Expense Starts in Future with Value Based on Totay's Value Subject to Inflation

A retirement planning tool is only as good as its assumptions and inputs. Share your thoughts or ask questions about the internals of the simulation, built in planner assumptions, or planner inputs.
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howardofocal
Posts: 2
Joined: Sat Dec 19, 2015 10:19 pm

Expense Starts in Future with Value Based on Totay's Value Subject to Inflation

Post by howardofocal » Sat Dec 19, 2015 10:28 pm

This is such a simple question but I just can't figure it out.

I want to plan for my wife's Medicare expenses in the future. I know what Medicare costs today. Her coverage starts in 5 years. Can the system calculate what her starting premium will be in 5 years without taking any deductions until then.

jimr
Posts: 518
Joined: Thu Feb 28, 2008 6:48 pm

Re: Expense Starts in Future with Value Based on Totay's Value Subject to Inflation

Post by jimr » Sat Dec 19, 2015 11:19 pm

All planner inputs are specified in today's value dollars, regardless of what year they occur.

So as long as the expense is expected to increase by the inflation rate, I think you can use the additional inputs window to enter a cash flow in the amount medicare costs today, but with the cash flow starting in 5 years, and using a cola type of 'Track Inflation'.

howardofocal
Posts: 2
Joined: Sat Dec 19, 2015 10:19 pm

Re: Expense Starts in Future with Value Based on Totay's Value Subject to Inflation

Post by howardofocal » Sun Dec 20, 2015 1:30 pm

Thanks. I thought that is how it works.

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