want the college cash flows to be included in the RWR report, you would just reference the cash flows in column T of the college planning tool Calculation sheet into one of the six manual income/expense fields in the Summing & Input sheet (starting in column AZ). If you're using the Multiple College Calculator, and have more than one student, then use the annual expense values on either the All Kid Public Presentation or All Kid Private Presentation sheet, starting in cell C176.

To integrate total present values of college funding into the life insurance needs calculator: Open the life insurance needs software, and click on cell A35 of the Input sheet. Input the equal sign, then open the single college funding calculator and click on either cell F14, F13, or N14 or N13 of the Presentation sheet. Press enter. Now the life insurance needs will reflect changes in the college calculator. If there is more than one child, then repeat using cells A35-A39 of the life insurance software Input sheet.

So as you can see, with just a little learning of basic Excel formulas and functions, you can integrate these financial planning modules as much, or as little as you want to, and everything will work just as slick as all of the expensive fancy shmancy integrated financial planning software you're used to.

If you bought support, please send e-mail about any questions you may have about integrating the modules.

About Comprehensive and Integrated Financial Plan Software

A history of financial planning software is in the middle of this page

Comprehensive financial planning software means that it covers everything in financial planning. The financial plan software on Toolsformoney.com is not comprehensive, because there are no tax or estate planning software modules.

This is because there are too many cheap tax programs that excel in this on the market already. Always being plagued with implementing estate planning updates and tax law changes, which happen more than annually, is one of the biggest reasons comprehensive financial planner software is so expensive, cumbersome, and full of bugs.

For the estate planning module, we recommend Leimberg's Number Cruncher. It has the most accurate numbers, and their reports print and fit nicely into financial plans made with this software. This way you'd get the best results possible - way better than NaviPlan.

The software developer for Toolsformoney.com (as you can read in the middle on the info page) grew up living in the world of using comprehensive and integrated financial planning software. He used it daily to do his job as a paraplanner, case writer, and investment portfolio manager. He's used and tried everything on the market since the late '80's.

Things have not changed hardly at all in this world, because they are all built around basic financial concepts that rarely change. The only things that really change are tax laws and numbers. Things like college funding, life insurance needs, and retirement planning has been essentially the same since it first came out.

The reason these tools were made was because of the unbelievable lack of functionality of these programs, the annoyance of dealing with the millions of bugs that never get fixed, dealing with dozens of computer crashes and reboots all day long, the problem of not being able to customize presentation pages to show planners and clients information they wanted, and last but not least, all of this software was and still is, way too expensive to both buy initially, and then to maintain.

When it comes to financial plan software, people usually want something that is comprehensive and integrated. This is usually because most users are much more "salesy-people-people" than analysts/experienced computer users.

Experienced users (e.g., paraplanners that do nothing but make plans for salespeople all day) know that having integration for the sake of saving a few seconds here and there by not having to input someone's name twice, is expensive, and usually ends up taking up more time than it saves.

The problems with getting financial plan software that is both integrated and comprehensive:

º That kind of financial plan software is usually very expensive initially and to keep updated annually. If you don't update, they just stop working.

º That kind of financial planner software usually has a convoluted installation/updating procedure, and that usually overwrites Windows (DLL) files to make it work right.

This causes all kinds of bugs where it locks up your computer, or otherwise crashes it and makes you reboot, causes other programs to stop working right, puts icons/favorite/shortcuts all over your desktop and browser to drive you to their websites where they collect all kinds of information about you to sell to spammers and other marketing people, etc.

When this happens, the financial plan software usually stops working when you go to Microsoft's website to update your operating system (because you're overwriting files that the software installation procedure overwrote).

So there is always an endless parade of "patches" to fix an endless array of bugs. Humans being what they are means that all of these programs are filled with bugs and things that don't work right, and will never get fixed. Just getting the software company to admit their programs have the bug in the first place is like trying to pull the horn off an angry rhino. The first thing they ALWAYS do is find some way to blame it on you and your computer so they can get you out of their hair.

º Good financial planning software programmers are usually young, expensive, and flaky; so they quit all the time, which adds to the problem of bugs never being fixed. These kinds of software people rarely fix their bugs unless most all of their customers complain, or the bug causes computers to crash. Fixing the endless list of minor bugs is usually on the bottom of to do lists; because the bosses (salesy marketing types) are always pushing the software people to add new features that they think will make sales increase in the short-run.

º That kind of financial plan software is usually very hard, cumbersome, and confusing to operate, and takes a long time to learn how to use it. Some are so hard that experienced paraplanners need to be hired, which are hard to train/license/manage, expensive, and quit on you all the time. They usually quit right after you send them to expensive software training classes, because it's there they learn they don't want to spend their life working with terrible software.

º That kind of financial planner software can use up to a gigabyte of hard drive space. And use a ton of memory, which makes everything else run slow. It could take forever to run on older computers, if they run at all.

º The presentation pages (that are shown to clients) in that kind of financial planning software can usually not be customized. So after doing all of the work, you still can't show people the results and information they paid you for.

º That kind of financial plan software is usually written in a programming language that's about to become obsolete, which means the software company will have to spend a lot of time and money to rewrite it, and of course they pass these costs on to you (and you don't see any benefit from that).

Even if it isn't rewritten, there are frequent "compiler updates and changes" that make the programmers have to spend resources just keeping things working. The more resources are "wasted" in these activities, the more they pass these costs on to you. When financial software is based in Excel, all of these problems go away.

º Then after the financial planning software market became saturated in the early '90's, along with enormous increases in computing power, Monte Carlo simulations came out to stimulate sales. As you can read here, this really doesn't do anything useful at all (if you know what you're doing), and is just a way to revive flagging sales (and old glory of some well-known aging academicians).

º It wouldn't be written in MS Excel, so you wouldn't be able to use Excel's built-in "Goal Seek" function to do any and all of the "what if" and "Goal Seeking" functions that any other financial planning software can do, plus dozens more that they can't do.

º And last, but not least, that kind of financial planner software is extremely hard to program a lot of functionality (the capability to perform a lot of useful functions) into the program because the combination of integration and comprehensiveness makes it way too complex for the programmers to cope with.

Most are just following the directions of their financial bosses, and while competent to program, are basically clueless on what they're doing and why they're doing it. This is because their degrees are not in anything financial, so they don't know anything about financial planning or investment management. They also have never met a real client, and so they have no idea what they need and want to see.

So the end result is where we are now in the state of the art in financial planning software: The programs that are comprehensive and integrated end up not being able to do very much in the way of making their software work like things really do in the Real World, because it's just too hard.

For example, Ibbotson, industry icon for decades, gave up in early 2006 and was bought by Morningstar. In September '06, Financial Profiles surrendered and was bought by NaviPlan. In August '07, they made their users upgrade to their new version of Profiles, which costs around $1,200 annually. People that didn't want to upgrade were deliberately abandoned because the old version stopped working, rendering all of the past work of inputting client data useless (so they lost everything with no hope of recovering any data. This could never happen using Excel, because if the program stopped working, you could still copy and paste all of the client input into the new version, or another program).

Programmers are going to whine profusely about every new function the bosses want them to do, so they always want more money, less stress, and a shorter work week, or they will quit. This is why are all of these programs cost way too much money, don't work right, are full of bugs, and don't have close to the functionality needed to illustrate what happens in the Real World. This will never change, especially in an environment of flat-to-down markets where people that want and need investment software to do their jobs are afraid to spend the money.

The solution to ALL of these problems nowadays is to just use an existing software platform where billions of people-hours and billions of dollars have already been expended on perfecting the platform the software runs on. In the case of Toolsformoney.com, these platforms are the same as the ones millions of people use daily - they're called Microsoft Word and Excel. Once you have lived in both worlds, you'll agree that the old-school thinking of having to buy the most expensive software to get good results just doesn't apply anymore. Now that computers are so fast, Excel is just too slick to use anything else for serious number crunching.

Up until 2001, you basically couldn't run a 5Mb+ spreadsheet (like RWR) on even the fastest computer. It would just hang up and then die with some kind of Windows lack of system resources error message. The computer we bought new in 2000 running Windows 98 can't even open Dual RWR. The 2001 computer with Windows 2000 opens it, but takes one minute to calculate every time you change anything. The 1.33 GHz 2003 computer with 512Mb of memory running XP takes about five seconds to recalculate Dual RWR every time there's a change. So up until 2003, the only way to go was the expensive software route. Now, you can run 20MB Excel spreadsheets no problem.

TIP: If you're shopping for financial planning software, see if the vendor has a link on their home page that says anything like: Bug list, patches, known problems, etc. This is a red flag that their software is full of bugs (that never get fixed).

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