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John D Craig
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Catch 22

1. My model produces a more meaningful and useful retirement planning output than other models of which I am aware.

2. Unfortunately, the model creates a Catch 22.
a. The model requires an initial set-up and continual planning by a highly proficient financial advisor. The assumptions and scenarios used in the model must be selected by someone who has a full knowledge of the individual's situation.
b. Financial advisors that do possess the requisite skills would not use this model because it is not commercial.

3. I have the requisite financial and tax skills to program an Excel model that works for my situation. My personal Excel model is a bit complex and unwieldy, but it could easily be made user friendly by an experienced programmer. An experienced financial planner could then easily adapt such model to his client's situation, and insert appropriate assumptions and scenarios.

4. Use of this model by a qualified financial advisor for each of his clients would require much more time and effort than is currently provided by the typical FA; this model would require the FA to adapt the model and inputs in the best possible way, unique to each client. Unlike other models, this model does not provide uniform formulas and solutions , but instead requires separate analyses for each client. Many clients also prefer simple standard formulas and approaches that they can easily understand; this model may well confuse and upset those clients who are looking for the "certainty", which is purportedly provided by other models. Most advisor fees are based upon a percentage of assets under management. Use of this model would involve considerably more time and effort, for which the FA would receive no additional compensation.

Bottom line: Most individuals and even some FAs do not have the requisite skills to use this model. The qualified FA who uses this model may reduce his client's feelings of "certainty", which other "scientific" and formula models purport to provide. It would also require the FA to apply much more time and effort, for which he typically would not be compensated because of the %AUM fee structure. The FA industry, as it exists today, makes this model non-commercial.
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