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Joint expenses

I should have specified taxable income. Here’s the gory details:

1.If we have previous year’s taxable incomes for the spouses (sum of the two is not 0), we use those to determine the proportion, so that deals will all the income splitting/sharing.

2.If that doesn't work we use the current total incomes of each spouse. That’s before the CPP/taxes calculations, so no pension splitting/sharing is considered in that case.

3.If that doesn’t work we use the net worths of each spouse (previous year, sum of the two is not 0).

4.If that doesn’t work we use 50%.

This is re-calculated for every year in the TIME MACHINE.

#1 usually works although #2 is often applied in the current year if a user doesn’t bother to enter last year’s taxable incomes in the TM preflight input screens. 

#3 and #4 rarely happen.

Joint expenses

Yes,

That’s mostly correct. Joint expenses are attributed proportionally to income so not necessarily 50%. But you got the important point that each spouse pays them from their own accounts (and joint accounts when available).

Read Me First

The MoneyReady App was launched in the summer of 2019. Almost 4 years later, after answering many questions, getting great feedback, and having many discussions with users by email, I decided to start this community forum in March 2023 so that everyone can benefit from these discussions.

Because nobody likes an empty forum, meet user anonymous:
This is a fake user created to populate the forum with real questions that were sent by email to the MoneyReady App. Those emails and our responses have been curated to select the most common, interesting, and still relevant today. They have been edited for clarity and to remove any identifying information for privacy and security. Typos are all mine.

If you recognise your words because you are the original writer of a topic and want proper attribution, let me know so we can fix the attribution.

Welcome to the Money Ready Forum. Looking forward to reading your posts!

Now please go read the Rules before proceeding.

 

Marginal tax rate

A new graph for the marginal tax rate has been added to the TIME MACHINE results.

Marginal tax rate

Well that should tell you there are already too many graphs :)

I nevertheless added the MTR graph if it can be helpful.
Marginal tax rate

Hi,

There is a graph of the average tax rate, and it is calculated exactly as you say.
I do have an MTR on income already calculated. Would you like me to add that graph? 
 
Currencies for REVENUES, INCOMES, EXPENSES, and AUTOMATIC SAVINGS

For REVENUES, INCOMES, EXPENSES, and AUTOMATIC SAVINGS/WITHDRAWALS, you can now specify a currency (previously assumed to be CAD). LOANS, ACCOUNTS, and INVESTMENTS already had that feature.

USD/CAD exchange rate model

A model for the USD/CAD exchange rate was added to the Market model for Monte Carlo simulations.

Saving runs

The first interpretation is correct. If you already have 6 runs saved, it’ll ask which of those you want to delete before allowing you to save your last run.

Interpretation 2 would be cruel! 

I’ll try to clarify for the next edition of the eBook.
Thanks
Income splitting

Yes US social security is eligible pension income so it is splittable, at least the 85% of it that is taxable. See the last item in the table here:

Income splitting

The income splitting only splits private pension income, RRIF/LIF(not IRA) withdrawals after 65, and surprisingly, US Social Security (not CPP), but not income not eligible for splitting. However it splits that eligible income in such a way as to make the resulting total taxable income equal (as much as is possible) for each spouse. Additionally, if you’ve entered a date of cohabitation with your spouse in the CPP tab, the program also does CPP sharing (before any income splitting is applied). You can see if there was any CPP transferred in the Warnings column.

What do your reports look like?

Click to download a sample pdf file

What securities do you update prices for?

For Canada, we cover listings on the Toronto Stock Exchange (TSX), the Canadian Securities Exchange (CSE) and Aequitas/Neo Exchange. For the USA, we cover listings on the New York Stock Exchange (NYSE), the NYSE American exchange, the Nasdaq, and the OTC. We do not cover warrants or options. We do not cover the Chicago Board Options Exchange (CBOE). We cover most series of Canadian mutual funds, segregated funds, hedge funds, and closed-end funds. This market data is provided by Fundata Canada Inc. and updated nightly.

We update regular currencies nightly from the European Central Bank.

We update Cryptocurrencies nightly and on demand using CoinGecko.

For ACCOUNTS, INVESTMENTS and LOANS linked to Wealthica, values are updated from Wealthica on demand.

How long does it take?

In programming, we have a saying, GIGO: Garbage In, Garbage Out. The Money-Ready App is built to provide you with accurate calculations, which requires accurate and complete data. We make it easy, but it can take some time to gather that data. Depending on how complicated your financial situation is, how detailed you want to be, and the depth of your financial knowledge, plan 15 to 45 minutes before your first TIME MACHINE run. Take your time to do it right and your patience will be rewarded. Financial planning is a skill that requires continuous learning and will last you a lifetime. 

Limitations

We endeavour to have accurate calculations for Canadian taxes, rules, and benefits for all Canadian residents, however we cannot always include everything in the various Federal and Provincial legislations.

We endeavour to cover all financial products available to Canadians, however the complexity of some products cannot always be captured completely.

We point out these deficiencies when we know of them.

We do not and cannot guarantee the accuracy of anything in The Money-Ready App.

We are continually improving The Money-Ready App.

We welcome feedback so please suggest features that are not currently implemented.

We will work on implementing the most popular requests first.

How safe are my data? Security Policy.

To develop accurate financial plans the MoneyReady App requires some personal and financial information from you. Nothing is more important to the MoneyReady App than trust and protecting this data. Please see our Security Policy.

How does the MoneyReady App TIME MACHINE work?

The MoneyReady App is not a financial planner itself. It is a calculator that can be used to assess financial plans using its powerful iterative cash-flow engine, the TIME MACHINE. The MoneyReady App can answer even the toughest financial questions by considering a person's current and complete financial position, and future aspirations, fears, and goals. It takes all of the inputs for a financial scenario, and then crunches the cash-flows, and outputs a detailed financial picture calculated for every year. Running the TIME MACHINE is a very empowering exercise for people. They can immediately see the results of any financial decision, recommendation and assumption.
Video explaining the TIME MACHINE (3 minutes).
However, the TIME MACHINE only provides guidelines and ideas for creating a financial plan. It is not designed to predict the future. The results generated by this program are based on user estimates of many factors like rates of return, life expectancy, and inflation and important assumptions such as tax rates and government benefits. The results are only an illustration, and none of the information can be guaranteed.
In crunching the numbers we try to include the latest tax rules and regulations, both federally and for all provinces and territories. We avoid short-cuts and estimates as much as possible. Although accuracy is our aim, we do still need to make some assumptions and approximations, and we have not yet covered the entire Canadian tax code nor all available financial products. The TIME MACHINE does not verify the validity of transactions according to the CRA.
For more information please register and get the free eBook which explains all the features of the MoneyReady App .

What are your investment recommendations?

We do not recommend or sell investments.

Can the MoneyReady App handle families?

Yes. Once logged in, a user can add a spouse to their profile so that the spouse's finances will also be considered. A spouse does not need a separate subscription. Children are only considered for their financial implications on the parent or parents and cannot have accounts or investments (except RESPs and RDSPs), so that adult children would need a separate subscription to the MoneyReady App for their own financial planning. 

What are the features/capabilities of the MoneyReady App?

A summary of all the features of the MoneyReady App can be found on the homepage.

A full description of all the capabilities/features of the MoneyReady App can be found in the eBook (login required)