Asset and liability modeling tool

Abstract

A method for modeling financial variables describing a client over a time period. The method may comprise the step of generating a first simulation of the time period. Generating the first simulation may comprise the steps of assigning the client to a first health-related state and advancing the first simulation from a first interval of the time period to a second interval of the time period. A probability that the client will transition from the first health-related state to a second health-related state may be calculated, the client may be randomly assigned to either the first health-related state or the second health-related state considering the probability. According to various embodiments, the methods may also comprise the steps of calculating a client income for the second interval; and calculating a plurality of client expenses for the second interval. Also, the various health-related states may include one or more of a healthy state, a long term care (LTC) state, a disabled state and a dead state.

1 . A method for modeling financial variables describing a client over a time period, the method comprising:
 generating a first simulation of the time period, wherein generating the first simulation comprises:
 assigning the client to a first health-related state; 
 advancing the first simulation from a first interval of the time period to a second interval of the time period; 
 calculating a first probability that the client will transition from the first health-related state to a second health-related state; 
 randomly assigning the client to at least one of the first health-related state and the second health-related state considering the first probability; 
 calculating a client income for the second interval; and 
 calculating a plurality of client expenses for the second interval. 
   
     
     
         2 - 32 . (canceled)