Step-by-Step Guide to Creating Your Financial Plan
Learn how to set up a comprehensive financial plan in the Finance Planner app. Follow these steps to create your calculation, add persons, and plan your expenses, incomes, savings, and loans for a complete financial overview.
The first step in creating your financial plan is to set up a new calculation. This forms the foundation of your planning by defining your planning name and key financial parameters.
The Calculation dialog where you enter your planning details
Give your planning a descriptive name, such as "Retire Early" or "Family Financial Independence". This is the name for the planning that helps you identify different scenarios later.
Enter your current monthly or yearly income. This income is automatically added as an income subject with a timeline from now to your FIRE (Financial Independence Retire Early) age. It represents your active working income.
Enter your total expenses. This expense is automatically added as an expense subject that applies to the complete planning period. It represents your ongoing living costs throughout your financial plan.
Enter the total pension income you expect to receive from retirement age. This is automatically added as an income subject starting at your standard retirement age, representing your passive retirement income.
Set the annual interest rate for your savings. This automatically adds a savings subject with the given interest rate. The savings account will automatically store all income that is left after expenses and will reduce the savings when income is lower than expenses.
💡 Tip: This simplified setup automatically creates the essential subjects (income, expenses, pension, and savings) needed for FIRE planning. The savings account acts as a buffer, accumulating surplus income during working years and providing funds during the gap between early retirement and pension age.
After creating your calculation, you can start planning different financial categories. The recommended order is:
Mortgages are a specific type of expense where the monthly payment is calculated based on the loan amount, interest rate, and repayment schedule. You can also model mortgage interest tax deductions. Here's how to configure a mortgage:
The Mortgage screen showing all configuration options with numbered annotations
Enter the total loan amount at the specified start date. For example, if you're taking out a mortgage of $300,000, enter this amount here. The app will calculate the monthly payments based on this amount, the interest rate, and the repayment scheme.
Set the annual mortgage interest rate as a percentage. This is the interest rate charged by your lender on the loan amount. For example, 3.76% annual interest.
Choose the repayment scheme for your mortgage. There are three options:
Configure the mortgage interest tax deduction (if applicable in your country). Enter the tax deduction rate as a percentage and specify the date until which this deduction is valid. This helps you model tax benefits like the Dutch "hypotheekrenteaftrek" or similar tax advantages in other countries.
💡 Note: Many countries offer tax deductions on mortgage interest to encourage homeownership. Check your local tax regulations to determine if you qualify and what percentage applies to you.
💡 Tip: Mortgage planning is essential for long-term financial planning, as it typically represents one of the largest expenses in a household budget. By modeling different scenarios, you can understand how your mortgage affects your ability to save and retire early.
Expenses are a crucial part of your financial plan. When you plan your expenses, you can see what you need to do to achieve your financial goals. Here's how to configure an expense:
The Expense screen showing all configuration options with numbered annotations
Enter the net expense amount. This option is used for expenses whether they occur regularly or happen just once—like monthly household costs, annual holiday spending, etc. Use the Loan option if you want to calculate costs for a loan like a mortgage, which can also calculate interest deductions (Dutch: hypotheekrenteaftrek).
Set how often the expense is paid. You can choose monthly, quarterly, or yearly expenses. You can also set the occurrence frequency—for example, every 1 or 2 months.
Define when this expense should happen. You can plan future expenses like college fees for your children, or recurring costs like house painting every 5 years. Some expenses will change after you reach your retirement age.
This feature helps you easily link dates to retirement. You can set the date to the fixed retirement date or to an adjustable retirement date using a slider when analyzing your calculation results—for example, to check when you can stop working given all the items you have entered.
Determine if the expense should be indexed for inflation. Most costs are indexed over time, so enable this for most cases. This is important when you want to analyze your calculation with the effect of inflation to get a realistic view of future costs.
After planning your expenses, set up your income sources. Income planning follows similar principles to expense planning:
First, we set up a job income of 3,000 per month. The income is inflation-adjusted and will stop at the early retirement date.
Setting up job income of 3,000 per month, stopping at early retirement
We also set up expenses of 2,000 per month. This gives us a monthly surplus of 1,000 that we can save.
Next, we add a pension of 1,000 per month. The pension starts at the fixed retirement age and is also inflation-adjusted.
Setting up pension income of 1,000 per month, starting at fixed retirement age
When we press Calculate, the first planning results appear. Here we've set the early retirement date to age 65 by clicking the FIRE button.
Calculation results with income, expense, and capital graphs
Looking at the wealth graph, we can see there's a shortage starting in 2049 at age 76. This means we need to plan our savings to cover this gap.
The wealth graph shows a shortage at age 76 in 2049
By clicking on the pink line in the income graph, we can see we have 1,000 to spend monthly until the early retirement date. Let's use this surplus to build savings!
Savings planning helps you understand if you can cover your costs and even retire early. A savings subject is made up of three parts: general settings, deposits, and withdrawals.
The general settings define the basics of your savings account: the opening balance, annual interest rate, and the period during which the account is active. You can also mark it as excluded from wealth tax calculations.
General savings settings: opening balance, interest rate, period, and cover-deficit option
The Use this to cover deficits toggle is a powerful new feature. When enabled, this savings account will automatically be used whenever there is a deficit (i.e. total expenses exceed total income). The deposit amount is also capped at the difference between total income and total expenses, so you never save more than your actual surplus.
In the deposits section you configure how much you put into the savings account, how often, and for which period.
Deposit settings: amount, frequency, period, inflation adjustment, and tax refund rate
The Tax refund rate on deposits is the percentage of each deposit that is returned to your income. For example, if the rate is 20% and you deposit 1,000, you effectively receive 200 back as income—so the net cost of the deposit is 800, but the full 1,000 is saved.
The withdrawals section lets you plan when and how much you take out of the savings account—particularly useful for bridging the gap between early retirement and the start of your pension.
Withdrawal settings: amount, frequency, period, inflation adjustment, and tax rate
The Tax rate on withdrawals is the percentage withheld from each withdrawal. For example, if the rate is 15% and you withdraw 1,000, only 850 is added to your income.
In this example, we set up a complete savings plan using the three parts described above. The annual interest rate is set to 3%. We configure a monthly deposit of 40,000, but thanks to the "Use this to cover deficits" feature, the actual deposit is automatically capped at the difference between total income and total expenses—so you never save more than your actual surplus.
After adding the savings plan, we recalculate. Now the wealth graph shows the shortage has moved from age 76 to age 85 (2058)—a significant improvement!
With savings, the shortage now occurs much later at age 85
Congratulations! You've created your first complete financial plan. From here, you can continue to refine your plan by adjusting savings rates, exploring different retirement ages, or adding additional income sources.
After setting up your financial plan, you can add persons to your calculation. This allows you to model multi-person households and track individual retirement scenarios. Each person can have their own early retirement date that you can adjust to explore different FIRE (Financial Independence, Retire Early) scenarios.
The Person dialog where you enter name and date of birth
💡 Tip: Once a person is added, you can adjust their early retirement date using the FIRE slider in the calculation results. This is particularly useful for couples who want to explore scenarios where one partner retires earlier than the other, or for testing different retirement ages to see their impact on your financial plan.
Once you've entered all your financial data, use the Calculate button to run your analysis:
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