With spreadsheet-based plans, you can manage your monthly and forecast budgets. You can also track saving funds monthly for a future goal, such as a home mortgage down payment. Spreadsheets become challenging to manage if you want to consider many different aspects together in a long range plan. By long range we mean 10, 20 or up to 100 years into the future.
For example, say each family member has a car in your plan, replaced every 10 years. Each car includes its own down payments, loan payments, asset value and maintenance expenses. For a complete plan, you’d add your home mortgage payments and projected maintenance costs. You’d add school expenses and loans for each kid in your family. You’d also add projected health care costs per family member. Your spreadsheet would quickly grow to 100s of rows, becoming more and more complex.
Complex large spreadsheets are tricky to make updates to. What if you want to delay that house purchase a year or two? Or add another kid to your family? You’d have to carefully update the spreadsheet to make sure other financial rows/columns were not clobbered.
Moving Beyond Spreadsheets
FarPlanner makes it easy to add and update all of the above aspects into your plan. Even with complex plans like the one above, you can quickly see the financial impacts up to 100 years out. This includes an estimate of future inflows, outflows, account balances and net worth. It is easy to pick one aspect like the home purchase and change when will happen in your plan. Within seconds you can update your plan’s forecast to see overall impacts.
Farplanner also estimates tax and inflation impacts on all of your plan’s aspects. See by what dates you could pay down credit cards, and build a cash cushion. See suggested account transfers to consider making now to meet both short and long term plan needs.
FarPlanner is not a budgeting tool but recommends working with one to control your finances. You can still import your banking actual transactions into FarPlanner to gain all the insights above.
Try to do all of that in a spreadsheet! Download and build your complete and complex FarPlanner plan for free today.