BEST FOR: This option is best for checking accounts which typically have low or no rates of return. The default rate of return is 0%.

BEST FOR: This option is best for high yield savings accounts and CDs. The default rate of return is 2%.

BEST FOR: This option is best for brokerage accounts. The default rate of return is set to our Moderate Portfolio, which is 60% stock and 40% bonds with a rate of return of 8.08%. We encourage you to customize the rate of return to accurately reflect your asset allocation and expected return.

When you add an investment account in the planner, you have the ability to choose between the Ordinary Income or Capital Gains tax treatment. Here's a guide to help you understand which to select.

Boldin’s modeling and analysis does not depend upon how each individual holding performs. We do not yet capture cost basis, allocations, or transactions and you will need to make those entries yourself to ensure that your plan is accurate. You have the ability to model your asset allocation and expected return by using our portfolio models or entering a rate of return for each account.

See Asset Allocation and rates of return for more information.

Your cost basis is the total amount you paid for all the holdings in your account, or the original investment amount for tax purposes. This is usually the purchase price, adjusted for stock splits, dividends, and return of capital distributions.

Think of the turnover rate as a way to manage realized gains above those created by distributions. It is the percentage of your account that gets traded on an annual basis resulting in realized gain/loss events.

Capital gains are not taxed until they are realized, and this isn’t an issue in your retirement accounts (they have zero cost basis.) Gains in after-tax accounts are taxed at preferential or lower capital gains rates and not ordinary income tax rates. The brackets are 0%, 15% and 20% and depend on your taxable income. You may incur capital gains taxes in a taxable account, when you 1) sell shares, and when 2) there is internal buying and selling in the account. You may enter a turnover rate to account for internal buying and selling in the account.

When you input a turnover rate, the tool will take the account balance and cost basis, realize the turnover rate as gains, and tax the gains at your long term capital gains rate. If you are a passive investor, holding ETFs or index funds, the turnover rate will be low or negligible. If you have a managed portfolio, managed fund, or trade frequently the turnover rate will be higher, possibly 10% or more.

The turnover amount is then added to the cost basis in the projections.

Example: With a $100,000 balance and $70,000 cost basis, a 10% turnover rate means $3,000 in gains (10% of the $30,000 unrealized gain).

A dividend is a payment made by a corporation to its shareholders. They are often paid on a regular basis, such as quarterly or annually. If you have an account which yields dividends, enter the percentage of the stock’s price paid annually as dividends. The yield should be included in your total return for the account.

For example:

By default, dividends will be reinvested which will increase the balance and the cost basis of the account in your plan projections. They will also be assumed to be qualified dividends meaning any associated capital gains tax will be included in your capital gains tax modeling each year as per IRS regulations.