An example of VeriPlan's 9-HUMAN CAPITAL graphic

VeriPlan's 9-HUMAN CAPITAL graphic: Gross and Net Human Capital (real $/yr)

Below is an example of the blue-tabbed 9-HUMAN CAPITAL graphic, which comes from VeriPlan's "Sue and Sam Saver" tutorial. This graphic shows Sue and Sam's projected gross and net human capital prior to their retirement.

You can download a free copy of this VeriPlan tutorial file using this link:

Download the Free VeriPlan Tutorial Now

This 9-HUMAN CAPITAL graphic projects the cumulative remaining gross and net human capital for Earners #1 and #2 up until the retirement age of Earner #1.

Human capital is a depletable personal asset. Without substantial inherited assets, gifts, or lottery winnings, human capital is the only asset one has. It must converted into earned income to pay ongoing expenses. Some of it must be saved and converted into valuable assets, if one is to have assets to live on after human capital is gone.

VeriPlan measures your gross human capital as your cumulative yet-to-be-earned real dollar income prior to retirement. Your gross human capital depends upon your entries and growth rates on the yellow-tabbed '2-Your Earned Income' and '4-Your Other Income' worksheets. These entries are related: a) to your wage and salary income, b) to your actively-managed business income, and c) to your other income sources, which may or may not be associated with active income generating efforts on your part.

You can spend and/or save your gross human capital. To the extent that you save it rather than spend it, you will have projected net human capital. Your projected net human capital is your cumulative yet-to-be-saved real dollar net earned income or savings after expenses prior to retirement. Your net human capital can be converted into other assets, which can increase in value and be withdrawn in the future to fund expense shortfalls.