How MyFinancialFuture works

MyFinancialFuture turns the numbers you enter into a month-by-month projection of your cash flow and net worth, out to the horizon you choose. This page explains what each screen does and — in detail — the exact logic and calculations behind the results, so you can see precisely how every figure is produced. Nothing here is a black box.

The model in one paragraph

At the centre is a single calculation, project(plan), that reads your plan and produces one row for every month from today to the end of your projection. Each row works out your income, the tax withheld, your living expenses, the cash flows of every investment you’ve added, your savings balance, your super balance, and your net worth in both today’s and future dollars. It is a pure, deterministic arithmetic model: the same inputs always produce exactly the same output. There is no randomness and no market simulation — it is a transparent projection of your stated assumptions, not a prediction.

The pages, and the sections within them

1. MyFinances — your inputs

This is the single source of truth for everything the engine calculates. It contains:

• Assumptions — your projection horizon (default 40 years), expected inflation (default 2.5% p.a.) and default annual pay rise (default 3% p.a.).
• About you & goals — your age, whether you’re single or partnered, your target retirement age, risk appetite and goals. Your age and retirement age drive the retirement and lifespan logic below.
• People & income — one or two people, each with salary (which rises each year), plus any other ongoing or one-off income.
• Expenses — living costs by category, entered in today’s dollars.
• Current savings — your liquid cash today, held as cash or in a loan offset.
• Current investments — the property, shares/ETFs, superannuation strategies and cash accounts you already hold or want to model. Each is a configurable module (see the calculations below).

2. MyFinancialFuture — your results

The live projection of the plan above. It shows:

• Net worth over time — charted in nominal (future) dollars or real (today’s) dollars via a toggle.
• Cash flow — money in vs money out, year by year.
• Milestone cards — key moments such as loan pay-off, the month your savings first turn positive, and retirement.
• The monthly ledger — every month in a table, with a column for each investment so you can trace exactly where each dollar comes from. Your residual cash balance is always shown.

3. MyFinancialOpportunities

A rules engine scans your finances for well-understood, generic improvement areas (for example: holding more cash than a sensible buffer, or being heavily concentrated in property). Each opportunity shows an estimated long-run benefit, a Wealth Impact Score, and an editable “how it’s calculated” panel so you can change the assumptions behind the estimate. Opportunities are generic information, not a recommendation that any of them suit you.

4. MyFinancialScenarios

A scenario is your current finances plus a set of strategies you choose to layer on top (e.g. add an investment property, start an ETF plan, salary-sacrifice into super). Each scenario is projected by the same engine and can be compared against your current path so you can see the difference at a glance.

5. AI explanations

MyFinancialOpportunities opens with an AI summary of your top opportunities, and each card has an Explain with AI button. On MyFinancialScenarios, the AI read-out describes a chosen scenario: what it does, its benefits and risks, and who can help. The AI never does the maths. It only explains figures the tool has already calculated, and every dollar amount it writes is checked against those figures before you see it. It is filtered so it never names real products, funds or tickers and never uses advice language. Only the figures it needs are sent, never your names or full plan.

6. Export

Download any scenario’s full month-by-month projection as CSV, XLSX or PDF, or export your entire plan as JSON to re-import later. Every export carries the same general-information disclaimer.

The calculations, step by step

Each month, the engine runs the following in order. All money is held internally as whole cents to avoid rounding drift.

Time & the date spine

Month 0 is today (your plan’s base date). Every value is indexed by month number. Annual events — pay rises, the end-of-financial-year tax reconciliation, and rent reviews — fire on their anniversaries relative to that spine. Growth, return and inflation rates are effective annual rates: 7% a year means a balance grows by exactly 7% over twelve months (each month uses (1 + rate)^(1/12) − 1).

Income

Salary is annualised and grown by your pay-rise rate once per year: salary = starting salary × (1 + pay rise)^(years elapsed). Other ongoing income and one-off amounts are added in the months they apply. Other taxable income (a bonus, business income, rent from outside the plan) is taxed like salary but earns no super. Salary stops at your retirement age; other income continues unless you give it an end date. Cash savings earn interest (default 3% p.a.), which is taxed as income.

Tax — PAYG each month, reconciled each July

Each month, tax is withheld on your salary using the Australian resident income-tax brackets for that financial year (15% on $18,201–$45,000 in 2026–27, falling to 14% from July 2027), the low income tax offset and the Medicare levy (PAYG approximation). From 2026–27 each person with salary gets the $1,000 standard deduction for work-related expenses, so the tax owed is worked out on salary less $1,000 (or less the salary itself if it is under $1,000). Like the ATO’s withholding tables, monthly PAYG doesn’t allow for it, so the saving comes back in the July refund. The planner has no field for actual work expenses, so it always uses the standard amount. HELP debts are indexed each June and repaid from pay at the ATO repayment rates. A couple is taxed person by person, with investment income and deductions split by who owns each asset. On 1 July each year the engine runs a full end-of-financial-year reconciliation:

• It computes the actual tax on your taxable income — that is, assessable income (salary, rent, distributions, capital gains) minus deductions (the standard deduction for work-related expenses, negative gearing on property, debt-recycling interest, etc.).
• It subtracts any franking credits from dividends.
• The difference between that actual tax and what was withheld during the year becomes a refund or bill, applied in the following month’s cash flow.

From 2026–27 most salary earners get a small refund each July from the standard deduction, a few hundred dollars. A larger recurring refund usually means you’re negatively geared (deductions reduce your tax below what PAYG withheld); a recurring bill means investment income on top of salary. If the plan starts part way through a financial year, the months before it are assumed to have had the same pay and the same tax withheld as the plan’s first months. That first July adjustment then covers what the plan added in those months, such as interest, rent, capital gains and deductions, taxed at your full-year rate.

Capital gains

When an asset is sold, the net capital gain is added to that year’s assessable income. If it was held for at least 12 months, the 50% CGT discount applies to the gain first.

Expenses & inflation

You enter expenses in today’s dollars. Each month they’re inflated to future dollars: expense = today’s budget × (1 + inflation)^(month ÷ 12). From retirement onward, total expenses are scaled by your retirement-expenses percentage if you set one.

Superannuation

While you’re working, super grows each month by the fund return plus contributions, after the fund’s 15% contributions tax: balance = balance × (1 + monthly fund return) + salary × SG rate ÷ 12 × 0.85. The Super Guarantee is 12%. Salary sacrifice is taxed the same way going in and reduces your taxable salary. Above $250,000 of income plus contributions, Division 293 adds another 15%. The fund return is taken as net of fees and the fund’s tax on earnings, the way funds report it (default 7% p.a.). In retirement, super pays at least the legislated minimum pension each year (4% under 65, rising with age), more if your spending needs it, and the rest keeps earning. Crucially, you can’t access super before the preservation age of 60: if you retire earlier, super keeps earning but is held untouched until 60, and cash and other investments fund the gap.

Property

• Loan — principal & interest: interest = loan balance × rate ÷ 12, and principal paid = repayment − interest, so the balance amortises to about zero by the end of the term. (Interest-only is also supported.)
• Value — grows at the annual growth rate: value = price × (1 + growth)^(months ÷ 12).
• Buying costs — stamp duty (2026–27 tables for every state and territory, with owner-occupier and first home buyer concessions) and lenders mortgage insurance apply only to a prospective purchase. A property you already own is charged no acquisition cost.
• Rent — weekly rent becomes annual income, less a vacancy allowance. It is reviewed each anniversary to the purchase yield on the current value, so rent grows with the property.
• Deductions — loan interest + property management + insurance + council rates + maintenance + depreciation (building depreciation = 2.5% × construction cost a year for up to 40 years, only when you enter a construction cost). These flow into the EOFY reconciliation as negative gearing.
• Usable equity — 0.8 × value − loan balance.
• Buying a home to live in — when you model an owner-occupied purchase, your Rent expense automatically stops from the purchase month (you own, so you no longer rent); the mortgage and ownership costs are modelled on the property instead.

Defaults: 20% deposit, 30-year term, 6.5% interest, 4% capital growth, ~3% rental yield, NSW — all editable per property.

Shares / ETFs & debt recycling

• Contributions — a regular dollar-cost-averaging amount over a window you choose.
• Growth — the holding compounds at its capital-growth rate, reduced by the fund management fee (MER). The default is 6% capital growth + 4% distributions (≈10% total nominal, the long-run historical broad-equity figure), with a 0.17% MER.
• Distributions — paid out as cash (or reinvested), grossed up for franking: franking gross-up = distribution × franked % × 30 ÷ 70. The franking credit then offsets tax at the EOFY reconciliation.
• Debt recycling — linked to your home loan, each month’s amount is paid off the home loan and re-borrowed on a split investment loan to invest, so home debt turns into deductible investment debt. The model tracks both loans, the portfolio and the franking credits separately.

Cash & offset accounts

Cash savings and any high-interest or term-deposit account earn interest, which is taxed as income. An offset balance instead reduces the interest charged on its linked loan, rather than earning interest itself.

How retirement is funded

In retirement, expenses are covered in this order:

1. Before preservation age (60): super is off-limits, so cash savings fund expenses, then shares/ETFs you’ve opted in to draw down (each partial sale triggers CGT).
2. From age 60: your tax-free, inflation-indexed super pension is the primary income. If it more than covers expenses, the surplus banks to cash; if it falls short, the gap is met from cash, then drawable ETFs.

If every source is exhausted, your cash balance goes negative — the model’s honest way of showing you’ve run out of money (this is what the Yes/No verdict on your results flags).

Lifespan: where the projection stops

The projection ends at your modelled end-of-life age (100), even if your chosen horizon is longer. This prevents the model from compounding wealth for decades after death — money no living person would ever hold — which would otherwise badly distort the headline net worth. Any super remaining at that point stays counted in net worth so the figure stays continuous to the final month.

Net worth: nominal vs real

Net worth = cash + super + investment values − loan balances. That’s the nominal figure. The real figure restates it in today’s purchasing power: real = nominal ÷ (1 + inflation)^(month ÷ 12). Real net worth is the more honest gauge of whether you’re actually getting wealthier, because it strips out inflation.

Determinism

The whole engine is a pure function with no randomness, no network calls and no hidden state. Re-running the same plan always gives byte-for-byte identical results, and the calculations are validated against fixed “golden” reference figures and property-based tests on every change.

Key default assumptions

Every one of these is editable in your plan. The defaults are starting points, not advice.

What the model deliberately does not do

• No market simulation. Returns are steady annual assumptions, not random or sequence-of-returns scenarios. Use Scenarios to test different rates yourself.
• No Age Pension or Centrelink means-testing, and no aged-care modelling.
• Simplified super rules. Super is held until the preservation age of 60 and then drawn as a tax-free pension (the over-60 account-based pension treatment). The model doesn’t cover transition-to-retirement pensions, the tax on any pension taken between 55 and 59, or death benefit tax.
• Approximate, point-in-time tax and state rules. Brackets, stamp duty and similar are based on published rates and may lag legislative change.
• No product recommendations. It models generic, configurable building blocks — never a specific fund, lender, share or super product.

For how the maths is tested and where the figures come from, see How we check the numbers. For more on what the tool is and isn’t, see About, and how your data is handled in our Privacy Policy.