Entering loans, interest, and loan payments

Loan entries are money you've received that you'll need to pay back to the lender. When you enter a loan, you'll specify your loan's interest percentage and length, and LivePlan will calculate the interest and payments automatically. The app also incorporates the correct principal and interest payments into your financial statements.

Note: Don't enter your loan payments as a separate expense. LivePlan adds them to the forecast for you.

Adding a new or future loan

Use this method for loans you'll place anytime after the start date of your forecast.

  1. Click on the Forecast section and select Financing:
    forecast section financing highlighted.png
  2. Click the Add Loan button, located below the Financing table:
    financing add loan.png
  3. Enter a name for the loan, and select the month in which you'll receive it:
    financing section loan entry detail.png
  4. Enter the amount of the loan, the interest rate, and the length of the loan:
    finance add loan detail amount and terms.png
    If the interest rate changes over time, you can input different rates for each month (monthly detail) or each year (annual detail). See Managing variable interest rates below for more details.
  5. Click Create & Exit. The loan will appear in the Financing table under Amount received. You'll see the monthly payment Payments and the balance of your debt for this loan under Balance
    Financing table expanded in forecast.png
    Click on the arrow to the left of any forecast item for an expanded breakdown of principal and interest payments.

Adding a pre-existing loan

Pre-existing loans are loans you receive before the start of your forecast. The steps for a pre-existing loan differ slightly from those for a future loan. 

  1. Click on the Forecast tab, and then click Financing:
    forecast section financing highlighted.png
  2. Click the Add Loan button, located below the Financing table:
    financing add loan.png
  3. Enter a name for the loan, and select Before plan start date under When will you receive it:
    Add loan before plan start date highlighted.png

  4. Enter the amount you still owe on this loan as of the start date of your plan:
    add loan before start date detail existing balance amount .png

  5. Indicate how many payments you have left to make before this loan is paid off:
    add loan before start date detail payments remaining.png

  6. Finally, select Constant rate if the interest rate will remain constant throughout your forecast. If the interest rate will vary, select Variable rate. Enter the interest rate(s) for this loan:
    add loan before start date interest rate.png

  7. Click Create & Exit. This loan and its payments will appear in the Financing table with the same organization as the new loan described above.
    create and exit.png

    If you own an up-and-running business, you'll need to provide your total asset, liability, and equity balances as of the start of your LivePlan forecast. Please see Entering starting balances for an existing company for more details.

Adding a loan with a custom payment schedule

If you need to represent a loan that doesn't match the standard repayment schedule, please see Entering a loan with a custom payment schedule. 

Adding special types of loans

Sometimes, your loan will have special terms. The links below offer instructions for some common types of specialty loans:

Managing variable interest rates

In some cases, the interest rate on a loan can change over time due to refinancing or adjustable-rate loans. LivePlan allows you to represent these varying interest rates within your financial forecast.

  • Follow the steps under Adding a New or Future Loan or Adding a Pre-Existing Loan to enter the initial details of your loan.
  • If your forecast uses monthly detail, input the annual percentage rate (APR) for each month. Use the Apply values right button to automatically apply the interest rate from the currently selected month to all future periods in your forecast:
    apply values right interest.gif

Example: In the screenshot below, the plan starts in March 2024, and the loan is received in May 2025. The initial interest rate of 0.9% is set for May 2025 through February 2026. At the start of FY2027 (March 2026), the rate changes to 4.9%.
variable interest rate instructions collapsed.png

By managing variable interest rates within LivePlan, you can create a more accurate and flexible financial forecast, reflecting the true cost of your loans over time. LivePlan automatically adjusts the interest expense and principal payments based on the interest rates entered. 

Viewing the payment schedule of a loan

To expand the payment schedule of a loan, click on the triangle to the left of Financing:

expand financing arrow.png

This will show additional detail for all financing entries, including the principal and interest breakdowns.

finance entries expanded.png

Clicking on the arrow again will collapse all financing entries into the condensed view.

Where does this entry appear in the financial statements?

(For more details, see How LivePlan handles loans and other financing.)

Only the interest portion will appear in your Profit and Loss table when you enter a Loan or an Other entry. This is because the interest is the only actual cost your business incurs in the loan:

p&l interest expense highlighted.png

Loans will appear on one or two lines of the Balance Sheet, depending on their length. A loan that will be paid back within 12 months appears as Short-Term Debt. A loan of longer than 12 months will be divided into Short-Term Debt and Long-Term Debt. For more on this, read What is the difference between short-term debt and long-term debt?

balance sheet with debt highlighted.png

In the Cash Flow, similarly, loans (or portions of loans) may be considered Short-Term Debt or Long-Term Debt:

Cash flow debt highlighted.png

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