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How to use the Lifetime Income Projection Chart
How to use the Lifetime Income Projection Chart

This article describes how to read the Lifetime Income Projection chart.

Nancy Gates avatar
Written by Nancy Gates
Updated over a week ago

The Lifetime Income Projection chart illustrates how your income covers your expenses in your Plan.


What you see on the Lifetime Income Projection Chart

Expenses

Expenses and Taxes: The blue line represents an aggregate of expenses, including expenses you modeled in your budget, mortgage payments, debt payments, medical expenses, and calculated estimated taxes. Estimated taxes include taxes on work income, savings drawdowns, and realized gains from after-tax investment returns.

When you enter your details into the Planner, you describe your income and expenses. The plan doesn’t match income or withdrawals to specific expenses. The Planner performs calculations around your income and expenses, and calculates your taxes based upon these calculations. The Planner will aggregate the following expense categories as a lump sum, and then fund the expenses.

  • Recurring Expenses

  • Home and Real Estate Expenses

  • Healthcare Expenses

  • Debts

  • Taxes


Income Streams

Work, Social Security, Annuity, Pension, and Other: These income streams were modeled in your plan. You can make updates by editing your plan. You may want to think of your income streams as stacks building up to your Expenses line.

Require Minimum Distributions (RMDS): This income stream is automatically calculated based on actuarial tables and the amount of money in retirement accounts after your RMD beginning date. You'll see these at the top of your income stacks. When your RMDs meet or exceed your expenses you will not see any Savings Drawdowns in your plan.

Savings Drawdowns

If your income from all sources does not cover your expenses you will see Savings Drawdowns in your plan. Savings Drawdowns are automatically calculated based on any additional income needed to cover your expenses.

Savings Drawdowns are made up of distributions from savings accounts, investment accounts, and retirement accounts based upon the default withdrawal order.

PlannerPlus members can see a breakdown of the distributions by heading over to the Insights > Savings Chart, and scrolling down to the Withdrawals chart at the bottom of the page. This chart aggregates one-time expenses, disbursements, transfers, Roth Conversions, and withdrawals.

PRO TIP: The Lifetime Income Projection Chart is the best place to view your Net Savings Drawdowns.


Deficit

This income stream illustrates a debt account created by the Planner when income and savings are insufficient to fund your modeled expenses and taxes.


Milestones

Hover on the dots above the chart to view key milestones such as paying off your mortgage, the end of working, starting Social Security payments, etc.


What should I look for on this chart?

  • Notice when different income streams start and stop

  • Notice if the income columns are taller than the expense line. This means that you have more income than expenses. Check your setting for Excess Income to manage the surplus.

What should I do next?

  • See how the chart changes if you change your plan assumptions from optimistic to average or pessimistic.

  • See how the chart changes if you update something in your plan, such as working longer, spending less, or saving more.

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