MasterPlan includes a specialized form called the Investment Model Form. The form looks and behaves much like a spreadsheet. You can use it to describe the various components of a complex financial transaction year by year (for up to 99 years).
For most data entry, you will probably use the "simple asset" forms (such as stocks, bonds, mutual funds, all cash type accounts, notes and real estate).
However, when you want to describe assets of a more complex nature such as limited partnerships, stock options, business interests, or nonstandard "simple asset" models (such as a note with an unusual payment schedule), use MasterPlan's Investment Model Form.
Although we call these "pictures" of financial transactions Investment Models, they really don't have to be investments at all. They could also be liabilities, gifts, sinking funds, or specialized income or expense items.
For example, if you have a client who is planning a major purchase in the future, you could model a sinking fund to illustrate the interrelated effects that various rates of savings and return will have on his income, taxes, and net worth. Or perhaps your client intends to begin a gifting program to his children or grandchildren. You can describe this too using MasterPlan's Investment Modeling feature.
You can also use the Investment Models fom to describe limited partnership investments owned by one or more of your clients.
Each time you create an Investment Model, MasterPlan stores it in the Models Library; it is therefore available to any client on the system.
Always define a model in terms of one unit. Then you can easily assign the same model to more than one client by changing the number of units each client owns.
Since MasterPlan places no limit on the number of Investment Models you store in your database, you can create as many as your disk will hold.
For a complete description of each Investment Model data entry field, their relationships to each other, and the reports that contain this information, press the [F1] HELP key at each data entry item, or read the descriptions in Investment Models - Spreadsheet Tab.
An Investment Model has several parts.
The Spreadsheet Section
This section includes some information at the top such as the name, category of model, number of years it will last, etc. You may use formulas, the F6 key, or enter figures directly.
The Description Tab
This tab describes how each client owns the model. It includes information such as the number of units owned by each client and the month and year the client invested. This acquisition date defines Year 1 of the model for each client.
For example, let's assume that you define a limited partnership that is offered for three years, from 1995 through 1997. The cash flow, taxability, and net worth are the same in the first year a client invests, but very different for each year they hold the investment.
You only need to define the Spreadsheet Tab of partnership once. When you attach it to a client's portfolio, you tell MasterPlan the year and month acquired on the Description Tab. When MasterPlan runs the reports, it knows if Year 1 of the Spreadsheet applies to 1995, 1996, or 1997.
The Retirement/Payout Tab
This tab only includes two pieces of information: the checkbox labeled, "Use this asset for retirement," and the Plan Type.