Show Us Your Categories Redux

DannyB
DannyB Superuser ✭✭✭✭
edited September 19 in How do you Simplifi?
A while ago @Flopbot posted about his categories set up and asked us to jump in and share our own. That discussion is now closed, thus the redux!

Recently I listened to a discussion of various ways to organize a budget and one of the ideas was to organize your budget into Fixed and Flexible Spending.  I had never heard anyone suggest this before and it was an "ah ha" moment for me. The "ah ha" was in large part the realization that fixed and flexible is pretty much how Simplifi is set up to function!  The other part of the "ah ha" was a bit of a paradigm shift in how to look at personal budgeting.

That discussion set me on the road to rethinking my budgeting scheme along the lines of Fixed and Flexible spending leading to a newly reorganized budget that is now ready for beta testing in Simplifi. BTW, this reorganizing process was made much easier since I already have fixed expenses listed in Income After Bills and Savings and flexible expenses listed in Planned Spending.

That being said here are my new categories and subcategories:

Fixed Expenses:
A - Comcast
A - Visalia Utilities
A - So Cal Gas
A - [ManhattanLife Medi-gap]
A - [ManhattanLife Medi-gap]
A - Res Com
A - California Water
A - T-Mobile
A - So Cal Edison
B - Visalia Rescue Mission
B - PSWC
B - Valley PBS
B - SACCC - ECC
B - ACC
B - ECC 
B - ECC 
C - Onstar Services
C - Netflix
C - Kindle Unlimited
C - Prime Video - Paramount+
D - Petty Cash
D - Stor It Plaza 1 (daughter's storage)
D - Stor It Plaza 2 (RV storage)
D - Sur Thru 1
D - House Cleaning 1
D - Surf Thru 2
D - Cleaning 2

Flexible Expenses:
Eating Out
Grocery & Household
General Expenses
Other Fun Stuff
Books & Videos
Gasoline

Savings Goals:
A - Auto Replacement
A - G-Kids Accounts
B - Birthdays & Christmas
B - Travel
C - Auto Maintenance
C - Home Upkeep/Repair
C - Surprise & Misc.

Non-Monthly Annual Expenses:
A - Home Insurance
A - Property Tax
B - Auto Insurance
B - Auto Registration
BA - Honda Accord
BB - GMC Canyon
BC - Miro Mini
C - Amazon Prime
C - Costco Membership
D - Apple TV
D - Microsoft 365

Notes:
  1. In this new scheme, my entire budget is captured under ONLY 4 top level categories.
  2. Every item listed under "Fixed Expenses" are currently listed in my Spending Plan under Bills or Subscriptions.
  3. Every item listed under "Flexible Expenses" are currently listed in my Spending Plan under Planned Spending.
  4. I have sorted out my "Fixed Expenses" into 4 groups -  A, B, C, D.  The main reason is for sorting purposes in my spreadsheet model of this reorganization.  The "A" group are "critical" or "non-negotiable" fixed expenses so to speak (Comcast and T-Mobile may or may not belong in this group but I put them there since phone service and internet access are highly desirable for us).  The "B" group are the organizations we donate to. These are "highly desirable" expenses that will remain part of our budget but can be adjusted up or down if desired or and will take a higher priority if we need to cut things out of our budget.  The "C" group are desirable but certainly not necessary and can easily be cut from our spending plan.  The "D" group are pure luxury and would be the first to go if we need to trim our budget.  (I'll let you puzzle out the logic for the A, B, C, D, scheme under Savings goals and Non-monthly categories  :) )
  5. All of the expenses listed under "Non-Monthly Annual Expenses" certainly qualify as Fixed expenses and are sorted along the lines of the groupings used for "Fixed Expenses."  The reason I list them separately is due to the current limitation in Simplifi for rmonth-2-month rollover budgeting.  I will create a single Savings Goal to capture what I need from month-2-month to cover these expenses when they come due.  This will simplify how many savings goals I have to keep track of in my spending plan - 8 potential SGs will become 1 SG
  6. There are only 2 items listed under "Savings Goals" that I would consider true savings goals - Auto Replacement and G-Kids Accounts. The other expenses listed here could be included under "Flexible Expenses." Two reasons I list them here - first, the lack of rollover functionality in the Spending Plan, second, for these expenses the amounts don't reset every month but will carry over from month-2-month and create a pool of funds to spend when/if needed.  Some of these will have an upper limit that once reached I'll stop contributing to the goal until some of the funds are spent and then I'll replenish them, i.e. "Auto Maintenance/Repair," and other's, i.e. "Birthdays & Christmas," have an upper limit for the year but reset for each new year.  If/when rollover functionality is added to the Spending Plan I will move some of these back to the "Flexible Expenses" category.
Benefits:
  1. This way of organizing fits well with how Simplifi is set up to work as @Coach Nicole le points out here.
  2. It's a personal "hardwiring" thing.  We human beings are wired to come at the world in different ways. This way of organizing my budget just works and feels better for me.
  3. This way of organizing gives me a much cleaner view of my bottom line and a clear view of ahead.
  4. The way I have organized my budget up until now seems more conducive to tracking and analyzing spending whereas this new way (new for me) seems more conducive to planning ahead.
Danny 
Simplifi user since 01/22
 Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer

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