For clients that have yet to retire, the Pre-retirement living expenses card can be utilized to capture the household's monthly expenses within the projections.
Pre-retirement living expenses can be entered into RightCapital within the Expenses section of the Profile (or the Expenses step of the initial data entry process), by clicking into the pre-populated Living Expenses card:
If this card has been deleted, it can be re-added by clicking Add Expense > Living Expense. Please be aware that there is a separate card in the Profile > Goals section for Retirement Living Expenses.
Important Note on Living Expenses
When entering living expenses, please be mindful that this number should not include taxes or expenses that you have already captured in the Net Worth section. This includes mortgage and other loan payments, insurance premiums, and property taxes and maintenance fees.
Living Expenses Data Entry
Click on this card to open a data entry drawer on the right side of your screen, allowing you to input the details. There are two options when it comes to inputting living expenses- the quick and easy Simple Approach, and a more granular Detailed Worksheet:
- The Simple Approach will ask you for a single amount, representing the sum total of the client's average monthly spending.
- The Detailed Worksheet allows you to break out expenses into more specific expense categories, the sum of which will make up a client's monthly living expenses.
When using the Detailed worksheet, the expense categories are shared between the pre-retirement and retirement living expense cards, as well as the Budget module. If you've already filled out a detailed expense worksheet in either of these other locations, you can choose to copy the values into the pre-retirement living expense card via the "Copy From" button:
Customze your expense categories!
Budget / expense categories can be customized on a per client basis within the Gear Icon > Settings > Budget Categories tab. This can only be done after completing the initial data entry process.
To learn more about custom expense categories in RightCapital, click here.
Additional Information
Living Expenses will increase each year based on your General Inflation Rate, and can be tracked within the projections by navigating to the Cash Flows module in the Retirement section. Within the Cash Flows > Summary, click into the Expenses > Living Expense column:
