Where do I enter income during retirement?
Are you trying to model earning additional income from a part-time job or side hustle during retirement? Or are you looking at how distributions from your investment accounts work in retirement? We’ll walk through both options.
Part-time job in retirement
Let’s say you have a part-time job where you work 10 hours per week and earn $50 per hour. To add it to your plan:
- Open your Plan and scroll below the graph.
- Hover over Income and click the + button to add income.
- Choose New Income and select the type: Salary, Hourly Wage, Side Hustle, etc. For this example, choose Hourly Wage, then enter your Hourly Rate and Hours Per Week.
- Click Time Range and set a Start and End. You can start at Retirement (as defined in your Plan) or choose a specific month and year.
Note
Your end date must be after your start date. If it isn’t, you’ll see a message like “Must be >= start year.”
Once added, your income will appear as an icon on the Plan graph at both the start and end dates. Click either icon, or scroll down to Income, to make changes.
Investment distributions in retirement
ProjectionLab computes withdrawals from your investment accounts automatically based on everything in your Plan: income, expenses, asset purchases, asset sales, taxes, and more. In most cases, drawdown amounts are not something you need to define manually.
You may also want to add a change in living expenses when you reach retirement, or an additional expense you didn’t have before retirement, such as Medicare.
To explore your drawdown in detail, open a Plan, click Optimize, then click Drawdown. The graph shows a bar chart by year and age. Hover over any bar to see:
- Amount withdrawn and from which account type
- Total dollar amount withdrawn
- Withdrawal rate
- Net worth and liquid net worth
Note
The default view shows Withdrawals. Use the dropdown near the top left of the graph to switch between Net Worth, Income & Taxes, and other views.
Click Drawdown Order to see the sequence in which ProjectionLab will draw from your accounts, based on the assets you’ve added to your Plan. This section can get quite advanced – you can read more in the Taxes category in the Help Center.
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