The Gap Analysis Setup tab allows for the quick configuration of a few of the general setup features.

Data Input

Configuration for Spouse

 

   

Including a spouse in the retirement gap illustration is optional and is configured by selecting the desired setting. Note that if a spouse is not considered, both the Spouse and the Spouse Retirement Plan tabs will be disabled (as shown above).

Model for Retirement Income

This selection determines if taxation, and distributions based on a client's taxation, should be taken into account for the client. Click here for a discussion of the Tax Wise Distribution Strategy.

Side Fund / Additional Savings

TRAK will calculate the additional savings needed for a client to meet their retirement goals. Any income distributed in retirement that is above the client's determined need is automatically deposited into the Side Fund account. This "extra" income may occur due to the sale of an asset, excess RMDs, etc.

Interest rate prior to retirement and Interest rate in retirement

The rates of return entered here relate to interest rates the additional savings would earn.

Annually increase additional monthly savings with client's raise

When additional monthly savings are needed to solve a retirement gap, check this box if the monthly savings increases the same month the client's raise occurs.

Tax Tier Inclusion

This prompt is used for the Tax Wise Distribution Strategy. It clarifies the income tax tiers to which the account may be distributed during retirement. The options include:

1.All Tiers: The account may be distributed in all tax tiers.

2.Highest Tax Tier: The account may only be distributed in the highest tax tier.

3.Highest Tax Tiers: The account may only be distributed in the highest (x) tax tiers, where (x) is the value entered in the Tax Inclusion Value prompt (next input).

4.Tax Tiers At or Above Value: The account may be distributed in tax tiers at or above the value entered in Tax Inclusion Value prompt (next input).

5.Lower Tax Tiers: The account is distributed in the lowest (x) tax tiers, where (x) is the value as entered in the Tax Inclusion Value prompt (next input).

6.Tax Tiers At or Below Value: The account may be distributed in tax tiers at or below the value entered in the Tax Inclusion Value prompt (next input).

Tax Inclusion Value

This selection is enabled depending upon the chosen option in the prior prompt (Tax Tier Inclusion) and is the value corresponding to that option.

Restricted Distributions

These options determine if funds distributed from an account can be accessed when a shortfall would otherwise occur. For example:

With retirement savings accounts that have cash balances during retirement, a number of payout methods may be selected that restrict distribution to the account (e.g. "Amortize with Inflation"). If this box is checked,  and there is an income shortfall, TRAK will override the restricted distribution and take money from the account.