“Consumption Smoothing” is a coinage only an economist could love. But like it or not, it's something we all do on a routine basis in our short-term economic lives. If we get paid once a month, we try to budget to spend the same amount each week. I.e, we try to maintain a stable living standard per household member.
Uncle Sam provides three tax breaks for clergy, which makes their planning more complicated than for laypeople. This case study points out the four major ways clergy are advantaged by special income-tax, Social Security-tax treatment, retirement account, and housing provisions. The study also indicates how to include each factor in ESPlanner.
So if you are a member of the clergy, this case study can help you use our software.
All personal financial planning questions, from Can I retire early? to When should I take Social Security? to What can happen if I invest in risky assets? boil down to the impact on your living standard.
ESPlanner is the only financial planning program that directly calculates your living standard and helps you achieve the highest living standard that your current and future economic resources can support.
Take the example of Jack and Jill Sprat, a middle-aged couple.
| Basic Profile: Jack is 51, Jill is 49 Their children have already graduated from college. Housing: 25 years remain on their $350,000 mortgage. They pay $2,000 per year in property tax, $1,500 per year in homeowners insurance, and make a $2,255 monthly mortgage payment. Their last payment is due in 2033. Retirement Dates: Jack 65, Jill 63 (year 2023) |
Danilo and Gina Perez live in New York City. They are 30 years old and plan to have a child in five years and retire at 65. They are both busy bees with a typical, but also highly complex economic life. They want to have a stable living standard per household member over time, but don’t know how much to spend each year to make this happen.
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Disclaimer: The suggestions and recommendations provided by Economic Security Planning, Inc.'s software tools and planning services do not constitute financial or investment advice. The creators of Economic Security Planning's software are not certified, registered, authorized, or any other form of financial planners. Economic Security Planning, Inc. is not an investment adviser registered with the U.S. Securities and Exchange Commission or any state securities agency, is not a registered broker-dealer and maintains no other regulatory credentials associated with the management of financial assets. Economic Security Planning, Inc. does not guarantee that the suggestions and recommendations derived from its software tools and planning services will necessarily achieve a secure economic plan. Like any software products, Economic Security Planning, Inc.'s software tools may have errors in its underlying code, and the assumptions about the future that it makes and that users input may prove false. In addition, output from the software tools and planning services may incorporate data obtained from third parties and such data (including any calculations that is based on such data) is provided on an “as is” basis. From time to time the output may contain errors that may be based upon, among other things, human data entry, aggregation and decompilation of data, processing of data through third party calculation engines and other processes that can give rise to errors. The company's financial plans and recommendations, including all of such plans and recommendations provided by its direct planning services, should be viewed as suggestive and informative educational inputs into your financial decision-making. None of our products or services recommend the purchase of specific financial products.
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