What do I need to know about how the Lifetime Planner calculates yearly cash flow?
By using the planning decisions you entered in the plan assumptions, the Planner can calculate what your income and expenses are in each year. Your cash flow is simply your income minus your expenses, including savings.
To calculate the cash flow in any year, your income and expenses are adjusted based on the increase or decrease you forecast. For example, living expenses increase by the inflation rate you forecast.
Each year's cash flow calculation depends on the decisions you've made. The number of active decisions varies from year to year.
The Lifetime Planner performs the following calculations to determine your cash flow in a given year: