How does Lifetime Planner account for mortgage and paycheck details?

Question

I'm confused about whether to include (or exclude) line items from paychecks and mortgage payments in Living Expenses.  i.e. payroll deductions for medical insurance, pension, 403(b); mortgage items for interest, property taxes, etc.

Scooterlam · Answer

Very good questions.   Mistakenly double counting expenses can contribute to odd results in Lifetime Planner, for sure.

Here's what I did or currently do....in the Planning Assumptions dialog, using the examples you mention in the OP....

Salary - Included my GROSS salary only, as indicated in the dialog.

Living Expenses - Medical Insurance et al.   Click on the help and find some suggestions for what is a living expense and what is not.

Investments - Contributions to pension, 403b or other investment or retirement accounts can be included here. Of course, this assumes that you have included the investment account(s) in LTP.

Current Homes & Assets - Mortgage and associated line items for interest, insurance, property taxes....I include Home Improvement  and maintenance expenses here as well.     Including these expenses here rather than in Living Expenses help me do what-if planning around selling and buying a new home later on down the road, as home related expenses stop when selling a home in the planner.  Of course, these home related expense items assume you have included your home and mortgage accounts in LTP

In recent years, I've been using the budget tool to help organize inputs to LTP.  That has been very helpful.   Granted, not having all my expenses consolidated in Living Expenses dialog can get confusing at times.  But, you can see your consolidated expenses in the Plan Summary tables for any given year.

Don't forget to click on the help icons found in the various planning assumption windows.  They are context sensitive and provide a decent amount of overview.

Salary:

Investments:

Current Homes & Assets: