# Calculation of Total Spending

1

You can probably find a much fuller explanation in the Help manual, but total spending includes consumption. Total spending (the last col on the right) is the sum of all the columns on the left (including the first col which is consumption). I typically read the chart from right to left. I have the total amount to spend, subtract everything going left, and the first col, consumption, is my discretionary spending. The only "spending" not shown there is taxes shown on the regular asset report.

2

Why does total spending not include taxes? How does one plan for withdrawls from IRA's etc. when taxes are not factored into the spending totals?

Thanks,
Bob

3

Bob,
Total Expenditures include Total Spending, Taxes, and Savings. So Taxes are considered.
An easy way to see this is in the on the Regular Assets page where you cans see that Total Income and Total Expenditures are equal.

It's really a matter of how we defined terms.
We have defined Total Spending as a subset of Total Expenditures.
Hence, Total Expenditures and Total Spending are not the same thing.

Mike

4

Mike,
This is helpful. I see then that total income = total spending + taxes + saving.

I am still confused as to why under total income, ESP has me withdrawing from retirement accounts while simultaniously saving almost twice the amount withdrawn. Since the retirement accounts are tax sheltered and I am only 64 years old, why would I withdraw anything just to put it into non tax sheltered "savings"? This happens twice over the next 36 years in my plan. Once in 2013 and again in 2017.

Thanks,
Bob

5

Bob,

Please confirm that you don't have any Special Withdrawals from your retirement accounts or that your first Smooth Withdrawal Date is after the date that you're seeing unexpected withdrawals.

If these are copacetic, please open a support ticket, upload your database, and I'll look into it.

Thanks,
Mike

6

Re: Taxes not included in total spending report.
The income and spending reports are very usefull to me.
It's confusing, not including taxes as an expense. As it stands, when i use the consumption value I have to remember that Taxes have to paid out of consumption, not easy for this retirement guy.

I rarely look at the total assets report,

Given that, I think the taxes should be included in the total spending column and deducted from the consumption. IMHO.

Please consider this perspective and if possible consider a software change

Thanks

7

jp,
No you DON'T need to remember to to pay taxes out of consumption/discretionary spending!

Taxes are included as an Expense. They are not included in Total Spending.

Both Taxes and Savings have been paid as an Expense and hence don't need to be paid out of Total Spending.

As you can see on the Regular Assets report,
Total Income = Total Expenses = Total Spending + Taxes + Saving.

We keep Taxes and Savings out of Total Spending specifically so that you DON'T need to remember to take them into account when you look at Total Spending!

Thanks,

Mike