Projection Summary

The Projection Summary contains a Projection Status and key numbers from the end of the projection. The end of the projection occurs at the earlier of 50 years from now or when the surviving spouse dies as specified in the Plan section. Your Estate (value after tax), Accounts (balances) any Home Equity, other Real Estate equity and Estate Tax at the end of the projection are shown. These can be displayed in future year dollars or current year dollars (also called Net Present Value or NPV) depending on your selection in the popup menu. The size of the amounts in future year dollars may surprise you but bear in mind the compounding effects of inflation. 50 years ago in the 1970's the average house price was $30,000.

Think of the Estate value as a measure of the efficiency of a projection. The estate value accounts for all income streams, all expense streams, all taxes, all transfers between accounts and the time value of money. If the estate value can be increased without changing lifestyle (retirement ages, budget, charitable donations and downsize/upsize of the principal residence and/or budget) then more money has been extracted from the projection and has been made more efficient. The Optimizers make a projection more efficient.

The Projection Status is based on values you have entered and assumptions made by the spreadsheet. Always obtain independent financial advice. It will contain one of the following: 

Funded: Your retirement is fully funded.

House Poor: You own your home but you will go into debt at some point to live there. Consider downsizing or a reverse mortgage.

Underfunded: Your projection is underfunded in one or more years. Consider working longer, reducing your annual budget and/or changing your retirement fund withdrawal strategy if funds are available.

Accounts Target is where you specify how much money the optimizers should leave in your accounts when optimizing your retirement age(s), annual budget or charitable giving.

Show on Charts: allows you to select whether Age(s) or Years are shown on the horizontal axis of the charts.

Retirement planning typically involves two types of scenarios. The first involves maximizing the amount left to heirs. In this case, a typical lifespan is used and the goal is to maximize your Estate. The second involves ensuring that the retiree(s) do not run out of money. In this case, a maximum lifespan is used and the goal is to ensure your Accounts remain above the Accounts Target. Unlike the Charts which show your Plan over time, the Projection Summary allows you to see the effect of your Plan choices in a single number.

All income streams, all expense streams, all taxes, all transfers between accounts and the time value of money are all rolled into the Estate value.