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Daily Capital

Introducing the Recession Simulator

In the wake of market volatility due to COVID-19, the Recession Simulator provides insights into the effects of past market recessions.

We’re excited to announce that we’re introducing a new product feature to the Personal Capital Dashboard. This new feature is the first free tool of its kind, the Recession Simulator. 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.

Want a clear view of your retirement?

The feature is now part of our popular Retirement Planner tool, 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, we found that the effects of COVID-19 have had a profound impact on people’s retirement plans. Approximately 40.4% of those indicating they were planning on retiring within the next 10 years have ultimately decided to delay their retirement. Approximately 77% 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 visualize the impact market swings can have on their retirement plans and provide 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 (like the 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 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 best 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 peace of mind to pre-retirees and retirees,” says Jim Del Favro, Chief Product Officer.

Sign up for Personal Capital’s free tools to access the Recession Simulator.

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The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.

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