When you set up your Savings and Spending Budget, you set high-level saving and spending goals for each of your budget groups based on your gross income. However, if you only track net income in Money, your budget will be inaccurate. The numbers in the Planned column of the Working budget page will be based on your gross while the numbers in your Actual column will be based on net. For example, you can plan to contribute $500 per month to retirement, but if you have that money taken out of your paycheck automatically and only track your net pay, you will not be able to see in Money that you've met your $500 goal every month.
The budget works best when you set up Money to track gross pay, including contributions to retirement, taxes and other items. However, you can adjust your savings and spending goals in the budget for net if you want.
For example, Pat plans to contribute a total of $500.00 to retirement, 10% of her gross income. $300.00 per month is automatically taken out of her paycheck before taxes. In addition, Pat sets aside $200.00 per month from her net pay to put into an IRA. If Pat plans to use the Savings and Spending budget but will track only her net pay, she will enter $200 in her Retirement budget group. Her overall goal is still $500.00, but since $300.00 is being contributed automatically, she does not need to track it in Money.
Next, adjust your Savings and Debt budget group, if you need to, using the same steps used for the Retirement budget group. Deduct the amount of any money you have transferred to a savings or investment account that you do not track in Money. If you have money deposited directly into a savings account that you do track in Money, then it is considered part of your net income and you should not deduct that amount.
Depending on your financial situation, the percentages that Money will automatically calculate for your planned amounts based on net may or may not be close to the planned amounts that you set up based on gross. For example, Committed Expenses that represent 60% of your gross income may, upon adjustment, be 70% or more of your net income.
The exact percentages are not important as long as the amounts that you set up for each budget group are realistic amounts that you plan to save, spend, and track in Money.