Contributions

As a planner, you likely have some savings goals and priorities. You may contribute to workplace and other retirement accounts, as well as savings and investment accounts for short and intermediate term goals. Our current modeling does not account for contributions directly from an income stream, rather from an overall funding process.

When you enter your details into the Planner, you describe your income and expenses. The Planner performs calculations around your income and expenses, and calculates your taxes based upon these calculations. The Planner will aggregate your expenses and taxes as a lump sum.

How are Standard Contributions Funded?

Once the Planner computes your expenses, the Planner funds your expenses and standard savings contributions. If you don't have sufficient funds to meet your expenses, the Planner will model withdrawals from your accounts. Standard contributions will be realized when there is sufficient excess income after all expenses have been funded. If you don't have sufficient funds to make your standard savings contributions, you will not see the account grow and you may also receive a coach alert.

How are Income Linked Contributions Funded?

Income linked contributions will take priority over expenses and be funded prior to expenses. The contribution will be made and may create a gap between income and expenses. When this occurs, the Planner will drawdown from savings to fund your expenses.

Please see How do I add contributions to my accounts? for more detail regarding adding contributions to your plan.

You can determine whether your plan has sufficient funds by looking at the Insights > Surplus Gap Chart.

You can determine whether your account is growing by looking at the Insights > Savings > Contributions and Investment Returns Chart.

For PreTax accounts (401ks, IRAs, Other PreTax), contributions reduce your taxable income.

For Roth accounts, contributions do not reduce your taxable income since these accounts are funded with after-tax dollars.

For HSA accounts, contributions are treated as pre-tax and will reduce your taxable income for federal taxes and all states except California and New Jersey.

For 529 accounts, contributions are treated as post-tax for federal taxes, but as pre-tax and will reduce your taxable income in all states except California, Delaware, Hawaii, Kentucky, Maine, New Jersey, and North Carolina. Indiana, Utah, and Vermont offer tax credits for contributions rather than tax deductions and are treated as such.

Other Savings are considered after-tax accounts. Contributions do not reduce taxable income.

We apply the annual limit for one traditional and/or Roth IRA per person

We apply the annual limit for one 401k/403b per person

We allow annual contribution limits for one 401k or 403b and 457b per person

You have the ability to view your deductible contributions in the Insight > Taxes > Federal Tax Deductions Chart.