FI Toolkit
Is this app just for retirement planning?
Not at all. The purpose of the app is to provide education and tools to navigate to a successful financial future. More than half of the apps construction is engineered to provide insight and information that all people need so they can successfully plan to Earn – Save – Invest for a secure future. The other half of the apps construction provides the measurement or the metrics to know when success is achievable. The part about Financial Independence that is often mentioned in the same breadth as retirement. For retirees, this really relates to, “When can I retire” along with the ultimate question, “Will my money last?”.

Can I track my expenses with this app?
You can enter all of your usual expenses for the year which are used as a basis to project future yearly expense trends. The more honest and detailed your expenses are, the better the accuracy of the projection will be. You may want a separate app to track daily or monthly expense items that you then summarize for the year for each category, (e.g., for Gas, Groceries, Rent, etc.) for entry into this app.

How do I determine what my basic yearly expenses are?
This is a common problem for most people. Most do not take the time to track or review their expenses even though most banks and credit card companies create monthly statements with this information. There are a few companies and apps that will consolidate this information for you and even categorize your expenses into handy charts and graphs. These aggregate simplifications can be helpful to determine your yearly expenses although they may not fully differentiate between the basic “necessities” and the “optional” spending groups. Some people use a spreadsheet program to consolidate their own details and sort this out. The app helps a bit with this by allowing input of a basic “yearly” expense or several inputs building up to a calculated total from individual basic expenses.

I’m very young and can’t yet save money. How can this app help?
Financial basics do not get much attention in schools. And, the complexities compound as one assumes more responsibilities with paying bills, home ownership, taxes, and saving for the future. This app helps with understanding the interrelationships and terminology for planning a future where “Earn – Save – Invest” should be the focus of your thinking.

I have retirement funds but do I have enough?
Having enough money for an adequate retirement is the biggest fear for potential retirees. This app may help to answer that question or at least help you formulate the right questions to ask a trusted adviser. The answer(s) depend on numerous factors which the app can consider to then project likely outcomes. You may need to consider alternative scenarios (lifestyle changes) to stretch your funds further than your initial calculations suggest. In some cases, the app may reveal that you have more than enough funds available because of your savvy savings ability and conservative spending.

Does the app account for taxes?
For people withdrawing from retirement accounts and investment funds, taxes are an often overlooked expense. The app considers basic tax law legislation and rates for the current year and projects their impact for the future. The taxes are estimated using simplified methods and assumptions as outlined in the app’s documentation. In most cases, these simplifications and assumptions consider a neutral to conservative position, meaning they don't unduly bias the results to be more favorable than deserved. Since tax law is forever changing and complex, consulting a tax adviser for a specific tax year or withdrawal plan is strongly encouraged.

I started late at saving money. How does the app help me catch up?
It may not be too late for you, but you may have to work harder at it to catch up. Time is a precious commodity that favors the early saver/investor. The app can help you save quicker by focusing more clearly on your earnings and expenses moving forward. You may need to test various notional plans (scenarios) to see which direction in-real-life you might want to take to more quickly reach your goals.

Is this a budgeting app and what’s the difference?
Budgeting apps often set monthly budget limits that then allow you to track your spending against those limits. When considering the earnings from a paycheck minus the usual deductions, most people figure what’s left as the “budget”. The full amount gets spent, and the pattern of living from paycheck to paycheck is an easy trap to fall into. This app prioritizes contributions to savings (as an obligation to yourself) that you invest for future years. It also considers your basic spending “necessities” along with separate discretionary spending “optional” on a yearly basis. The app uses this information to project the likely success for having enough money to last into your retirement years.

… and a follow on question:

What if saving for the future is just not possible? I’m living paycheck to paycheck, what should I do?
If your “necessities” and “optional” spending exceeds your net paycheck amount with no money going into savings, your financial future is not healthy. Lifestyle changes need to be made. This is when examining your “necessities” and “optional” spending and cutting out non-essential expenses is required. Earning more money should also be a priority that hopefully includes an employer assisted savings plan. The app can help you model different scenarios moving forward to help make those lifestyle decisions.

I’m retired, how is the app helpful to me?
You may be concerned with how long your money will last, and, taxes. The app uses your current financial information to calculate the distributions needed to cover your projected expenses and estimated tax bills. You can also include notional expenses that may occur to test the various scenarios you might encounter in your later years. Gaining some insight into those projected futures may bring peace-of-mind throughout your retirement journey.

Do you have recommendations for a Financial Advisor?
Just that your chosen advisor should have Fiduciary responsibilities to you and not have conflicting interests in selling products from their firm.