Introducing Forecasting: Plan Your Financial Future with Confidence

Stop guessing about retirement, home buying, or career breaks. Monarch Forecasting uses your real data to model what-ifs and help you make financial decisions with confidence.

Catie Hogan

Rachel Lawrence

When will you be able to take a career break? How do you know if you can afford that dream house in three years? Will you have enough money to last your entire lifetime? It’s time to stop guessing or using tools with arbitrary numbers that don’t reflect your real life to find answers to these important questions using financial forecasting.

Introducing Forecasting, a new way in Monarch to discover a confident plan for your future. Your existing Monarch data connects to your forecast automatically and we’ve provided you with some common baseline assumptions, so you can instantly begin drawing insights from a forecast. This is a living plan that you can see, test, and trust — and as your life changes, your forecast will, too.

Why we built Monarch’s Forecasting tool

Finally, a forward-looking view

With Monarch, you can already see where your money is and where it's been. Forecasting shows you where it might be going and how major life events could affect your plan.

Goals help you plan and save toward specific targets. Forecasting connects those targets to each other and to the rest of your financial life, so you can see how they interact over time, especially when they affect each other.

Forecasts in Monarch are modeled projections of your finances across decades. Your initial forecast is built on default assumptions drawn from published financial research, and reviewed by credentialed financial experts with decades of real client experience. Every assumption is adjustable.

Major financial decisions — when to retire, whether you can afford the house, how starting a family will affect your finances — shouldn't require guesswork. Now they don't have to.

How Monarch’s Forecasting tool works

Answers on arrival & as life changes

Monarch’s Forecasting tool incorporates your real life data into long-term projections. You won’t spend time guessing what assumptions to make and if they are even close to ballpark accurate (i.e. income, spending, inflation, return rates, life event timing, etc.). This post will dive into the details of how and why we arrived at our default assumptions, which all come from deeply researched data.

You also won’t have to wonder if all the information plugged into the forecast is stale or outdated – Monarch gives you a living forecast that updates in real-time thanks to your linked accounts. This isn’t a static “moment in time” projection. Whenever something changes in an account you’re currently tracking with Monarch, you’ll see that automatically reflected in your forecast.

Play with your future

Monarch’s Forecasting tool lets you take a peek into what’s possible, with interactive features baked in along the way. While we give you a headstart by making several default assumptions, this tool is meant to be played with. You can tweak any variable and get instant feedback on how it may impact your financial future.

Want to see how changing your retirement age from 65 to 55 might affect the rest of your life? Want to buy a home in five years, but aren’t sure what price to pay? Experiment with different numbers and see how it plays out. Just click and drag to change any assumption or variable and you’ll instantly see it reflected in the forecast. There is no one right or wrong answer here, no single “best” plan for your financial life – just the trade-offs you are comfortable making in order to live the kind of life that fulfills your values.

Monarch’s Forecasting tool is designed to be explored, not perfected. After all, no matter how precisely you plan your future, life changes quickly and often. This tool is meant to help you move in the right direction and give you the info you need to make more confident decisions for yourself along the way.

Key assumptions behind your Forecast

Most forecasting tools demand extensive data entry: from income to expenses, investment growth, and inflation, it then only delivers a snapshot that's outdated in a moment’s notice.

Other tools leave you guessing the second anything shifts. Monarch is built differently, with flexibility and directional accuracy at its core, based on your real aggregated data.

To get you started without hours of setup, we've made some sensible default assumptions. They're designed to give most people a solid, directionally correct foundation. You can always adjust them to see how they shape your forecast. Let's walk through them.

General assumptions

First, there are general assumptions that tell us basic things like how old you are and what your current net worth is. Leaving the general assumptions as they are without any edits would represent a projection of your current financial trajectory, assuming there are no major discrepancies from your real life or big changes over time. Included are the following:

Household members: We will automatically include anyone you’ve added to your Monarch Household as a member, but you can exclude them from the Forecast if you wish by simply unchecking the box next to their name.

Your age: from your own input or else taken from what you told us in your Monarch Household Members settings.

Take home income per year: This is the average of the last 12 complete months of actual household income from your Monarch data. If we don't have 12 months of data for you, we'll take however many months of data we do have and use them to estimate an average year.

Living expenses per year: The average of the last 12 complete months of actual expenses from your Monarch budget are used as a baseline. If we don't have 12 months of data for you, we'll take however many months of data we do have and use them to estimate an average year.

Accounts

Assets: You’ll have a chance to pick which assets you’d like to include in your Forecast while setting it up. All of the financial assets enabled in your Monarch net worth report are included by default, and non-financial assets (cars, homes, etc.) are not. This is because we assume any assets you include in your Forecast could be sold to pay for living expenses during periods when you’re not earning enough income, such as career breaks or retirement. If you wouldn’t sell it to pay for expenses, don’t include it in the Forecast tool.

Liabilities: All debt accounts that are “enabled” in your Monarch Goals Paydown tab are included by default, but you’ll have the chance to include any other debt accounts in your Forecast while setting it up, even if you’re not actively working on paying them down more quickly. Make sure to only include credit cards that you are NOT paying in full every month. We also bring over any info you’ve given us about the interest rates and planned monthly payments (or minimum monthly payments, if planned is blank) for each of the enabled debt accounts. If you update those values in the Paydown tab, we’ll also apply the changes to your forecast unless you manually override those values in your forecasting options.

Current income sources

While setting up your forecast for the first time, we’ll prompt you to tell us your current income sources. We’ll start you off with an estimate of total household take-home income over the past 12 months split evenly between all the members of the household, but be sure to update these figures if they don’t match your reality or remove income sources that you don’t want to rely on for your forecast. Make sure that you’re entering net income only, meaning income after taxes and deductions.