What amount do you use in your Spending Plan for “Variable Bills”?

Flopbot

While I understand there is probably no right answer here, I’m curious if there’s a general consensus.

For me, there are three (3) truly variable expenses in my Bills section of Simplifi's Spending Plan…

• Electrical = Lowest $52.00 / Highest $171.11
• Natural Gas = Lowest $38.50 / Highest $262.25
• Water & Trash = Lowest $132.08 / Highest $157.72

This is the amount I have "budgeted" for them in the Recurring Series…

• Electrical = $100
• Natural Gas = $200
• Water & Trash = $150
• Totaling = $450

This is my TOTAL historical spending for these three (3) expenses over the previous 12 months…

• January = $405.52
  
• February = $498.22
• March = $462.54
• April = $379.87
• May = $375.55
• June = $297.02
• July = $272.07
• August = $354.73
• September = $285.62
• October = $288.98
• November = $242.91
• December = $340.23
  
  

My budgeted amount for my three (3) variable bills total $450.  My reasoning for choosing this number is twofold:

1. There's not enough income to simply use the highest amount for the budgeted amount in the Recurring Series; I needed the extra $50 elsewhere in my budget.
2. At $450, this number will cover at least 10 of the 12 months.  In months when my actual spending is LESS than $450, I’ll happily put the money toward other categories.  In months when my actual spending is MORE than $450, I’ll have to make it work somehow by spending less in other categories.

What are some other approaches?

Wooloomooloo2

This is one of those occasions where the Quicken annual budgeting view is really nice, because you can quickly bash in the budgeted amount per month, and it's autofilled based on the prior year to help (at least on the Mac).

For Simplifi it seems your approach is a good compromise. Two alternatives I can think of are: 1) creating 3 separate seasonal spending plans to represent the high, middle and low estimates at different parts of the year and have them as savings goals rather than set bill reminders. The other is to just update the item each month as soon as the prior bill is paid.

DannyB

Now that we access to the next 12 months Spending Plans and you already have your historical seasonal data, would it make sense to input the variables in the appropriate month and make the other adjustments as needed in each month's spending plan?

JamesDiGioia

My approach is to pick numbers that are going to be around but likely over the actual bill. I'd rather have that money budgeted and then have it available than overspend, so that's been working for me in general, both in Simplifi as well as past budgeting apps I've used. I think the way you're approaching it looks good.

Flopbot

@DannyB, that’s a good idea I hadn’t really thought about.  Now that we have the ability to access the next 12 months of Spending Plans, in practice, I really only find myself going one month out into the future to adjust bills as they come in.  Call me lazy, but I just find it too time intensive to scroll back and forth between individual months.  If I get confused about what June is set to and need to reference it while viewing December, I have to click the back arrow six times to view June.  And each month, there’s a new month to adjust.

I’m looking for the most automated / least time consuming process so I guess I’m holding out for Simplifi to implement these two tweaks:

1. Enter Spending Plan in Table View (click here) as @Wooloomooloo2 referenced…good feedback Wooloo.
2. Auto adjust variable bills based on time of year (click here).

With #2, the Spending Plan would be functionally and completely automated and with #1, the data would all appear on one page for easy reference.  I’m confident that Simplifi will eventually implement something like this…someday.

Till then, I’m going to try my $450 approach for awhile (just started it this month) and if it doesn’t work, I’ll implement your 12 month suggestion, Danny.

Thank you both for awesome feedback.

Coach Natalie

I personally take the approach of @JamesDiGioia and select amounts that are around, but always more than the anticipated bill. I prefer to make sure that money is budgeted, even if it's a little bit over, so I don't use it elsewhere. 

My main variable bills are power (higher during the summer) and gas (higher during the winter). When I start to notice that the gas bill is getting up there and the power bill is lowering, or vice versa, I'll go edit the actual Recurring Series amounts to make it more appropriate for the time of year. I end up only editing the Recurring Series' twice per year, and always end up having enough budgeted for these items in the Spending Plan using this method.

DannyB

Hi all!  Do any of you use the biller connect feature that is available in Simplifi? We have solar so our electric bill is just the monthly fee our electric utility charges to access the grid and that’s the same month-2-month. Natural gas and water are our two variables and with the water restrictions in our area due to many years of drought, that bill doesn’t vary by much through the year… not enough to be a problem for planning purposes.  Like you, Chris, @Flopbot , my nat gas will swing from $15 in the summer to $150s in the winter for a couple of months.  I have nat gas and water set to at an average for the year in my recurring bills for them.  I also have connect to these billers in Simplify so when a new bill is posted, Simplifi updates that months recurring reminder to the actual amount due.  I don’t pay more than passing attention to these bills since we have enough surplus available in any given month to make up the difference when the bill is higher than average.  In the past I had to do what you do now, Chris, and make adjustments in other areas when seasonal highs rolled around.