FinanceBase-Lifetime Finances, More Than a Retirement Calculator


If you want more than the simple retirement calculators that you can find online, explore the lifetime finances planner discussed in this post. It is feature-rich but is easy to use that uses your expenses, income and assets to provide a cash flow and asset movement from now until up to 45 years past retirement. Charts make it easy to see if you have shortfalls in any years and if your assets will last during your lifetime. You can make changes in any year and try various “what-ifs” to see the impact.

For details on the product described in this post, click on FinanceBase-Lifetime Finances which has screenshots of all windows and pages and also links to other products in the FinanceBase application. You can also download the product and try before you buy during the 31-day trial period.

This post provides some insight into the background and design of the product with comments on how to use some of the many features it contains. For a list of the features, please click on FinanceBase-Lifetime Finances, Features List.

First a background is presented followed by a few useful concepts and how the calculations are performed. Next the form of the results is presented followed by the data that are to be entered to obtain results. Some of the important pages are discussed followed  by how to stress-test and perform what-if analysis. The final topic is discusses updating the tax year so that the application   can be used over many years.

Background

On Dec. 12, 2009, I released a retirement calculator (called RetireBase) to this website after extensive testing and review. After posting a press release on MacIntouch on Feb. 22, 2010, it generated a lot of downloads and sales and was well received. It was well-featured and included one page for entering expenses, government pensions, incomes, assets, inflation rates and interest rates. The resulting cash flow from the retirement year to 45 years after retirement appeared immediately in charts and an analysis. It used Canadian federal and provincial taxes and included, among other items, tax free accounts and split pensions.

A little over a year later, I released an update on March 27, 2011 to include US-specific taxes and assets (in addition to those for Canada). New features also included a mortgage schedule, payroll deductions, transfers to the survivor, asset movement control, and yearly changes to all rates, income and assets.

Over the years new features have been added to it and the years included have been extended down to the entry year (rather than retirement year). It has been integrated into FinanceBase but can still be ordered and used as a separate product, FinanceBase-Lifetime Finances (shortened to Lifetime Finances in this post). With all the changes it is now properly a lifetime finances planner and not just a retirement calculator as you will see below.

FinanceBase-Lifetime Finances is built on an industrial-strength relational database called 4D that I have used since the early 1990’s. I originally used Excel for most applications that I provided to multiple users and departments in the company I worked for. However, I found the need to manage the data, the user-interface and the code (in those days it was Macros, now it is Virtual Basic) was too difficult because it was prone to user-interference and was not a good user-interface. I have made many applications that use 4D and have found the separation of data, user-interface and code to be extremely robust and easy to maintain and extend. 4D also provides the basis for such features as password protect and backups that I have included in FinanceBase. The data management capabilities mean that I can easily define, store and quickly retrieve what I need. The programming language and form creation make it a joy to create new features and applications.

I have continued to use Excel and, as you can see by examining the rest of the website, I have recently focused on financial matters that provide an Excel spreadsheet that users can download and use. There is even one that provides a simple version of Lifetime Finances called Estimating How Much You Need In Retirement.

As a quick overview, when the Lifetime Finances product is opened, it consists of the following:

  • FinanceBase menu on Macs which has the About.
  • File menu and a Toolbar which are described in FinanceBase-Overview.
  • Lifetime menu which contains access to Accounts, Accounts Summary, Calculator, Calendar and Lifetime Finances.
  • Help menu which on Windows has the About.
  • • When the Lifetime Finances menu item is selected it opens 2 windows: the main window that has up to 17 pages and the Charts window that has 3 charts and an analysis section.
  • • A third window, Auto Iterate & What-if, can be opened at any time.
Retirement Calculators are Everywhere

If you search for Retirement Calculator on the internet, you will find millions of entries. There are hundreds of free online calculators and many that require a fee. It is such a contested market that I have to bid at least $2 and up to $5 on Google AdWords to be on the first page.

There are a number of very good reviews, but one that stands out is by D. Kirkpatrick (on his Can I Retire Yet? website) from Nov. 22, 2014 that covers 26 calculators  – The Best Retirement Calculators. It also has evaluation criteria, in particular, the concept of Fidelity which is discussed later. Kirkpatrick has 14 posts (so far) that are categorized as Retirement Calculator dating back to 2012. Keep in mind that all but one of the reviews only cover USA assets and pensions. Another source is Stuart Matthew’s Retirement Calculator Evaluations.

For Canada, Million Dollar Journey’s 5 Useful Retirement Calculators – How Much Do You Need to Retire? is somewhat useful. Otherwise, there are a lot of tools that deal with specific areas, rather that a complete lifetime approach.

Why Would I Enter Such a Crowded Field?

When I started, there was nothing reasonable for Canada and what I wanted to do seemed like it would rival what investment advisor use when working with clients. The result was well received, but the market in Canada was not nearly large enough. With some research and work, I was able to adapt it to the USA (as I also did to the other FinanceBase products).

The design objective was (and still is) to make it easy to enter key data and provide easy to understand results. Additional capabilities and features are intentionally not obvious and defaulted to normal values. Once a user is familiar with the application, these can then be used to include as much detail as desired.

This is somewhat like “peeling an onion” where you can go down several layers and still find something that is useful. For example, the user can change any value on a yearly basis or enter expenses for fixed years. There is also a number of neat features that were fun to program and provide useful results such as the Animate capability for the change in assets and their relative percent over time.

The research I did to evaluate what makes a good retirement calculator, such as the Retirement Planning Software and Post-Retirement Risks report issued by the Society of Actuaries in December 2009, resulted in a number of changes to meet their recommendations.

Fidelity and Other Concepts

The Fidelity concept is included in the reviews by Kirkpatrick and Matthews who have consulted on defining it. As stated by them, there are 3 levels of Fidelity that, as defined by Kirkpatrick, refers “to how well each calculator can potentially reproduce reality — the realism of its simulation. In a nutshell, to do a better modeling job, a calculator will need to collect more data, and more accurate data, from you. So, “fidelity” is also a rough measure of increasing complexity“.

Notice that it contains two well-defined concepts: the model is the data collected while the simulation is the calculations. These are used to produce results which are compared to reality. The results are only as good as the data collected and the accuracy of the calculations.

Here are the 3 levels of Fidelity exactly as Kirkpatrick has defined them:

  • “• Low-Fidelity — these calculators will feature just a dozen input fields or less, and usually perform only a simple fixed rate/average return calculation. They feature ease of use, and generally will require less than 5 minutes of your time to produce answers.
  • “• Medium-Fidelity — these calculators add additional fields, usually handling multiple accounts with different asset allocations, and arbitrary financial “events” such as irregular future income or expenses. Generally they might require 10-20 minutes of your time to produce answers.
  • “• High-Fidelity — these calculators will add even more input fields, the ability to compare scenarios, and often Social Security and tax calculations. Generally they will require at least 30-60 minutes of your time to produce answers. And they could easily require several hours to understand all the options, and collect and input all the data to take full advantage of their capabilities. But these calculators have the potential to be most accurate, assuming you take the time to enter good data, and assuming your guesses about the future hold true.”

There are two other concepts that are important: accuracy, which is the proximity of results to the true value and precision which is the repeatability, or reproducibility of the results. The accuracy and precision should increase as the fidelity increases.

FinanceBase-Lifetime Finances falls into the High-Fidelity level. The accuracy of the results have been verified as much as possible using manual calculations and examining pathological cases (called Corner case by Wikipedia) for results at the limit of some parameters. Because of the calculation method discussed below, Lifetime Finances always seems to produce the same results for the same values of the data entered.

Lifetime Finances Results

In my past work, I have learned to work backwards from the form used for the results because it has proven to me to be the best way to define what data you want to capture. Because I find that a “picture is worth a thousand word”, Lifetime Finances produces a lot of charts. These charts are created from tables for each year from the entry year to the last year considered (up to 45 years past retirement).

There are a total of 8 charts (and a few sub charts) that change immediately any time a variable is changed or a check-box state changes. The first 3 listed below (which are located on the Charts window) are the most useful while the others are included on the main window.

  • 1. Available Income vs Expenses (incl Taxes)
  • 2. Excess and/or Shortfall
  • 3. Total Assets By Person
  • 4. Total Income For Person 1
  • 5. Assets for Person 1
  • 6. Total Income For Person 2
  • 7. Assets for Person 2
  • 8. Taxable Income And Taxes

Chart 1 compares Income version Expenses, Chart 2 indicates if you are saving to your assets, taking from your assets to cover expenses or are short of income and assets to cover expenses. Chart 3 shows your assets and lets you know when your assets will be gone. On the Chart 1 example below, Income exceeds Expenses (plus taxes) but only until retirement. As shown on the corresponding Chart 2 example, the columns change from green before retirement to orange after retirement and finally to red (a Short) appears on the last year indicating that all assets are gone and there are too many expenses. Notice how in Chart 3 the assets rise and then fall over time.

The objective is to set the number of years that you feel you will survive to, then make sure that Chart 3 still shows assets in that year. If you have no assets and only pensions or annuities, then use Chart 2 and make sure there are no Shorts showing, thus ensuring that your income exceeds your expenses.

Deciding how many years you want to use is not easy. However it is better to error on including too many years. There are mortality rates for Canada and the USA that are available. For Canada, which is not much different from the USA, refer to Life Expectancy and Survival Probability.

Results are also shown on the main window as tables used in the charts on pages that have similar names to the charts. There is also an Asset Movement page that summarizes, by year, all of the starting and ending values and how the assets have been modified during the calculations.

A result of particular interest is the Analysis section on the Charts window that both summarizes the results and makes recommendations when there are shorts. This is the what is shown for the charts above.

Simulation/Calculations

FinanceBase-Lifetime Finances uses a deterministic calculation. The method is described on the Calculations page of the application and is summarized below. It takes the data you enter and performs the following calculations for each year starting at the tax year selected, with the results shown on the charts window and the charts and the arrays on each page. (The variables indicated are described later.)

  • – the projected expenses using the Expenses Inflation Rate entered,
  • – the projected CPP, OAS and GIS for Canada or SSRB for USA using the Pensions Inflation Rate entered, the projected Salaries and/or Pensions using the $ Amount, % Increase per year, % expected for the pension and the inflation rate entered,
  • – the projected value of each asset using the % interest rate that you enter,
  • – selected federal and provincial for Canada or federal and state for USA taxes (as shown on the Government Values page for the tax year selected) and using the Taxes Inflation rate to adjust the tax brackets.
  • – If there is too much income, the excess is added to assets in the order specified. If there is not enough income, money is taken from assets in the order specified. Both can be set using tables on the Calculations Page by reordering the assets.
  • • The application uses the percentages you enter as to how each person’s assets are to be used.

There are other simulation methods which use stochastic (i.e. probability) models such as Monte Carlo and historical models which I have decided not to use. For example, I still do not know how to interpret a Monte Carlo result which typically shows different futures based on, for example, means and variances of rates of returns, as many lines on a chart nor would I be able to explain it to others. The historical approach typically uses stock and bond market values for past years to present possible futures. As we all know, the past is no guarantee about the future and probably should only be used to indicate long-term averages and high and low limits.

I acknowledge that it is important to have flexibility in setting of rates of return and inflation rates over the years, but I consider it important that you know what values are being used and that they not be random. Consequently, Lifetime Finances permits you to change these rates in any year or any grouping of years. For example, the Rates page shows all of the rates used in the application and all of them can be changed by clicking on a year to show a request window similar to the one below for Expenses. By changing a few rates, the impact on the Assets on Chart 3 will be obvious. This capability also is provided on many of the other pages.

Further to adding more flexibility into the model, the Auto Iterate & What-if window has a number of options that can be tried to remove any Shorts or see what happens when some income or assets are changed over a number of years or a mortgage is included. These results can be saved for later use and comparison purposes.

Gathering Data – The Entry Page

It is important to make it easy for users to enter the required data and to reduce the time involved. For example, many applications, especially those for mobile devices and online, require that the user enter data into a large number of screens. This makes it very difficult to keep track of what was entered and how to make changes.

I decided to use a single Entry page to capture all of the key data and then, if more control is needed, let the user go to other pages to make yearly and other changes. Having Lifetime Finances installed only on Mac or Windows desktop computers provided the real-estate needed. The key results are on a second Charts window and are updated immediately each time a variable is changed so feedback is instantaneous.

On the Entry page, which is on the main window, only the following variables are required before any results are shown:

  • • Person 1’s Year Of Birth
  • • Person 1’s Retire Age
  • Now Expenses – Use the All Other variable and enter any amount desired.
  • Retired Expenses – All Other will be filled in automatically with the same amount. Adjust it to reflect the expected reduction once you are retired. This is in today’s dollars as it will be inflated automatically by the application to your retire age.

Once these are entered, Chart 2 (on the Charts window) shows nothing but Shorts. If desired, enter Expense details for Rent, Property Tax, Mortgage, CPP+EI for Canada and SS+Med for USA or leave until later.

Now you can enter whatever Income and Assets you want and watch the 3 charts on the Charts window change. If you do not have details on any of the items below, just guess. You can come back later when you have them. See the next section for the help that is available.

    • Government Pensions – Start Age and $/Year for each:
      • Canada – CPP and OAS
      • USA – Social Security
    • Salaries and Private Pensions – Enter Start Age when private pensions start. Up to 3 can be entered each with the following:  Name, $ Amount, % Increase per year, % of Salary when retired, % of Inflation when retired.
    • Assets – For each type, enter Starting $ Amount, % Rate, and $/Year that is to be invested.
      • Canada – TFSA, Cash/GIC, Shares, Dividend Shares, RRSP/RRIF
      • USA –  Roth IRA/401k, Cash/CD, Shares, Dividend Shares, IRA/401k

The assets only include those that can be easily added to or used during your lifetime as indicated above. Assets such as a house or a business are not included, but can be dealt with on the Income page (on the main window) where they can be added or subtracted as capital or non-capital. Assets can be moved between types on the Assets pages to adjust for any imbalance over time, if desired.

Lifetime Finances includes an Account manager that you can use to keep track of any accounts you want, including a house plus all of the types mentioned above. You can have as many accounts as you want for any type that you want. It provides a large number of analysis features, one of which is showing your gross and net worth. These accounts can then be totalled on the Accounts page into the types used on the Entry page.

One of the most critical parameter that influences the future is the Inflation Rate. Even using a low inflation rate of about 2% that we have experienced over the past few years, the effect on the cost of living over your lifetime can be significant. For example, after 20 years at 2%, your expenses will rise by close to 50% and after 30 year is will be 80%. While both the Canada and USA federal banks are committed to keeping inflation at 2%, they never get it correct and you must be prepared for it to vary over time.

On the Entry page, you can specify any Inflation Rate you want for Expenses. Because your future pensions may also following inflation (but not exactly) a separate variable is provided for Pensions. A third rate is included because Taxes in many jurisdictions also adjust marginal rates and deductions each year. It is prudent to use a higher than expected Expenses rate and lower or zero Pensions and Taxes rates. Try any values desired and watch the results on Charts 2 and 3.

Including a Second Person

It is important for a number of reasons that there can be a second person involved in the model, calculations and results. For example, two people may share expenses but keep separate assets. In addition, the second person could be a spouse and this needs to be identified as both people receive different tax treatment than two people who share the same expenses.

Lifetime Finances permits either case to be used and it is only a click on two check-boxes to select what is desired. Using some of the features on the Taxes page, the impact on the results can easily be evaluated and often significantly affect your ending assets as shown on Chart 3.

Help for the Entry Page

One of the key recommendations given in the Society of Actuaries report is that help and education are important and often missing from the applications they reviewed.

When I first started, I provided a detailed user manual which I hoped would satisfy this requirement. However, not everyone reads manuals, nor should this be required. Consequently, each section of the manual that deals with a window or page in the application is available as a context-sensitive Help window that can be easily displayed by using the Help item on the File menu.

In addition, at the top of the window, a line has been provided so that a message in red is used by the application to provide comments or alerts after calculations.

After feedback from users, tips have been included which show when the cursor is hovered over a variable or menu for a second or two. There is also a Wizard for explaining each section on the page to help during data entry. It walks you though each variable, section by section.

In addition, the government pensions have a unique help window that indicates the limits and how to obtain the proper values. Getting these values correct is very important and require more than a guess. I have created a series of posts for the Canada Pension Plan that will be of interest for Canadians. I have not done a similar analysis for the USA but they use a similar approach. Here are two links that will get you started:  Social Security Retirement Benefit and Your Social Security Statement.

Gathering Data – Detailed Expenses

As should be obvious from the charts on the Charts window, getting expenses as close to the actual you spend and expect to spend is very important. The values entered into the Entry page are only the starting values and these will likely change over the years. There are two additional pages that you can use to make these adjustments.

Expenses Details Page

A simple budget can be entered on this page. It is provided so that the Retired expenses can be estimated (in today’s dollars) using the expenses incurred Now. These are to exclude rent, mortgage, payments to create an asset and CPP/EI and SS/Medical expenses. Everything else, such as work place deductions (e.g. union dues, life insurance, etc) are to be included. The totals can be easily transferred to the Entry page. (Payments to a savings plan are to be entered as a yearly asset which can be done in a variety of places, but normally on the Assets Per Year page.)

Probably the most expensive item you will every purchase is a house and the mortgage that goes with it. You can enter the mortgage schedule by clicking on the age in the Mortgage area when it is to start. You can enter the principal and interest rate and either use the Yearly payment and Years calculated or use your own values. Keep in mind that if you need a downpayment, this must be entered into the next page discussed below at the proper age.

The CPP/EI for Canada and SS/Medical for USA, can be automatically calculated by clicking on the check-box provided. Self-employment can also be set using the check-box provided.

Changes in any year to any of the expenses (property tax, rent, CPP/EI or SS/Medical and All Other) can be done in the array at the bottom of the Expenses Details page. Click on the Change column and a Change Request window similar to that shown for the Rates page is presented show previously. Keep in mind that inflation is already applied to these expenses and is shown.

Extra Expenses Page

There are many one-time expenses that cannot be dealt with using the Entry page or the Detailed Expenses page. Such expenses as a mortgage downpayment, car payments over a few years, child care payments for a few years or holidays can be easily entered by clicking the start age and using the Change Request window that is similar to the one for Rates shown previously. You can then record what it is for by clicking on the Comment column. If you have multiple one-time expenses for a year, it is advisable to record the amounts in the comments and enter the total expense. This one-page approach was chosen in the design to simplify the amount of data that needs to be captured, make it easy to see what has been entered and make changes easy to do. Most people do not normally have a lot of one-time expenses in a given year so this approach should provide all the flexibility needed.

One of the most talked about concerns is the impact of medical care needed in retirement. Specifically, will there be enough money to deal with having to go into a retirement home or long-term health care. To help with this, there is an area on this page where you can enter the extras wanted for these expenses and the start and stop ages. As the calculations are done, this amount is adjusted, if needed to what can be afforded. Therefore, use this feature instead of the one-time extras column.

On the positive side, the Extras Wanted feature can be used to see how much extra you can spend in retirement, per year, and still keep your assets to the amount desired. For example, you can consider this money for trips or gifts to children and still keep some assets in reserve or as an inheritance.

Adjusting Income and Assets By Year

It is important to be able to adjust income and assets over the years in the same manner as expenses. A few examples have been given above on how changes can be made on a yearly basis. There are a number of pages on the main window that contain tables with an entry for each year. Clicking on any of the columns in the year will open a window where the changes to that year and to future years can be made. The following is a list of the pages that can have changes made.

Assets Per Year Page

Click on any column in any year to make a change. For Canada, there is also a Home Buyer’s Plan for using up to a set amount of the RRSPs and the payback schedule.

Income Page

There is one page for each person. It contains a chart of the following incomes:

  • Canada – CPP, OAS, Salary/Pension, All Other, TFSA, Cash, Dividend, RRSP/RRIF
  • USA – SSRB, Salary/Pension, All Other, Cash, Dividend, IRA

By clicking on the check-box on the upper-left of the chart, the Marginal and Actual Tax Rates for the person can be seen.

There are check-boxes that permit the reinvestment of Cash and Dividends (plus TFSA for Canada) into the Asset for before and after retirement.

A table shows the end amounts in each year for the above incomes plus a Total column and an Available column. If one of the check-boxes is selected, the later column is reduced by the reinvested income.

The second table on the page is for year-end Salaries and/or Pensions and Capital and Other Income. Each has a Change column where income can be added or subtracted. It is in this table that a sale of asset types that are not included on the Entry page can be entered. For example, the sale of real-estate such as a home or a cottage, gifts, lottery winnings, inheritance. If there is a capital gain, use the Capital column. For all Other Income there is Taxable and No Tax columns. For bonuses and other taxable income, use one of the Salary columns and remove the same amount the next year.

Assets Page

There is one page for each person. It contains a chart of the asset types shown on the Entry page.

There are two tables on the page with Change columns where assets can be added or subtracted. If a portion of an asset is removed you have the option of adding it to the No Tax Income column on the income page.

Taxes Page

The Taxes page also has a chart and a table. The chart shows the taxes and income by person while the table provides the data, by year, that are used in the chart.

Many retirement calculators use a fixed tax rate instead of tax information. To allow a comparison of results from Lifetime Finances with these applications, there is a column in the table where a fixed percent tax rate can be set. Click on any year to open a Change Request window to enter the % for as many years desired. To activate this option, the Use Set Rates check-box only need to be clicked on. To help set this rate, the table also includes a Actual % column that is a result of the calculations before the Set % is used.

Because all of the possible deductions, exemptions, etc., are not included in the taxes used in Lifetime Finances, the taxes will not exactly match what you pay. To compensate for this, there is a Adjustment % column (for each person), that can be used to add or subtract a percent of the taxes for the year. The best way to set this value, if you want to use it, is to compare what Lifetime Finances shows to what your tax return shows, for the current tax year, and enter a percent that makes them equal.

If you are interested to see the impact of income taxes on your assets, use the Exclude Taxes check-box. The effect is really noticeable because your assets will likely continue to grow over the years.

For USA married couples, there is an option of selecting a filing status of jointly or separately. Try the options to see what effect it has on the Chart 3 assets.

For Canada married couples that are retired, Lifetime Finances include the option of Splitting Pensions. If there are tax savings they are shown in a table at the bottom of the page. The effect is usually not a lot, but it is noticeable on Chart 3.

A unique feature of Lifetime Finances is that it can deal with the death of one of the spouses. Clicking on one of the radio buttons at the right-bottom of the window will make visible the percentage of the pensions and assets that can be transferred. This feature is very useful for a couple that are concerned if there is enough income and assets for the survivor if one of them has health issues or is a few years older than the other.

Government Values Page

Two of the design principles for Lifetime Finances are to show as much as possible what is being used and what are the results. The  results are covered in the charts, table and Assets Movement page. What is being used for the inputs has been discussed above. This page shows the data used for the taxes. It has 4 table for the USA and 5 for Canada. The Government Values table contains a variety of federal, pension, payroll deductions and limits used to check out-of-bound data entry information used in the calculations.

There are tables for the Federal and Provincial or State tax values used. They indicate the tax form lines and the values used. There is a Change button that can be used to change this data. This is particularly useful if you do not have the next year’s tax file or want to change any error you may have noticed.

A table shows the Minimum Payout Values for RRIF or IRA and lets you set the age for each person when withdrawals are to start.

For Canada, the TFSA maximum contribution is managed to ensure that it are not exceed. For each age, the room available is shown in a table so that changes to this important investment can be managed. I have not included an equivalent calculation for the USA Roth investments. It can be added, if there is enough interest.

Calculations Page

As mentioned previously in the Simulation/Calculations section, this page permits the reordering of assets used during calculations and the ability to override using assets. These features are very useful in determining what works best and how assets are being used.

There is a table for adding excess income to assets where the assets which can be reordered by dragging and dropping the assets in a different order. There is also a table for taking from assets that uses drag and drop. The amounts used for each person is set by the percentages you enter on the Entry page.

In addition, adding and taking can be overridden by clicking off either or both of the Add Excess to Assets check-box or the Take Shortfall From Assets check-box. Chart 2 changes to show the impact by plotting Excess, not added and Shortfall, not taken. Also the Analysis section on the Charts window indicates that these check-boxes are off because the results are misleading.

Stress Testing and What-if Analysis

One of the reasons for designing Lifetime Finances so that almost everything can be changed is to permit the use of high and low values so that a stress test can be performed. For example, using a low rate of return on investments or a high inflation rate will make it clear if assets will last long enough.

Once any changes have been made, they can be saved. By opening another Lifetime Finances window, these changes can be compared to other saved values. This makes it easy to compare a base-line to other scenarios.

The first time data is entered you can expect that there will not be enough money to last your lifetime as specified in the Number of Retirement Years and the last age charted. While it is possible to get your expenses Now to a reasonable value, it is often very difficult to get what you need when Retired. In addition, it is often difficult to determine what income or savings you need.

To help, the Auto Iterate & What-if window (opened by clicking on the Entry page button of the same name) is extremely useful because it does the work for you by changing specific variables until all Shorts on Chart 2 are gone. There are 8 options available, as indicated below. Just follow the instructions by showing the Help window. As the options are run, the appropriate data is changed iteratively and you can see the changes happening on the charts. After the run, or runs, they can be reloaded, compared and saved for later use.

  • – Decrease Entry All Other Expenses-Now
  • – Decrease Entry All Other Expenses-Retired
  • – Increase Entry Person 1 Income $Amount to Retirement
  • – Increase Entry Person 1 Income %Inc to Retirement
  • – Increase Entry Fixed Rate Above Inflation
  • – Increase Entry Person 1 Cash $Amount
  • – Increase Income for Person 1 Taxable/Year to Retirement
  • – Increase Assets for Person 1 Cash/Year to Retirement

At any time and particularly when there are no more shorts, any or all of the What-if cases presented below can be run (and reloaded) and saved. Each of them has a number of parameters that you can set, such as start/end ages, percentages and amounts. Again, the Help window provides all of the details needed.

  • – Assets Decline, All Except Cash
  • – Assets Decline, Shares Only
  • – Change Income or Pension
  • – Increase Expenses Inflation Until Shorts
  • – Increase Expenses-Now Until Shorts
  • – Increase Expenses-Retired Until Shorts
  • – Mortgage

Using Lifetime Finances Over The Years

It is my hope that you will use Lifetime Finances to keep track of your finances over the years. Once you have developed a plan, you should track it to see how you are doing and make adjustments as needed. For example, you will probably need to adjust the inflation rates, your income and your expenses.

Because taxes change each year, and because the Year drop-down menu on the Entry page uses the year selected for the taxes, you need to change to the new year and then update your plan to this new year. The following is how it is done and typically takes only a few minutes.

  • – At the beginning of each year, the past year’s tax information will be made available as a file. It can be added to the Tax Year menu by holding down the Control key for Windows or the Command key for Macs when the menu is selected. The application will ask for a file to be located and selected. If the file is accepted, it is added to the drop-down menu.
  • Or, if the file is not available or you want to not use it, the previous year can also be used. In this case, a Request window will ask if a Duplicate is to be made. The duplicate can be replaced later by the data in the file. You can also update the Duplicate by using the method on the Government Values page described in the Help to modify the tax values.

Once the new year has been loaded, you can use the Load Saved drop-down menu to populate the pages and charts with what you previously saved. Then select the new year from the drop-down menu. You then have the option to use the Expenses, Pensions and Asset values at the end of the selected year to reduce the amount of re-entry of data. A second option will move all data in the arrays up by the difference between the original year and the selected year to keep the ages for any changes the same. If there are Accounts they can also be compared to the new year with the results shown in an Alert.

Feedback

As always, you can send your comments by using the Contacts email form. Suggestions for future features are always welcomed.