To make changes to future debt payments, increasing or decreasing them at some future point in time:
1. First you will need to have an event on the timeline to schedule the debt.
If an event is not already available in the year of the plan that you intend to schedule the step, one can be added by visiting the Time screen and dragging and dropping a new event onto the appropriate year of the plan.
Or if you are already viewing the Debts screen, events can also be added from the Time panel to the right side of the screen. Select the panel’s Event tab and click the New Event button at the bottom of the panel.
2. Next, go to the Debt screen.
3. Open the debt or as you are entering a new debt, click Advanced Settings.
Note - Debt payments are no longer managed separately on the Expenses > Basics screen as was once the case.
4. Select Step Up / Step Down.
5. In the drop-down list at the top pf the panel, select the event at which the step will occur.
6. Tick the attributes you want to step/change at this point in the future. You can use steps to make future changes to the interest rate charged on a debt or to make changes to annual or monthly payment amounts.
7. Tick Payment Amount to make future changes to payments. Enter the full adjusted monthly or annual amount of the debt payment.
To keep things consistent, the payment frequency (monthly or annual) will be carried over from the main Debt screen. For example, if when entering the details of the debt you specified a monthly payment amount, your step will be made in a monthly payment amount, not an annual one.
8. There is also a new option to set an annual escalation rate on debt payments. If your clients want to regularly increase their debt payments over time, an escalation of payment amounts can be scheduled.
9. Click OK to close the Steps panel.
The line graph at the bottom of the screen should adjust, showing the change in the trajectory of the future debt payments from this step onward.
10. Click Save or Update to save your changes.
Tip - Another related option, which is available only in AdviserGo, is to schedule onetime overpayments on debts. While steps are used to adjust the amount of regular, future payments on debts, overpayments (in addition to regular payments) and payoffs can be easily scheduled on the One Time Payments tab in AdviserGo. Read more >>