Cash Surpluses and Cash Deficits

Surplus Cash and Accumulated Surplus Cash

When it does a projection, MasterPlan adds up all sources of cash flow, subtracts all loan payments, living expenses, income taxes, FICA and Medicare taxes, and investments. If there is a surplus or shortage, it lists this figure as positive or negative surplus cash. MasterPlan also totals the surplus or shortage year by year and includes this running total on the overview reports.

What If I Don’t Want to Be Very Detailed?

OK. With MasterPlan, you can be as sketchy or as detailed as you want to be. Read on.

Living Expenses vs. a Detailed Budget and Surplus Cash:

MasterPlan automatically picks up all cash flow items from the assets and liabilities and adds them to any corresponding items that you have entered on the Tax and Cash Flow Form.

MasterPlan is so flexible that provides three different ways to handling living expenses or cash flow items that are not carried on the asset and liability windows:

1. Enter a month-by-month detailed budget for the first projection year on the Living Expenses Budget Tab. MasterPlan will total these annual expenses and carry them forward to the Living Expenses Row on the Cash Flow Tab in Column 1. Press F6 to escalate this figure into the future at whatever inflation rate you choose. Or change the rate from year to year.

2. Enter the annual total of expenses on the Living Expenses Row on the Cash Flow Tab and ignore the Living Expenses Budget Tab. Press F6 to escalate this figure into the future at whatever inflation rate you choose. Or change the rate from year to year.

3. Still too detailed for you? On the Client window, Projection Assumptions Tab, tell MasterPlan to Zero Surplus Cash. Skip the Living Expenses and Budget entries. As it projects year by year, MasterPlan will create a line item on the projection reports called Untracked Living Expenses. Untracked Living Expenses is the total cash flow minus all out-go that you have entered on MasterPlan.

You also can combine methods 1 or 2 with method 3. For example, your clients might be able to tell you where some of their money is going, but not where all of it is going. All they know is at the end of the year, they don’t have anything left over. For this client, enter the expenses that you know about, but still tell MasterPlan to Zero Surplus Cash.