How to Add an Account

 Accounts are used as part of a  Scenario to store money and, optionally, earn a return on the money in the  Account.

You can think of  Accounts as a fancy way of saying “buckets” for holding money.

So, how do you add an  Account? I’m glad you asked.

Step #1

First, log in to your Real Estate Financial Planner™.

Step #2

Click on the link for  Accounts from the drop down menu under Planner™ across the top of the page.

Step #3

From the  Accounts page click on the Add New  Account button.

IMPORTANT NOTE: If you have more  Accounts than your plan limit, you’ll need to delete one or more  Accounts before being able to add a new one.  Premium users have higher limits to the number of  Scenarios,  Accounts,  Properties, and  Rules that they can add.

See Pricing for more details.

Account Inputs

Now that you’ve created a new  Account, there is some basic information you should enter about your  Account so you know how to identify it on  Charts, when you’re modifying things with  Rules.

Name Your Account

You may need to identify this  Account from a list of all your  Accounts so create a new name for your  Account that will make it easily identifiable.

Here are a few examples that might be helpful, but you’re encouraged to use whatever naming strategies make sense for you.

Stock Market Investment Accounts

If you’re going to use an  Account to hold the money that you’re investing in growth stocks you may want to name it “Stock Market – Growth Stocks”. Then, you can set the Yearly Rate of Return for that particular account to model the returns you might expect to see in growth stocks.

If you have a second account that you’re using to invest in index funds, you might name that  Account “Stock Market – Index Fund” and set the Yearly Rate of Return to match what your expectations are for index funds.

You can use  Rules to move money between  Accounts.

Savings Accounts

In some cases, you may choose to model having your reserves and/or your emergency fund in a savings account that has different earning characteristics than a more aggressively invested  Account like one that is invested in stocks.

If so, you may want to name that account “Savings – Emergency Fund” and use  Rules to keep that  Account at a specific level at all times and put the remainder into other, more aggressively invested  Accounts.

Retirement Accounts

Retirement accounts can have specific limitations on them. They may limit how you can contribute to them. They may limit how you can invest them. They may limit when and how much you can withdraw from them. You can create separate  Accounts to model these and name them appropriately.

For example, you might name a retirement account you have as “IRA – Tammy” or “401K – Brian”. Or, maybe you have or will eventually inherit a retirement account. You might name that “Inherited IRA – Dad”.

IMPORTANT NOTE: What you name your  Account has no impact on how the  Account acts. It is up to you to set up your  Rules to accommodate the restrictions on the  Account. In other words, naming an  Account with “IRA” does not restrict what you can do with the  Account in our system. It is up to you to impose that logic with  Rules.

When Do You Want To Add The Account?

You will want to have some  Accounts from the very beginning of your  Scenario and keep them for the entire  Scenario. For example, an emergency fund or savings account.

However, there are some  Accounts that you may want to “show up” in your  Scenario later. For example, you may want your father’s inherited IRA to show up 10 years in the future.

Use Date Opened to tell the Real Estate Financial Planner™ software when this  Account should show up in your  Scenario.

 Default Cash Account

Every  Scenario must have at least one  Account because the Real Estate Financial Planner™ software needs to know where to keep track of money for the  Scenario. You don’t need to worry about it though… every  Scenario automatically has a  Default Cash Account.

The  Default Cash Account is special. It is the only  Account that can have a negative balance. A negative balance means that you need to add money from outside the  Scenario.

The  Default Cash Account, by definition, earns 0% return. Think of it as money under your mattress or in the shoe-box in your closet.

The  Default Cash Account is always included in your  Scenario and cannot be removed. You don’t ever need to create the  Default Cash Account.

Learn more about the  Default Cash Account.

How Much Are You Starting With?

Next, enter in the Opening Balance for the  Account. This is the amount in the  Account on the Date Opened.

How Much Is The Account Earning?

Finally, what is your expected Yearly Rate of Return for the money that you have in the  Account?

This is the compounding rate of return for this  Account for the entire year. By that, I mean that the Real Estate Financial Planner™ software does approximately 1/12th of that return on your monthly balance each month that it does its calculations. The Real Estate Financial Planner™ software actually calculates what the monthly return would need to be to make sure your return is exactly the Yearly Rate of Return that you enter here.

This is the starting Yearly Rate of Return. What if you want to have a variable Yearly Rate of Return, or change the Yearly Rate of Return later in the  Scenario?

You can use  Rules to adjust this Yearly Rate of Return over the course of the  Scenario. For example, using  Rules we can model this return to be a random distribution curve that models the returns you might get in the stock market. Or, say you get a return on a CD for 3 years and then the Yearly Rate of Return changes; you can use  Rules to adjust this Yearly Rate of Return later.

Once you save what you entered above, you have successfully created an  Account.

Best Practices

Here are some additional best practices for setting up  Accounts:

  • Do not use your actual account numbers for naming your  Accounts. While the Real Estate Financial Planner™ software uses banking-level encryption, why add extra risk by putting your real banking account numbers out on the web in an additional spot on the web.
  • Be brief, but descriptive. “My Retirement Account” is OK. “Joe’s Roth 401K” is better. We do try to use the  Account stylized text with icon when referencing an account so you really don’t need to use the word “Account” when naming your  Accounts in the software.
  • Accuracy Matters, But Just To a Point – If you’re actively using these  Accounts in real life the balance of them is going to vary. You’re never going to get the balances of these exactly right. Plus, in most cases the returns you’re getting on them is never going to be exactly what you entered. So, to think that you’re off by a few hundred dollars is going to make a difference is letting your control-freakiness show a little too much (this is coming from one control-freak to another). Heck, for certain folks, you can be off by a a lot more than a few hundred dollars and that would be eaten up by noise in your returns and modeling. So, chillax about accuracy… especially with starting balances. You can always come back later and update the starting balance and re-run it… that’s what you should be doing anyway.
  •  Accounts Are Reusable Across Multiple  Scenarios – While you can choose to use different  Accounts in different  Scenarios you create, in many cases you’ll choose to use the same  Account across multiple  Scenarios.


The following are additional blog posts related to  Accounts for your reading pleasure.

Adding To Scenarios

Want to read other blog posts that relate to adding  Accounts,  Properties,  Rules to  Scenarios? Here are a few blog posts about that.

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