Maxifi planner

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Re: Maxifi planner

Post by bobcat2 »

WoodSpinner wrote: Mon May 27, 2019 4:50 pm

BobK, you seem to know quite a bit about this product — are you affiliated with the company? An experienced user?

I gave the link a quick try and ran into some problems from the getgo. For instance, I am already retired (at age 59, in 2018) but it did not let me enter this. Don’t see any details on Fed vs State taxes so not sure what it is doing. Nor any assumptions on inflation.
I remember well the day I first purchased ESPlanner. It was January 1, 2000, so I guess that makes me an experienced user.

You are working with the stripped down free version so some things you will have to finagle a little bit. But in doing a trivial test case I had no trouble changing the default inflation rate. I suggest your spending a little more time with it.

This is the standard economics approach to household financial planning. ESPlanner and Maxifi are examples of economic based life-cycle optimization models. There are dozens if not hundreds of these models that are used by economic researchers at universities and think tanks. You can't go to an economics focused conference on retirement without several speakers saying some version of the following. -
"For this problem we fed the following inputs into our life-cycle model and obtained the following blah blah blah."
While these models are used extensively for research, the only life-cycle models available for use by financial advisors or individuals that I am aware of are ESPlanner, Maxifi, and Gordon Irlam's Asset Allocation Calculator (AACalc).

Here are links to Gordon's home page and the home page of AACalc.
Links -

Gordon sometimes posts here at Bogleheads as gordoni2.

I haven't used AACalc but I know an actuary who has used it and speaks very highly of it.

In finance risk is defined as uncertainty that is consequential (nontrivial). | The two main methods of dealing with financial risk are the matching of assets to goals & diversifying.
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Re: Maxifi planner

Post by spammagnet »

WoodSpinner wrote: Mon May 27, 2019 4:50 pmBobK, you seem to know quite a bit about this product — are you affiliated with the company? An experienced user?

I gave the link a quick try and ran into some problems from the getgo. For instance, I am already retired (at age 59, in 2018) but it did not let me enter this. Don’t see any details on Fed vs State taxes so not sure what it is doing. Nor any assumptions on inflation.

Also, it is suggesting that I purchase life insurance? Not sure why it would make that recommendation given that I am already retired and my pension and SS benefits continue after I die.
I'm not BobK but have subscribed to ESPlanner, then MaxiFi, for several years, and am familiar with the products.

The basic version of ESPlanner may illustrate the concepts of smooth consumption but has not been improved for several years. It did fairly represent the functionality of the full version of ESPlanner at some point in the past. It does not represent the functionality or improved user interface of the current product, or even the most recent version of the stand-alone ESPlanner, for that matter.

With respect to life insurance, the recommendations are the cash inputs required for the survivor to maintain the (mathematically exact) same level of living standard per adult (LSPA), should the insured die in that year. (Think: loss of earned income, drop to 50% of pension, or SS spousal benefit.) It doesn't consider that a decrease in standard of living may be acceptable to you.

The full version of ESPlanner, which has the same computation engine in the background as does MaxiFi, but is no longer being enhanced, allows you to adjust the life insurance load so the rates match yours. If you set them to 0, that eliminates the cost of insurance as an expense but does not prevent the life insurance suggestion from being calculated.

In comparison, MaxiFi allows the user to adjust the load rate and to enter a stop date separately for each adult. That allows you to adjust the recommended premium to what you'd actually pay, and to impose your own cutoff age. In your case, if you don't want any more insurance, just set the age to 58.

It's still slightly unrealistic in that you cannot force it to consider a level premium over time. I'm over 60 but do want insurance because my wife's living standard would drop if I die right now. The recommended amount tails off a little after age 70. The amounts after 70 are insignificant but not 0.

Realistically, I will get the maximum amount recommended during one of the years during that time because I can't count on being insurable for more later, if required. What I do is set the insurance maximum age at 70, set the calculated premiums to $0, and add a fixed special expense representing my actual premium.

With respect to taxes, details are in the full reports of both ESP and MaxiFi. I doubt the basic version includes that but don't really know. I live in a non-tax state so I don't have experience with the treatment of state taxes, but I know for a fact that they're taken into consideration based on the state where your primary residence is located. (You can record moving multiple times.) Also, state taxes are reported as a separate column in the tax detail report.

As an illustration I've pasted the headers from the tax report and the tax detail reports below. Because it's large, I added numbers to the columns. The headers are one row in the reports.

1. Year 2. Spouse 1's Age 3. Spouse 2's Age 4. Federal 5. State 6. Spouse 1's FICA 7. Spouse 2's 8. FICA 9. Total

Tax Detail
1. Calendar Year 2. Spouse 1 Age 3. Spouse 2 Age 4. Earned Income 5. Capital Gains Income 6. Nominal Asset Income 7. Adjustments to Income 8. Adjusted Gross Income 9. Deductions 10. Exemptions 11. Taxable Income 12. Tax 13. Alternative Minimum Tax 14. Credits 15. Refundable Credits 16. Net Tax

In full disclosure, I am a beta tester for the product and, as is common with other software beta tests, have benefited in the form of having my subscription extended for a few months, for free. Those months of free extension are a small fraction of the years I've paid for, and will continue to pay for, unless and until I find a something better. The opinions expressed here are my own.

edit: struck a word
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Re: Maxifi planner

Post by jmk »

Horton wrote: Mon May 27, 2019 2:16 pm here is one specific thing I learned while using MaxiFi: the Social Security wage base, PIA bend points, and index ratios are indexed to national wages rather than CPI. This may be common knowledge, but I had never given it much thought because the MySSA website does not project any changes to these items when deriving their estimates. MaxiFi support referred me to the SS Trustees report, which shows their assumption for inflation and wages - wage growth is about 1.2% higher than inflation.
Horton, as an aside, the AnyPia program from Social Security Administration allows you to project PIA using various assumptions about national wage increases contained in the SS Trustees Report (I, II, III or no increase)
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Re: Maxifi planner

Post by aebknb »

Trial?: I was asking the Maxifi folks some questions about the program via the Contact link on their website, and they mentioned that I could buy it and get a refund within a few weeks if I didn't like. So I bought it and am right now trying to get up to speed on it.

Prior to buying it I viewed a couple of videos of presentations to financial planners on the use of Maxifi. I thought they were useful. Links to the videos are in the References section in this blog post: ... axifi.html
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Re: Maxifi planner

Post by tooluser »

aebknb wrote: Sat Sep 07, 2019 2:58 pm Trial?: I was asking the Maxifi folks some questions about the program via the Contact link on their website, and they mentioned that I could buy it and get a refund within a few weeks if I didn't like. So I bought it and am right now trying to get up to speed on it.
How'd that work out?
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Re: Maxifi planner

Post by TimeRunner »

One link I find most useful as a MaxiFi Planner user is the release notes, linked almost at the bottom of the main page, and found here:
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Re: Maxifi planner

Post by old_hacker »

So this seems to be the best existing thread to post observations about Maxifi, so here goes.

I bought a subscription to Maxifi a few months back. After modelling my wife's and my finances on it and studying the output for a few weeks in order to understand how to use and what it was trying tell me, I can report the following.

Maxifi Customer Support is Beyond Excellent

Really, excellent isn't a strong enough word. Perhaps exemplary does it justice. I've posted questions to them on a late Sunday afternoon Pacific time where I live not expecting to get an answer until the next day at the earliest and have been pleasantly surprised to check my email an hour later and find an intelligent, human authored, spot on the topic response to my question. This is important because usage of and interpretation of the output of this software is not trivial.

Qualify Assurance Could Use Some Work

I found two bonafide bugs in Maxifi in a few weeks of using it. The California State tax calculations were wrong and in my profile it reported a negative net worth which isn't supposed to happen. Kudos to their engineering team for fixing both problems very quickly and near as I can tell correctly, but I think they would benefit by implementing a formal regression test suite to catch bugs like this before they get to users. It shouldn't have been so easy for a novice, non-financial planning professional user like me to find these bugs.

There Are Still Problems With How It Handles Capital Gains

If you have mutual funds that aren't exchange traded funds, you are likely at some point to get 1099s telling you you need to report distributions of capital gains from those funds on your current year taxes. Likewise, you may very well get 1099s about taxable qualified dividends. Both of these kinds of taxable income are taxed at the favorable capital gains tax rates. Maxifi has nothing in it to account for these kinds of "involuntary" tax advantaged income sources, which means the tax calculations it makes each year will be lower than what they should be. They need to add another user configurable percentage to Base Profile->Settings and Assumptions->Taxes->Regular Asset Taxation to allow the user to configure what percentage of regular assets are subject to the capital gains tax rate each year.

I've alerted the Maxifi folks to this issue and they've admitted its a problem, but there is so far no ETA on when the enhancement will be available to users. Full disclosure: this it the main reason I am making this post. I do wish they would prioritize this so that I can continue to use the software to model Roth conversions that I suspect I need to do over the next 5 years in order to reduce my future years' taxes. A little gentle pressure...

The Lifetime Balance Sheet Is A Bit Screwy

Almost all of the numbers shown to the user by Maxifi are the results of NPV calculations using a discount rate equal to the user configured inflation rate. But the numbers on the Lifetime Balance Sheet are discounted by the configured rate of return of regular investments. This has some odd effects when you start tweaking the rate of return. You increase the rate of return for regular assets in a profile and you watch your total future social security benefits and all the other numbers drop.

I've discussed with their support folks. The explanation seems to be that regular asset rate of return based NPV calculations are useful for their internal optimization algorithms. I can believe that, it makes sense, but I don't understand why it makes sense to display this to us users when everything else is discounted by the rate of inflation.

Support For Modelling And Optimizing Roth Conversions Seems Clumsy

My wife and I have our tax deferred retirement money (IRAs/401Ks) in several different brokerage accounts. When I entered our retirement account info into Maxifi I created separate accounts for each of these. I now realize that was a mistake. I should have entered a single, total sum of retirement account money for me and one for my wife instead, the reason being that the Roth Conversion Amounts and Dates are per account not per spouse. When I start modelling Roth Conversions, I'll need to either distribute the conversion amounts across the several accounts I created or delete all the existing accounts and enter single account totals for me and my wife. A per spouse Roth conversion total that applies to all of a spouses retirement accounts would be handy to deal with this. Be forewarned, too much detail in how your retirement investments are distributed creates more work for you at Roth Conversion modeling time. Just enter per spouse totals.

It Would Be Nice To See Detailed Data On RMDs

I'm paranoid about not doing high enough RMDs to avoid the 50% tax penalty once I turn 70 1/2 (or is it 72 now?). It would be nice if one of the reports had a column showing the RMDs for each spouse in each year. Maybe under Income Overview->Retirement Accounts. This would give me confidence that the retirement account distributions Maxifi is projecting will indeed be high enough to satisfy RMDs. Granted, it looks to me like Maxifi is indeed generating a high enough distribution each year to satisfy RMDs. It would just be nice to see it listed explicitly. Not necessary, but nice icing on the cake.

Estate Maximizing Option

I realize this would likely be a big lift in their code, but I don't want to maximize my spending. I want to maximize the estate I leave to my heirs, subject to generating enough discretionary spending to satisfy my spending needs. I've found I can get Maxifi to do this, sort of. I just keep entering trial Bequest Amounts and running reports until the resulting discretionary spending matches up with what I think I'll need to live comfortably on. But needing to do this makes the Montecarlo stuff useless.

But it would be nice if Maxifi could do this for me. Specifically let me enter an inflation adjusted discretionary spending number (or maybe a list of them over time to account for changes in the future like to handle long term care costs) and then maximize such that I get that discretionary spending I want and what's left goes into my estate. Again, I can see that this would be a big one development-wise, but others in this thread have expressed the same desire.
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Re: Maxifi planner

Post by Rajsx »

I am following
We do not stop laughing because we grow old, we grow old because we stop laughing !!
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Re: Maxifi planner

Post by AnotherBozoOnTheBus »

I'm interested in subscribing to MaxiFi Planner, so I'm happy I found this forum and thread -- super useful!

As a software engineer I always look carefully at any software where I
am required to input and store important or sensitive personal
information. Regardless of where the software is located, either on
your own machine, or in the cloud, there is always the risk, despite
the best efforts of some very smart people, that this information will
fall into the hands of cybercriminals. (If you doubt this, do a
Google search on "solarwinds hack".)

From what I can see so far, it looks like a minimum of Personally Identifiable
Information (PII), beyond date of birth, is required to use MaxiFi.
Heck, I can even subscribe using PayPal so they will not have my credit
card information on file. So my question to folks who are using this program:

Am I correct that MaxiFi requires the absolute minimum of PII to be

Of course if you have huge amounts of money in your retirement
accounts, that could paint a target on your back if cybercriminals
managed to steal customer data from the MaxiFi backend systems. But if
that data can't be linked back to you personally, that shouldn't be an

SIDEBAR: There are financial planning products that allow you to
link bank accounts, brokerage accounts, retirement accounts, and
the like, all to make for a very convenient financial planning
experience. TIAA brands their version of this as "360° Financial View".
This service lets you view your complete financial picture in one place, and share all your account information with your advisor.
But unfortunately security vs. convenience is probably the ultimate trade-off.
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Re: Maxifi planner

Post by TomatoTomahto »

AnotherBozoOnTheBus wrote: Thu Aug 05, 2021 10:14 am Am I correct that MaxiFi requires the absolute minimum of PII to be
Yes, it’s a minimum. For example, you don’t need to give your actual birth day; it’s used to compute SS options and a close date is sufficient.

Your assets are self-entered without needing account information. Ditto employer data.

It makes keeping accounts updated a bother, but the safest data is data never provided.
I get the FI part but not the RE part of FIRE.
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Re: Maxifi planner

Post by Horton »

MaxiFi is currently 20% off for new subscriptions:
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