Family Budget Software Demo and Instructions.

If you're still shopping, the best evaluation results are obtained by looking at the budget tool demo, while following along as you read the directions. When you're using the program, things go better if you print these directions.

The "demo" is the actual spreadsheet, password protected, without the formulas so it's much smaller. You won't be able to do anything but look at it. You'll receive a working non-protected file after you pay for it.

If you try to print the demo from Internet Explorer, or you just click Print in Excel, it won't work well. Sorry, but to preserve content, the demos are password protected, and you have to do this to print.

If you're looking at a demo in your browser (if it says anything other than Microsoft Excel at the very top left of your screen), and want to print, then either save the spreadsheet to a folder on your hard drive, or go back and Right click on the demo link, and then use Save Target As... to save it to a folder on your hard drive, then open it with MS Excel. Tips for working and printing in Excel are here, here, and here. The pages on the free sample comprehensive financial plan print better than the demo.

If you have Excel 2007, then first save the workbook as an xlsx workbook.

When you're using the program, things go better if you print these directions.

Basic input for most all of these Excel spreadsheets: Input your data into the green-shaded cells of the input sheets. This will populate the presentation sheets, where you look at the results. Then you fix mistakes, repeat, format, print. If a cell is not colored green, then it's not an input cell, so you won't be able to do anything with it. If you could, then you may end up damaging the spreadsheet.

You can copy the input sheet to the unprotected Presentation sheet, then make notes there, so you'll know why you did what you did in the future.

You switch between the sheets by either clicking on the sheet tab names at the bottom left of the Excel window, or by pressing *Page Up or Down (pressing the control key and either the Page Up or Page Down key at the same time).

If you're seeing this: ####, then either increase your Zoom magnification number (View, Zoom), or make the column width wider. If you see this: #REF! or #DIV/0! after completing your input, please respond to get a new program immediately. This means data was lost either via e-mail, unzipping, or while making a CD.

If a red Error! dialog box comes up saying your input must be confined to a range of values, and your input was within that range, then the problem is that the input cell doesn't accept pennies. Round the value to the nearest dollar and try again.

Before getting started, save an unused copy of all of the files in a separate folder, so you'll always have the original unaltered files somewhere. Then if you do something like delete a formula, you can easily fix it by copying it from these original files. Then save files you've worked on using a different file name (and into a different folder).

If you don't like a file being read-only, go to Save As, and then go to Tools, General Options, uncheck the Read Only box, then click Save. More tips for saving and organizing files are here.

Programs usually come without sample input data, but be sure to delete all of the sample/client input (everything in green-shaded cells) before inputting your data.

You should make CD backups of all of your work on a monthly basis, and store the CD in a safe location, but not where your computer is. More PC tips are here.

If you're an investing consumer (not a professional financial planner working with clients), then when you read "client, prospect, or they" just think "you." You would be both the advisor and the client (or spouse).

Read about financial planning software support here.

Read about financial planning software integration (sharing data between modules) here.

How to send financial plans to clients via e-mail, without sending the whole program is explained on the Excel help page, here.

Read how to present sample reports to prospects and clients.

How to send financial plans to clients via e-mail, without sending the whole program is explained on the Excel help page, here.

Date conventions: There are several approaches to computing how many weeks are in a month, and all that. To avoid confusion and to get the most accuracy, the number of weeks in a month, days in a year, etc. are done using exact numbers. So you may get some confusing results if you try to audit them using inaccurate methods.

For example (rounded to the second decimal place): There are 366.26 days in a year on average to account for leap year. Dividing this by 12 gets you an average of 30.44 days in a month, and an average of 4.35 weeks in every month. So if you input an expense of $100 per week, the monthly amount will be $436. So if you try to add things up like this and are off a little bit, don't fret (or send support e-mail), as this is the way things are set up to be, and it's the most accurate methodology.

The programs work in weekly mode and not monthly mode. In other words, most data is presented weekly and not monthly. There was debate about this, and the deciding factor was the fact that working people in the Real World get paid and do their shopping rituals on a weekly basis, and so family budget programs works best when they match the patterns of how people actually spend money in the Real World. Because of this, all of the variable expenses are input in weekly amounts.

The Results sheet is protected to prevent a user input mistake from inadvertently destroying formulas, but there is no password, so you can unprotect it to make any changes to the results you want to. Reprotect is after making changes to protect the formulas.

Family Budget Tool User Instructions

Cash Flow Projector instructions are below. Begin here, even if you have the Cash Flow Projector

º Open the spreadsheet Budget.xls or Cash Flow Projector.xls using any version of Excel (V9, Office 2000 or later).

It will open to the Fixed Monthly Expenses section of the Budget (All Expenses) sheet. The Cash Flow Projector will open to the Income sheet because it's better to input incomes before expenses.

Feel free to use Excel's freeze panes function to make it easier to look at. A few of the sheets have the panes frozen to make it easier to work with. They are frozen on cells C6 of the Income Forecaster sheets, F4 on the Variable Expenses sheet, and C6 of the Cash Flow Projections sheets. Go to Window, Unfreeze Panes, to turn it off and on.

Common incomes and expenses are listed in alphabetical order.

º Input the current year into cell AD3 of the Results sheet. For the Cash Flow Projector, input the current year into cell C3 of the Income Forecaster sheet.

º Input your incomes into the Budget (All Expenses) sheet, starting in cell AC6 for normal times, and AF6 for disabled times. Inputting incomes is different for the Cash Flow Projector as you input incomes into the Income Forecaster sheet.

º Input your fixed expenses into the green-shaded areas starting in cell C4 (of the Budget (All Expenses) sheet). Fixed and variable expenses, and debts, are in alphabetical order. Input only in the green-shaded areas of the fixed expenses and debt payments areas.

Fixed expenses are things you pay for that have the same (fixed) costs every month. They may go up and down over time, but compared to the variable expenses (which change a lot in the short-run) they remain the same most all the time. One of the reasons why they are separate is so that you won't have to input expenses over and over again that are the same.

º Input your monthly debt payments into the green shaded areas starting at the top of column I.

º If you want to have a fixed expense that's not already listed, use one of the miscellaneous input areas starting in cell B18 and C18. You can change the names of the miscellaneous expenses from B18 to B37, but not any of the other ones.

º Go to the 2008 Variable Expenses sheet. Now decide whether you want to manually enter all of your variable expenses, or use guessing averages.

If you don't want to enter detailed weekly expenses, then do not input anything into columns G to BF of the Expenses sheet. Input 0 (zero) into cell E3 of the Variable Expenses sheet and then just input your estimated average expense data into column F.

º Start at the top of the sheet in the green shaded areas (cell F6) and start entering what you think are your averages per week. Continue down column F until you're all done.

º If you want to start using Real World numbers, use the appropriate column (weeks beginning on Sunday dates are all in row 3) and enter the variable expense amounts. Keep receipts of all money you spend, and once a week, input them all into the appropriate row and column. You can account for every dollar spent if you like that much detail.

Every time you use another week, add a number to cell E3. You can fiddle with E3 to look at how the average changes as time goes by. The number in cell E3 is the divisor used to compute the weekly averages. This is not an automatic function because it gives the user control over computing averages.

For example, if you're just starting out in the first week of a new year, all you're going to have are two sets of numbers to work with - the Prior Averages in column F and the first week's data in column G.

The amount you spend on variable expenses the first week will be miniscule compared to the prior averages, so to get more control over the average, you can set the number of weeks passed in the year to 1 to add column F and G instead of getting an average by dividing them both by 2 (all of the column's of data are added up and then divided by this number.

So if you have it set to 1, all of them are just added up and the sum is average weekly expense. If you set it to 2, then the total is divided by two, which isn't realistic, because you're not going to have hardly any variable expenses to account for in only one week). When you're in the beginning of the year, you can account for these distortions by fiddling with cell E3 until you think the averages are correct. Yes, you can use decimals here.

You can use blank green or white cells to write notes in. This text doesn't affect any calculations, so don't be afraid to jot down notes. Just don't input numbers into white cells.

º If you want to compare what you're actually spending with what variable expenses you forecasted, estimated, or want to set a spending limit on, you can input these estimates into the green-shaded areas of column A. The monthly numbers you input are then divided by 4.35 to arrive at the weekly amounts in column B. This number is then subtracted from the expense average in column E, and the difference is reported in column D.

Starting in row 290, you can see the summed totals of all estimated expenses compared to the actual amounts you're spending.

If you want to get rid of an expense's red deficit number, here's what to do: Assume you don't want to see any red numbers in cell D65. Take the number shown in cell E65 and multiply it by 4.35 in cell A65, like this: =number in E65 typed in*4.35 You can't do this in cell A65 because of it's a circular reference: =E65*4.35

If you're seeing red negative numbers, this means that you're actually spending more than you input as estimates/forecasts/spending limits.

º Lastly, you want to account for another important family budgeting factor that is commonly overlooked - the expenses of replacing things that wear out and need to be replaced over time. As you will see this is a major expense category, and one of the reasons people in the Real World's budgets never seem to add up.

Go to the Replacements sheet. For each item listed in column A, input data in ALL of the green-shaded cells to the right of the expense item's name.

If any of the fields are blank (zero) none of the figures will work to the right. So if you really want to input a zero amount, input 0.001 instead. There is text in the column headings in row 2 to explain what each input cell is asking for, and why.

Then starting in row 28, all of these monthly total amounts are multiplied by 12 to get annual figures, and then they are all summed up in row 60. The totals in row 60 are then divided by 12, and this amount is then sent to cell C41 of the Budget (All Expenses) sheet (and sent to the Cash Flow Projector sheet in the fixed expenses area under Replacements).

Cell C41 of the Budget (All Expenses) sheet, and the formulas in the Projector sheets, are not protected, so you can change this end result if you want to. Most people are surprised by how much this is, and so they reduce it. This is not a good thing to do as some things wear out faster than planned, and/or cost more to replace than estimated.

The most confusing thing here is the interest rates. For example, in the demo, one may question why the current cost of carpet is only $600, but the present value of this cost is $708. This is due to the difference in interest rates you input into columns D and G. In this example, the cost of carpet goes up 10% per year, but you're only getting 3% in a bank savings account to save for this future expense. So if you put $708 into a savings account today to have money to replace carpet in five years, it will grow at 3%, while the cost of carpet is going up at 10% every year. So the inflation rate is more than the savings rate, so more money is needed to close this ever-increasing gap. This affect is illustrated in reverse when it comes to the next item - computer replacement. The cost of computers drop every year, so the present value is less than the cost of replacing it today, because the bank savings rate is much more than the computer deflation rate. When you input the same numbers into columns D and G, then the present value will equal the replacement cost today.

Repeat the same input in the Disabled Replacements sheet, but keep in mind that you will probably want to tinker with these amounts to account for being disabled. For example, vehicle replacements went from $26,000 to $10,000 in the demo, because one will probably drive less, and care less about having an expensive vehicle, if one is disabled.

That's about it. Then you just look at the Results sheet and look at the numbers.

Budgeting for Future Expenditures or Goals

You can budget/plan/save for future expenditures/goals (in the same year) by simply inputting the expense in the future. For example, if you want to see what affect saving for a down payment on an auto will have on your monthly/weekly/annual "nut," just enter the weekly amount in future weeks in the Expenses sheet.

If you want to have $10,000 at the end of November, just input $10,000 as a weekly expense in the last week of November. The program will compute an average weekly/monthly amount that you'll need to save from now until then.

Computing Gas Mileage

First think of how much gas your Vehicle #1 (you're free to name them what they really are) holds and input that into cell B140. Then input what the total current price of that would be into cell B142. You can use an Excel formula to guess like this (input this into cell B142 if gas is going for $2.16 per gallon): =b140*2.16

Then input how far you think you can go on a full tank of gas. You can do that like this: Guess the gas mileage and multiply that times the number of gallons it can hold. For example, if you have a small new car, and it holds 10 gallons, and you get 26 MPG, enter this into cell B141: =b140*26 (the answer is 26
0 miles)

Record your current odometer reading by inputting it into any green shaded cell in row 141 (the example uses 24,760).

The next time you get gas, put this formula into that same cell in row 141 (after you recorded what it was. This finds how many miles you went since getting gas last. The example uses 26,000). This example is in cell E141:
=26000-24760 Then input the number of gallons into cell E140 (if that's the column you're using) and the cost into cell E142.

Your gas mileage for that tank will be computed, along with the average of all of your other input.

Updating the Budget Calculator and Expense Sheets to New Years

º Right click on the 2008 Expenses tab (or whatever the latest year is on your version). Choose Move or Copy. Click the little box at the bottom that says, Create a copy. A new worksheet will be made with the same data as the one you copied.

º Right click on the new sheet and choose Rename. Then name it 2008 Expenses (or the current year, or 2007 if you were going back in time).

º Input the averages from column A from the Expenses sheet into the Prior Year's Average column (column B of the Expenses sheet. These averages are in column A.

If you're going back more than one year, you would take all of the prior years' averages, and then average them. For example, if you have data of $21.00 for 2007 and $23.00 for 2006, enter $22.00. Actually, if you followed the instructions for year 2006, then that already accounted for 2006's averages on the 2007 Expenses sheet, so you don't need to average them.

º Next change the week beginning dates on the Expenses sheet. Go to cell C2 and edit the date to make it be the first Sunday in January. Then edit cell D2 to make it be the second Sunday in January. Then highlight both C2 and D2, then use the drag handle (the little black square at the bottom right of the highlighted cells, and drag it all the way to the end. If you did it right, then all of the cells in row 2 will have changed to show the week ending Sundays for the whole year.

º Change the number of weeks that passed in cell A2 to 1 if you're doing this on the first of the year.

º Now you'll need to change some formulas on the Budget (All Expenses) sheet. Go to the Budget (All Expenses) sheet and unprotect it (Tools, Protection, Unprotect Sheet.

You can then use the global Find and Replace here to make this really easy. Press Control H, and input "2007 E" into the top field. Then "2008 E" into the bottom field, then click OK. All of the references from the 2007 Expenses sheet have now been changed to the 2008 Expenses sheet.

º Then just start over like you're doing now. As time goes on, you'll have a record of each year, and an average all of those years.

º For retirement and disability scenarios: Just enter the incomes and expenses you think you'll have under these scenarios. For example, if you're disabled, you can delete most vehicle expenses. And when you're retired, you can delete buying work clothes. This may work better if you save a different version with a different file name.

Remember that the whole point is to get averages that are meaningful to you.

Cash Flow Projector User Instructions

º Open the spreadsheet Cash Flow Projector.xls using any version of Excel (V 9, Office 2000 or later). If your file name is Cash Flow Projector.zip, then follow the instructions in the e-mail the file came in to unzip it (turn it into Cash Flow Projector.xls).

Since the Cash Flow Projector just projects the numbers from the current budget, the instructions for inputting budget data are not repeated here. They are above, so if you jumped to here from scratch, some of the directions below won't make sense. Please start above at the Family Budget User Instructions section.

Important: The program's formulas detect zeros in the input cells. So if you want to use a zero on any of the forecasting sheets, instead use a tiny number, like 0.001. Inputting zero will result in it being displayed in red to let you know.

Most everything is projected automatically except global inputting inflation rates, the current year, and people's names.

º First, go to the far left sheet tab - Income Forecaster. The best way to quickly go to the far left sheet tab is to press Control and then keep the Page Up key held down until things stop moving.

Input a default/global inflation rate into cell C2. This is the average you think all of the incomes will grow into the future. You can set any one income item to be different, in any year, as explained below.

º Finish basic input by inputting the current year into cell C3, names into cells G3, K2, and K3, and current ages into O2 &O3.

º Scroll down column A to look for all sources of monthly income you, or your clients, currently have, or expect to have in the future. Input the appropriate items into the green-shaded cells in column A.

For example, if someone is getting $100 per month in alimony from someone else, input $100 into cell A11. If you didn't change the global inflation rate in cell C2, and then this $100 will grow at 3% annually for the whole 76 years.

You have three options on how to control the future of this income. First, at some point, this income will stop. When it does, you can stop it at any day of the year, instead of letting it go a whole year. The demo assumes alimony only lasts for five and one half years.

If you wanted to do this manually, go to cell H13 and input half of the previous year's resulting amount (which is $1,391 per year as shown in cell G11). So you'd input $696 into cell H13. The resulting number will be $716 because it automatically inflated at the global inflation rate.

Now input 0.001 into cell H14 to stop inflation for this year only. Don't input zero because the formulas as set to detect them, and it will be ignored. The resulting number is now $696 in year 6 - which is what you wanted. Now to stop it for good, input 0.001 into cell I13. To do this automatically using basic Excel formulas, and not manually, you'd input this into cell H13: = G12*.6

If you wanted to have this income go for five years and three months, then you'd input this into cell H13: = G11*0.26 The 0.26 is a quarter of a year, or three months. This took one quarter of the fifth year's ending value, and used that as the 6th year's total amount of alimony. To have alimony go for five years and one month, input this into cell H13: = G12*1/12 Here you took 1/12th of the fifth year's alimony to be used for the sixth year. If you wanted to only have it for one week, then G12*1/62, and one day would be G12*1/366

You can use any method you want to control these figures down to the day. Remember to end it for good, input 0.001 into the last year's manual override (in this example, cells I12 and M13). And also remember if you want to use exact figures like this, you'll need to input a tiny number into that year's inflation override to stop that years' figure from being inflated at the global inflation rate (in this case cells H14 and L14).

If for whatever reason, one started getting $600 per month in alimony again in year 10 (four years after getting nothing), and then simply input $600 into cell L13 to restart it again. If you're working with exact annual dollar amounts like this, then remember to stop that year's inflation rate too. In this example, input 0.001 into cell L12.

The year numbers are shown in row 4, above the years shown in row 6, and then the panes were froze on cell C8 to make it easier to see them as you move around the rest of the sheet.

Be sure to stop all incomes and expenses at the appropriate year, because in the Real World, most nothing lasts forever. Alimony is shown in the demo as starting back up in year ten, then stopping the next year, just to illustrate how it works.

Next let's tinker with annual inflation rates as a way to control every number in every year, using the second income item "Bonus" starting in row 16. Let's assume that one's bonus inflates at 6% annual rate every year, and not the 3% global rate.

Input 6 into cell D21. Then use the drag handle (the tiny black box at the bottom right of the active cell) and drag it all the way over to column L. You can just drag it to have inflation be the same rate all the time, or you can input a different rate in every year. The point to remember is that every year has to have a non-zero number input into its Annual Inflation Rate override row, or it will default to the global rate in that year. So you can't just input 6% into cell D21 and expect it to use 6% instead of 3% for the rest of the 76 years.

In the demo, John retires in January of the 11th year, so 0.001 was input into cell M20 to have this income in December of year 10, and have no income in January of year 11.

Continue scrolling down column A and input all sources of incomes as described above.

There is a separate income input section for a spouse, starting after the first person's incomes are accounted for, and summed in rows 167-161. The second input section can be anyone that contributes to the family budget, so it doesn't have to be a spouse. If you don't want to use two income sections, just add everyone's income up and input into the first section only.

There is another summing section showing everyone's individual totals, plus combined total, from rows 313-331.

At the bottom row of every subheading there is a row that shows the percentage difference increase/decrease from the previous year.

The same methodology is used for all incomes on this sheet (and the Disabled Income Forecaster sheet) and all expenses on the Cash Flow Projections sheets.

All of this may seem awkward compared to other family budget tools, but you can only control every number in every year with this software, and basically can't control anything anytime with other software. Amounts change annually, and so for software to be able to handle all Real World scenarios, a little more cumbersome input is required.

You can also just ignore all of this and just use the global inflation rates and have every expense run amok forever, like other software. That's not Real World, and all it takes is one thing to go wrong and your whole forecasted budget will be meaningless. So the more you want your software results to match your Real World life, the more you need to pay attention as you spend money, and input your data exactly like things happen in your Real World.

Special note about earned W-2 incomes: Because of various links between the modules, inputting your net paycheck income into the earned income areas will cause double counting of some expenses, undercounting income, and other distortions that will make the plan inaccurate. So when you’re inputting work paycheck incomes, input GROSS figures. If you make $25 an hour, and work 40 hours, then your gross paycheck is $1,000 per week (so this is about $4,333 per month). Your paycheck will usually be a lot smaller than this because of all of the deductions. It’s important to input $4,333 and not the lower amount that’s commonly referred to as “take home pay.”

We assume that you've already input your family budget data as described in the first section - Budget. This is the second section of the directions - Cash Flow.

º Now switch to the Cash Flow Projections sheet. Common expenses are listed in alphabetical order. Input a global expense inflation rate into cell C2. Try to use a figure a little more than the current reported inflation rate for the U.S. as a whole. This is called the "CPI" or Consumer Price Index. The problem with using CPI figures in the 21st century, is that most all of the numbers that are reported, by most all government agencies, are "phony." So if you read that CPI inflation is 2%, then use 3%, as this is more close to reality these days. Always use at least 1% more than what you read as the current inflation rate reported by the government.

º Cell D12 shows how you manually override the automatic global expense inflation rate for each expense. In the demo, the expense "Alcohol, etc." is inflated at a 6% annual rate, instead of the 3% global rate. This helps illustrate things like the ever-increasing taxes on cigarettes.

Input 6 into cell D12, and then drag it all the way over to the end of the sheet. The next expense, the cost of Bathroom/Kitchen Supplies, is forecasted to only increase at a 2% annual inflation rate, so the same thing was done here. You can get the most realistic picture of your future budget when you can accurately guess the price increases of all expense items. You'll never be right, but at least you'll be going in the right direction. Going in the right direction is the most important thing when you're dealing with financial planning software.

º If you don't want to manually override expenses or inflation, and don't care about letting them all run amok over the next 75 years, then that's basically all you need to do. You just look at the numbers on the Results sheet in the middle of the Workbook to analyze your results.

º Some common sense overrides that are important to use: When the mortgage stops, input 0.001 into the appropriate year to stop that expense.

º For retirement and disability scenarios: Just enter the expense manual overrides, or inflation rate overrides, you think you'll have under these scenarios. For example, if you're disabled, you can delete most vehicle expenses by setting those expenses to be zero (0.001). And when you're retired, you can delete, or reduce, buying work clothes and similar expense that will stop the same way.

In the demo, John and Mary retire in year 11, so you can look at how all of the incomes and expenses were manipulated to account for that. You may want to use these as generic guidelines when making your own financial plan. For example, expenses for hobbies, magazine subscriptions, travel, and the like will probably increase as you stop working and have more free time to play.

º Yes, you can start expenses from scratch that do not exist in the current year. For example, children's college expenses. Use the college expense row, or go to one of the expense rows not used, and then go to the column for the year the expense starts, and enter the estimated annual expense into the appropriate manual override cell. Use a higher inflation rate than you used for other things, as college costs go up about twice as much as the overall CPI index. Don't forget to stop it when it's over too.

Each income, expense, and result number on the Projections sheets has its own set of statistics: Standard Deviation, Maximum, Minimum, Average, and Median. These are shown at the end of the 76-year projections, or in other words, starting in column CA.

Cells C109 - C112 display the percentage of income each person represents of total income.

That's about it. Once you tinker with some input fields, and see what's going on, and get meaningful Real World results that will help keep you out of family budget trouble.

HOW TO CONTROL TAXES ON THE CASH FLOW PROJECTIONS SHEET

Now switch to the Cash Flow Projections sheet.

There are two methods of dealing with taxes on the Cash Flow Projections sheet: Manual and automatic. Manual is discussed in a section below.

Everything on the Cash Flow Projections sheet is in joint-mode, so it’s not broken down by each person’s spending.

Using the automatic method of calculating taxes: Go to cell A1033 in the Fixed Expenses section. Here you will see the cells that control manual vs. automatic tax method selection for the four tax areas (Federal, State, FICO, and Misc./Local). You can control each of the four areas independent of each other. Also, they can be different in Current and Proposed plans for maximum control.

Using the drop-down menu, choose “M” for manual, and “A” for automatic. Manual mode is discussed below.

Here’s how automatic mode works: Every income item that you chose Yes to be taxable on the Income Forecaster sheet, is totaled in each year. This gets total taxable income in that year.

You then choose an average tax bracket (not marginal, as explained in the Average Tax Bracket Calculator section of this manual), for each of the four tax areas. Then this percentage of total taxable income in that year is entered into the expense areas. Yes, you can manually override them in every year.

In the demo, 15% was input as the average tax bracket for Federal taxes. Then when John retires, this is manually reduced to 12%, and when Mary retired, this is again reduced to 10%.

FICA taxes are coded to go away for each person individually in the year they retire. The glitch here is that when the first person retires, FICA goes away for the oldest client, even if it’s the youngest one to retire first. This only results in a few hundred annually as the error. If this bothers you then you can easily make a manual adjustment for it.

If you chose the automatic taxing method, and then choose how much Social Security is to be included in taxable income in cell A136 and A315 via the drop-down menu.

The biggest problem with calculating taxes far into the future is that taxes change way too much. With programs that calculate taxes owed (e.g., NaviPlan), it goes off and just assumes that current tax law will be the same twenty years from now. This has never happened. So you're locked into using these assumptions, and they cannot be changed. So even though it does a good job for the first few years, you're then locked into using something that you know will be wrong after that.

The IFP allows you to control taxes in every year using both methods. So if you think the Dems are going to win a future election, you can show this increase in tax rates then. With NaviPlan, you're stuck forecasting current rates for fifty years, when you know they'll be going way up in the next year.

How to Use the Disability Cash Flow Projection Sheets

In addition to creating a personal budget for normal times and retirement, you can also use the sheets to the right of the Results sheet to forecast what one's budget and cash flow would look like if one breadwinner, or all, were to become disabled (or whatever the term you want to use may be that describes not being able to work and earn an income anymore).

The sheets to the right of the Results sheets were just copied and renamed disabled, so you can do all of the same detailed income and expense forecasting described above.

The short version of how to do this is to delete all of the breadwinner's incomes that are a result of working, while keeping the ones that continue even if they couldn't work (e.g., pensions and investment portfolio income).

Then change expenses to reflect your estimates of what they would change to when disabled. This means increasing medical bills and home entertainment like upgrading cable TV, and also decrease things like travel and vehicle/commuting to work expenses. Then you'd change the inflation rates to reflect the changed expenses. For example, medical bills may increase at 20% for a few years, then decline, or stop.

When all of the numbers are summed up, the bottom line answer of how much monthly disability insurance is currently needed to make your budget while disabled is given in cells O4 - O7 of the Results sheet.

O4 & O5 display how much is needed if both incomes were to be displaced via disability.

O6 & O7 displays monthly need numbers if just one were disabled. All four numbers are assuming all debt is still in place. Cells C16 - C25 display the same information, but assuming all debt was to magically go away.

If you want to determine how much disability insurance would be needed to maintain your current standard of living, just copy all of your input from the right parts of the Workbook, to the left side. Then just delete the earned incomes that will stop, and compare the numbers in column F of the Results sheet. That's an easier way to do it, but it's more accurate to go through and estimate each income and expense to reflect what will be if disabled.

Here's an example showing how to adjust expenses for disability. Since Medical Expenses will go up as a result of disability, this number was increased by raising the variable expenses in row 79 of the Disabled Variable Expenses sheet. When you start inputting the amounts you spend on this expense when disabled, your true figures will appear.

Go through all of the income expense items and repeat this process until all of your income and expenses reflect what you think would happen if one or more breadwinners had to stop working because of a disability.

How to change the range of years shown in the charts on the Results sheet:

Most people won't be around 75 years from now, so showing the numbers in the charts for this long isn't good because it crowds out and steals from the useful visual information of the chart.

These charts are set up to only show data for 40 years (the data range stops at column AP, whereas the range of data goes to column BZ).

Here's how to change it to fit your needs: The first chart like this is the Expenses chart placed around cell J40. First, go to Tools, Protection, and click Unprotect Sheet (no password is required). Now click on the bottom light yellow area in the Expense chart (this is Total Annual Variable Expenses).

A long formula will appear in the formula bar. A little bit past the middle to the right, and at the end, the formula's ending data range is column AP. AP1448 is the range for the year numbers, and AP1449 is the range of the Total Annual Variable Expenses. Both need to be changed.

Use the column heading on the Cash Flow Projections sheets to determine which year corresponds to which column. If you want to change this range to show the whole 76 years, change both APs in the formula to be BZs. If you want to display only 26 years instead of 40, change both of the APs to be AAs. The chart will look funny until you've changed all of the date range areas in the chart in the same manner.

To do this, press the up (or down) arrow key, and the next data range area's formula will appear in the formula bar, ready to be changed as well. When the chart looks right, you've done them all.

How to Input Annual Expenses into RP and RWR's Retirement Software Income Goal Manual Override

After you have determined and input your projected expenses at retirement into the Cash Flow Projector, you can easily transfer this data into RP or RWR's Income Goal Manual Override column. This will get you unmatched accuracy, which means you're taking much less personal risk if you rely on figures from financial planning software.

On the Cash Flow Projections sheet (or the Disabled Cash Flow Projections sheet), go cell E1493.

This is where the row of Grand Total Monthly Expenses Less Taxes was converted into a column of the same data. This was done because the Cash Flow Projector generates data in a row, and RWR wants to see it in a column. User's thought using Excel's Pivot Table function (that converted rows into columns) was too hard, so this feature was added to make it easy.

These numbers do not include taxes because RWR will do a better job of accounting for them.

Be sure to not count college, and other expenses, twice. If you input miscellaneous expenses in RWR, ensure you don't account for them in the Cash Flow Projector too. The best place to do all of that is in the Cash Flow Projector.

Go to the row that corresponds to the first year that the first person will retire. In the demo, this is year #11, or 2016. This is cell E1603. Click on cell E1603.

Now open RWR and go to the Summing & Input sheet. Go to column BV (or CB), the Monthly Income Goal Override columns. The steps are similar for the RP retirement calculator.

Delete all of the youngest person's data in column CB by going to cell CB20, and inputting 0.001 (inputting a zero will be ignored). Then click on the little black box at the bottom right that highlights the active cell, and then drag it all the way down until you get to cell CB89.

This will use zero amounts in the youngest person's income goal to prevent double-counting them. If you accounted for both people's expenses in the Cash Flow Projector, and referenced them here, then you'd be adding figures in column CB to that, so they need to be deleted by using a tiny non-zero figure, like 0.001.

Find the RWR cell in column BV that has the first year of retirement - year 11, or 2011. This is cell BV29 in the demo. Input an equal sign into cell BV29, then go to the top of Excel, click on Window, click on the Cash Flow Projector, then click on cell E1499, and press enter. This will reference the Grand Total Expenses of the Cash Flow Projector for that year.

Before you drag the formula down, you'll probably need to delete the dollar sign before the number in the formula. The dollar sign locks the number up, so if you drag it down with it in there, then you'll have made all of the numbers below be equal to the first year only. By deleting the dollar sign in the formula, the cell references will change as you drag them down.

Now click on the little black box at the bottom right that highlights the active cell, and then drag it all the way down until you get to cell BV89. Now you've copied all of the detailed Cash Flow Projections in RWR (or RP), and they will now be used as the income goals to solve for.

If you get any kind of an error message, it's because you tried to copy and paste the formatted boxes where the data is (in the protected yellow cells).

Now whenever you make changes in the Cash Flow Projector's data, your RWR will reflect these changes automatically (as long as you don't delete, rename, or move the Cash Flow Projector to a different folder).

The cost of living inflation rates you input into RWR will be ignored in years where there is an income goal manual override.

How to Do "What If" Scenarios

Using Excel's built-in Goal Seek functions to do "What If" scenarios: This makes both the Budgeting Tool and the Cash Flow Projector by far the most flexible, powerful, and functional family budgeting tool ever created. You can easily do any "What If" you want to with just six mouse clicks.

For example, if you wanted to see how much you need to lower the amount of Federal Taxes you pay to turn a $100 monthly budget deficit into a $60 monthly surplus, all you do is this:

Click on cell C84 of the results sheet. Pretend, for sake of example, that this is currently displaying a $100 monthly budget deficit.

Now go to the top Excel menu, click Tools, then Goal Seek.

The Goal Seek dialog box comes up with the Set cell: value as C84 (because that's where you were when you started goal seek, you can now change it to C84 of the Results sheet, or any other cell, if need be).

Click on the middle input field, To value:. Goal Seek is asking you, "What do you want cell C84 to end up being after I figure this out?"

For this example, you want to change the $100 monthly deficit to a $60 monthly surplus, so input 60.

Then click on the bottom input field, and then switch to the Budget (All Expenses) sheet, and then click on cell C46 (Federal Taxes). Click OK, and Goal Seek will change the amount of Federal Taxes until the $100 deficit is turned into a $60 monthly surplus.

You can use any results field and any income or expense field you want to. So as you can see, this gives many many times the "What If" capability of any other budget program that is not written in MS Excel.

You can do any crazy "What If" you want to and it won't hurt anything, other than changing the cell value you input into Goal Seek's bottom input field. For example, instead of clicking on cell C46 of the Budget (All Expenses) sheet, you could have clicked on any cell in row 19 of the Income Forecaster sheet, and John's annual rate of increase in his annual bonus would change to a crazy figure like, 600% per year, to make it so. This is not realistic, but you can do this, and any other crazy "What If" you can think of.

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