Personal Capital launches Recession Simulator tool

Personal Capital, a registered investment advisor and digital wealth manager, has launched a new Recession Simulator tool. 

Available to all Personal Capital users and wealth management clients, the Recession Simulator allows Americans to illustrate the effect historical past recessions would have had on their nest egg. 

Personal Capital's Recession Simulator allows users to see the effect past recessions would have on their current retirement plan.

The feature is now part of the company's popular Retirement Planner, which runs simulations with your starting portfolio and incorporates expected return and volatility, annual savings, income (Income Events), spending goals, retirement spending, social security, and tax rules for taxable, tax-deferred, and tax-free investment accounts. 

In a recent survey of over 1,000 respondents conducted by Personal Capital, the effects from Covid-19 on people's retirement was shown as approximately 40.4 per cent of those indicating they were planning on retiring within the next 10 years have ultimately delayed their retirement. Approximately 77 per cent of the respondents who are at least 10 years away from retirement expressed some concern about Covid-19's impact on their retirement goals. With recent market volatility due to the global Coronavirus pandemic, the Recession Simulator allows investors to visualise the impact past market swings would have had on their retirement plans and provides invaluable insights to help with future planning. 

To use the Recession Simulator, users can access their Retirement Planner on their Personal Capital Dashboard where they can create a New Scenario to simulate portfolio performance during past market downturns (Dotcom Crash and Financial Crisis). Ideal to align with potential retirement ages, the user can select what age they would like to run the simulation, and generate the simulated plan that displays the portfolio's balance during the market crash, the portfolio's recovery time and overall portfolio probability of success rate relative to the user's retirement goals. 

"We are extremely proud and excited to have the Recession Simulator tool available for all of our users and clients at Personal Capital," says Kyle Ryan, Executive Vice President of Advisory Service. "With uncertainty around the market's performance and overall economy, we want to continue to be a catalyst for providing individuals the necessary tools and insights to position themselves to reach their financial goals under volatile market conditions."

"Originally born during a company-wide Hackathon, we developed the Recession Simulator quickly to help provide some historical insight to pre-retirees and retirees," says Jim Del Favero, Chief Product Officer. 

In addition to launching The Financial Roadmap, Personal Capital has recently executed a successful rebrand, launched Personal Capital Cash, expanded the program to offer Joint Accounts and increased its Team of Experts and Investment Committee all within the past year.