Covisum: Comprehensive Retirement Income Planning Portal

Based on the interview with Joe Elsasser, CFP®,
President and Founder of Covisum

Site: covisum.com
Founded: 2016
Clients: RIAs serving affluent and mass-affluent clients
Value proposition: Social Security Benefits, Income Planning Tools, Retirement Planning, Financial Advisors, and Continuing Education
The executive team: Joe Elsasser, President and Founder
Dan Gaydos, Chief Operating Officer
Katie Godbout, Director of Sales and Marketing
Chris Whitehill, Director of Software Development

Covisum® is a financial tech company that builds software that allows RIAs to see the impact of different decisions within a client’s financial plan. The solution generates client reports based on strong analytics and provides advisors with support by phone, email and chat. Unlike other all-in-one solutions, Covisum tends to make their system’s components function as standalone services that are on par with niche solutions in terms of analytical depth. They follow “the sum is greater than the parts” principle. This year, Covisum launched a comprehensive retirement income planning portal, Income InSight®, to join other solutions such as Tax Clarity®, Social Security Timing®, and SmartRisk.

Joe Elsasser, CFP®, started out as an advisor over 15 years ago. He was looking for a social security optimizer to empower his own financial planning practice, but he couldn’t find any adequate solutions on the market. Thus, he joined forces with a college friend to build Social Security Timing software that later grew to become Covisum’s first product.

In this article, we’ll discover the company’s primary focus, clients, integrations, development processes, and the priorities that shape its future.

Eliminating the rule of thumb

Covisum - Social Security Timing
Social Security Timing

After releasing Social Security Timing, Covisum launched Tax Clarity software in 2016. Users often struggle to properly calculate the tax impact on retirement income, which leads to unexpected losses. Tax Clarity is about making smart income withdrawal decisions and navigating interactions between incomes that create marginal, unexpected tax rates.

“The general public believes they can operate on a rule of thumb. In pretty much all of our tools, our focus is on identifying the biggest issues where people might think they know what they’re doing, but then get an unexpected result.”

Similarly, they are on the way to modernizing advisors’ risk metrics via their SmartRisk product. They acquired a company specializing in building heavy-tailed risk algorithms.

This year, they launched Income InSight, a retirement income planning portal that deeply integrates with their other tools and forms a cohesive whole.

Covisum - Income InSight
Income InSight

Integrations and conflicts

Covisum is building a coordinated stack with Income InSight as the center to eliminate conflicts in assumptions between multiple software products:

“Everybody talks about open architecture and integrations as the Holy Grail. But when advisors try to link together multiple programs, they see conflicts in assumptions. There’s nothing worse for an advisor than sitting in front of a client and explaining, ‘Yeah, these are the best tools that exist, but no, they can’t agree with each other.’”

Covisum services are integrated with Redtail and Orion. The company provides APIs in a variety of different capacities such as consumer calculators, which power several Fortune 50 organizations. This way, they empower other wealth management tools to become holistic.

“We have actively worked to reconcile the conflicts in assumptions and results so that the advisor can have that same level of confidence as they have with our own.”

Covisum - Income InSight
Income InSight

Design versus analytics

Joe sees a challenge: a lot of industry focus has gone to visualization at the expense of underlying analytics in WealthTech solutions:

“There’s a fine balance that is important for software companies to mind. Pretty pictures are important but it is more important that the client makes the best decision. We can’t sacrifice analytics in exchange for pretty pictures.”

Another aspect is the complexity of developing this analytics engine. Most companies that have some development staff in-house and some offshore struggle to delegate to the latter any calculation work, and Covisum isn’t an exception. However, Joe says that they don’t mind delegating a variety of user-experience related tasks to outsourced teams. These are important to the finished product but ultimately aren’t sensitive issues.

Covisum - Income InSight. Client information
Income InSight. Client information

Building onshore and offshore

For Joe, when outsourcing work, clear and regular communication is key. It’s important to have a separate development environment for an outsourced team and a clear backlog. They conduct code reviews on everything that comes back, encourage early deliverables, and hold regular standups at delivery meetings. That is essential for making sure that what’s coming back is actually what was expected.

In this framework, Joe says, knowledge transfer is unnecessary. It’s enough to just hire smart, ambitious people who are willing to improve their skills in software engineering and pursue a wealth-management track.

“Part of every review with every manager is [asking,] ‘What are you going to do in the next quarter or year to improve your skillset?’”

The company cares not only about its employees’ futures, but also about its own roadmap. In fact, Joe is personally responsible for growing corporate culture and setting company priorities in the long term:

“We’ve got a pretty formal process for laying out what we’d look like at the end of the quarter, a year, a three-, or five-year period and make sure that we’re making decisions that align with the company that we want to be.”

Covisum - SmartRisk

The bottom line

Despite the wide variety of WealthTech tools on the market, advisors tend to struggle with the same pain points—lack of integration, complicated design, and managing development teams. Covisum is on track to tie user experience and quality analysis together, which contributes to overall ecosystem wellbeing.


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