Three Free Financial-Planning Tools
These new interactive Web sites give you advice -- some better than others -- to help you reach goals.
By Thomas M. Anderson, Associate Editor, Kiplinger's Personal Finance
July 14, 2009
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Online financial-planning tools are getting more personal. Plenty of Web sites crank out cookie-cutter plans, but three recent entrants give users more detailed advice. Voyant, SimpliFi and ESPlannerBasic provide something more than a quick-and-dirty look at your financial state of affairs -- for free.
These three sites cannot replace the personalized service of a financial planner, but they are helpful to most investors. You can use them to get a general idea of your finances and benchmark your progress without shelling out thousands of dollars for a session with an adviser. Those who use an adviser can treat the sites as a way to double-check their adviser's plans.
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PROS: Voyant is the best of the bunch. Its slick interface lets you map your financial goals, such as buying a home or saving for your kids' college, along an interactive timeline. It takes less than five minutes to enter the information needed to create a graphic display of your expected income and retirement savings.
You can test what-if scenarios quickly without entering much new information. For example, you can easily adjust the growth-rate assumptions of your investment portfolio with a sliding bar on the right side of the planning tool. Most calculators make you plug in a different rate each time you want to test a new scenario. Voyant also supplies a menu of events, such as starting a business or having a child, to see how those decisions will affect your finances.
CONS: But some of Voyant's premade options are a little too cute. For instance, you click on an icon of a sports car to "plan" a midlife crisis. (If you could prepare for such a scenario, it wouldn't be a crisis.)
No Web site would be complete nowadays without an attempt at social networking -- in this case, a feeble one. Voyant lets you communicate with other users on the site's forums. A button on the tool lets you contact financial advisers who use Voyant's planning software. (The site is still struggling to sign up advisers. When I pushed the button, I was told "financial professionals" in my area -- Washington D.C. -- were not available for an online chat.)
PROS: As the name suggests, SimpliFi is not complicated. The site does a decent job at the broad strokes of financial planning. Spend a couple of minutes entering your data and you get a snapshot of how your goals match up with your savings and investments. An animated guide named Sophie grades your financial well-being from A to F. SimpliFi provides a suggested investment mix for your portfolio and a to-do list for other financial tasks, such as paying down debt or buying insurance.
CONS: SimpliFi's advice is spotty in some areas. The site makes a big deal about its status as an investment adviser registered with the Securities and Exchange Commission, but its investing guidance is generic. Plus, it recommended that my wife and I buy term life insurance even though we have no children, no debt and more than enough savings to cover a funeral if one of us meets an untimely end.
PROS: ESPlannerBasic tackles financial planning from a different direction than the other sites. Instead of letting you set your own goals and working backward, the site asks you a series of questions to determine how much you can spend each year without compromising your lifestyle in retirement. The questionnaire takes about 30 minutes to complete. The site then generates annual spending, savings and life-insurance recommendations.
CONS: ESPlannerBasic's drab interface, similar to Microsoft Excel's, makes using this tool a chore. Plus, you have to estimate obscure statistics on your own, such as your salary in the year before retirement. (How many Gen Xers know that figure?) Granted, ESPlannerBasic is the bare-bones free version -- the advanced copy has more features, including Monte Carlo simulations to forecast various investment scenarios. But after slogging through the basic tool, I don't want to pay $149 for ESPlanner.
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Reader Comments (9)
Posted by: Nate at 07/15/2009 11:13:45 AM
A note to the author: you were recommended life insurance because you are married. If you were to "meet an untimely end", your wife may have enough in savings, however you would probably want to provide more for her than just that. You would want to provide her with enough money to put her in solid financial condition right? What if she lost her job after you were gone? That is just one of hundreds of simple reasons why you would want life insurance available for your wife. You need life insurance (and term-life is so cheap right now - why wouldn't you get some?)...
Posted by: Don at 07/15/2009 06:46:23 PM
I agree with Nate... Life Insurance isn't just for paying off debts and putting you 6 feet under. You have an income and other things you're bringing to the table that will be gone. A comment like that really makes me wary of even considering the rest of the article or future articles if I would happen to remember the name of the author.
Posted by: Nick Kakavas at 07/15/2009 09:16:17 PM
Ditto.
Posted by: experienced at 07/16/2009 10:31:13 AM
Life insurance is a must in the event of a death. Funeral homes will take care of all insurance details leaving you wife or others free to mourn you in peace. It can get very traumatic when death comes. This is one detail that I don't want anyone to worry about.
Posted by: Thomas M. Anderson at 07/16/2009 01:12:35 PM
Hello Don, Nate and experienced. I'm the author of this story. I appreciate your comments. To clarify, my wife works, we have no kids, no mortgage and a decent amount in savings and retirement accounts. We also have some life insurance from our employers. When we have a mortgage or a kid, we will get more life insurance. But the point I was trying to make in the review is that a more sophisticated financial planning tool would have understood my financial situation better and not recommended I buy nine times my earnings in life insurance. Hope this helps.
Posted by: Linda C at 07/22/2009 10:45:57 PM
Could not get Voyant to work properly on my Mac. I kept getting some "Java error" message so I gave up.
Posted by: Dana at 08/07/2009 01:50:45 AM
Online tools are really helpful when it comes to managing finances. I use one too. It's called Billeo. It's a free browser plug-in that tracks my expenses, which in turn helps me make a better budget each month. It also saves receipts, manages passwords and sends reminders when bills are due. Very handy!
Posted by: Bedda D\'Angelo at 09/03/2009 01:34:55 PM
I was looking for some free online tools to recommend to clients so I tried Voyabt, Simplifi, and ESPlanner. I entered the same data in each program and then cross tested the results by entering identical data into EISI Naviplan, Money Guide Pro, and Moneytree-three programs that are popular with licensed CFP's. The only one that is even reasonably close to accurate is ESPlanner. Voyant and Simplifi may be easy to use and visually prettier but what use are they if the output is wrong?
Posted by: short positions at 11/25/2009 09:41:54 AM
I was looking for some free online tools to recommend to clients so I tried Voyabt, Simplifi, and ESPlanner.