Getting Started with RightCapital

To begin using RightCapital for financial planning, the first step is to enter as much information as possible into their setup survey.

Information to gather in preparation for entry into RightCapital:

  • Sources of income
  • Retirement accounts and benefits
  • Bank and brokerage accounts
  • Mortgage, credit card, and other loan information
  • Insurance policies (property, life, health, disability, auto)
  • Financial goals

1. Setting up Family Members

This page is where you set up the members of your family.

You can use hypothetical family members if they aren’t yet in your life. For planned children, you can use a birth year in the future.

Types of Family Members:

  • Co-client: A spouse or partner with whom tax is filed jointly, and/or a beneficiary of an estate
  • Child: A dependant for tax purposes, and/or a beneficiary of an estate
  • Grandchild: A beneficiary of an estate

2. Employment or Retirement Income

This page is where you enter income from employment or retirement plans.

Types of Income:

  • Salary: Income reported on form W-2
  • Self-Employment: Income reported on form 1099 or other income qualifying for a deduction under TCJA
  • Pension: Income from a retirement benefit from an employer
  • Annuity: Income from an annuity which has been annuitized (i.e. no longer accumulating)
  • Distribution: Income from annual withdrawals from retirement investment accounts

3. Saving for Retirement

This is how much you save for retirement. You can specify a percent of income or flat amount depending on any employer benefits.

NOTE: This page only establishes how much you save into retirement accounts. The actual accounts are set up on the following page.

4. Assets and Liabilities

This page is where you enter your financial accounts and other important assets and liabilities.

Linking financial accounts requires your username and password. If security or privacy are concerns, you can add accounts manually and provide the current balance. There are only two small drawbacks. 1) Current balances must be updated manually to generate an up-to-date financial plan. 2) The budgeting feature requires linked spending accounts (e.g. bank, credit card) to categorize transactions.

Types of Accounts:

  • Bank: A checking or saving account. Accounts with debit cards are used for budgeting.
  • Card: A credit card
  • Investment: A brokerage or retirement account which holds securities (e.g. stocks and bonds)
  • Stock Plan: Employee Stock Options provided as a benefit from an employer
  • Loan: Home mortgages, car loans, student loans, or other loans
  • Property
    • Primary Home: Where you are considered resident for tax purposes
    • Investment Property: A property from which rent is collected, and can be sold upon retirement
    • Vacation Home: A property which generates no rental income, but you can specify an assumed sale price
    • Land: Like an investment property, but without vacancy or depreciation assumptions
  • Insurance: Life, disability, LTC, or car insurance policies

5. Living Expenses

This page is where you estimate your expenses.

Types of Expenses:

  • Living expenses: An estimate of your monthly living expenses. You can enter these either by category or as a lump sum.
  • Tax Expenses and Fees: This includes your local tax rates and some assumptions about capital gains
  • Medical: One time or annual medical expenses which may be tax deductible
  • Alimony: Annual alimony payments which are not tax deductible

NOTE: Neither Magnifina nor RightCapital are qualified to provide tax advice. Tax information is used in the context of a broader financial plan.

6. Life Event Goals

This page is where you set up your financial goals. The goal of financial planning to identify the best way to achieve these goals.

Types of goals:

  • Retirement: This is perhaps the primary goal of financial planning. A starting point for estimating expenses is to use your current monthly expenses. These are adjusted for inflation and may exclude certain payments (e.g. primary home mortgage).
  • College: Tuition expenses for a client or dependent. Fees are estimated using averages for the type of institution.
  • Car: The expenses related to buying or leasing a car
  • Vacation: Typically used to plan a honeymoon or very long trip upon retirement
  • Wedding: A lump sump payment for all wedding expenses
  • Property: Expenses related to purchasing any of the property types in Step 5
  • Asset Purchase: Typically used for boats or recreational vehicles
  • Gift: A high value gift to a person or to charity which may be tax deductible
  • Legacy: This is the amount that may be used in an estate after satisfying the other goals