Retirement Spending Model Definitions

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Tax-Sheltered Funds
IRA’s, 401K’s, etc.
 
Taxable Funds
All funds not tax-sheltered
 
Total Funds
Tax-sheltered funds plus taxable funds
 
Need After Tax
Amount of money you would want to live on over the next 12 months if you retired today (after federal and state income taxes).
 
P/T Funds Needed + w/d Taxable Funds
Pre-tax (P/T) money from Social Security, pension, buyout, other income and tax-sheltered funds plus any money removed from your current non tax-sheltered funds.
 
Social Security P/T
Self explanatory.  This increases each year at the rate of inflation from your “current age” using “current dollars”.  The Social Security Administration can send you this information.
 
Pension & Buyout & Misc. Income P/T
Pre-tax (P/T) money from a defined benefit pension plan, selling a company and from other income sources.  Estimate the first year amount in dollars “then”.
 
Mandatory w/d Tax-Sheltered Funds P/T
Required pre-tax (P/T) minimum tax-sheltered withdrawals starting at age 70 ½.
 
Elective w/d Tax-Sheltered Funds P/T
Pre-tax (P/T) withdrawals needed when your other sources do not provide enough income to meet your desire.
 
Total w/d Tax-Sheltered Funds P/T
Sum of pre-tax (P/T) Mandatory and Elective withdrawals.
 
w/d (d/p) Taxable Funds
Withdrawal source when Social Security, pension, buyout, other income and any mandatory tax sheltered withdrawals are not enough.  If other funds provide more money than you desire, the excess will be deposited into here.
 
Total Funds Adj. for Inflation
This is simply your “Total Funds” deflated by the rate of inflation out to each of the 30 years.  In other words, this column presents how your “Total Funds” for each year would look, feel and spend in the year you retire.
 
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