There are two important terms related to withdrawals at Boldin, and those are Net Savings Drawdowns and shortfall withdrawals.
Net Savings Drawdowns are withdrawals that reduce account balances for a particular year.
Shortfall withdrawals are withdrawals that occur in specific months when there is a gap between income and expenses.
The Boldin Planner will automatically fund the expenses in your plan. It will first use any available income from work, Social Security, pensions and annuities. When that income is insufficient to fund expenses, the Planner will create shortfall withdrawals to fund the remaining expenses.
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One thing you may want to be aware of is that interest income is not used to fund expenses. So, it may appear that the income funds expenses, but you are also experiencing a net savings drawdown.
Shortfall withdrawals are made up of distributions from savings accounts, investment accounts, and retirement accounts based upon your Withdrawal Strategy and Withdrawal Order.
PlannerPlus users can look at the Surplus-Gap chart to see their income compared to expenses and any surplus or gap on an annual basis.
If the years where there are "Funded Gaps" or light red bars pointing downward which correspond with the savings drawdowns in question, you have an annual Net Savings Drawdown.
Another thing you’ll want to be aware of is that there may be years where you have shortfall withdrawals but no net savings drawdowns. Under the hood at Boldin, expenses are paid monthly, while our charting reflects annual amounts. So there are times when shortfall withdrawals are taken in January or February to pay expenses and taxes yet the income received so far is insufficient to fund those expenses. In this case, shortfall withdrawals are taken but replenished prior to year end when more income is received. In the years where you see a saved surplus and a gap you are likely drawing on savings to cover expenses early in the year and do not have you have an annual Net Savings Drawdown.
