Rethinking Annual/Semi-annual Expenses Savings Goal Hack

DannyB

In 2022, I ended up with quite a few Savings Goals to accommodate my non-monthly fixed and flexible expenses that I wanted/needed to account for in my spending plan for the year.

This became a bit unwieldy over the year moving money in and out of the goals and shuffling money around between accounts.  Mostly, this was my fault in being too "creative" in how I set up my goals and where I would keep various funds.

For 2023 I have made these adjustments:

1. I reduced the number of Savigs Goals to 4 instead of the dozen + I ended up with in 2022.  One SG is for what I call "non-monthly fixed expenses" (property tax, auto and property insurance, auto licenses tags, annual subscriptions, etc).  The second SG is for what I call "non-monthly flexible expenses" (home and auto maintenance, repaors, replacement, etc). The third is for our Travel Fund and the fourth is for birthday, anniversary and Christmas gifts.

2. Goals 1, 3, 4 are known amounts that will be expended by years end.  Goal 2 will be a set.running amount that will be replenished whenever used.  This will be a bit tricky to do based on current structure of SGs, but initially I'll likely delete the goal when used and then recreate it for the original amount adding in what was left from previous iteration with monthly contributions to bring the goal back to completion.

3. All SG money's will be held in one account out of which expenses can be paid directly. In the real world we will use our two existing checking accounts with one for our monthly expenses and the other for our non-monthly expenses.  Even this isn't really necessary as I can easily track how much of my balance is set aside via Simplifi's Savings Goal feature.

The idea is to keep the whole process of handling and accounting for non-monthly expenses as simple as possible working with the current structure of Simplifi.

In time I'm trusting the development team will devise and implement an integrated way to accommodate these non-monthly expenses more elegantly but until the, this is the plan.

Note: All expenses covered by SG funds will continue to be marked "Ignored" for the reason noted elsewhere in this forum.

jcwmoore

I am trying something similar this year but with five goals and 2 accounts. I have basically split out the "non-monthly fixed expenses" into an insurance goal and a property tax goal because those are paid in July and December respectively. The "non-monthly flexible expenses" I call the emergency fund. The emergency fund is kept in a savings account with my local bank, because it is local and easy to get to if an emergency happens. The other goals are kept in a credit union savings account that I have access to through my employer but does not have a local branch where I live. Plus it actually pays interest, unlike the local for-profit bank. It's an ACH transfer to get access to that money so it is a little less tempting to spend and access.

Same with you, all expenses with these goals are marked as ignored...

ajbopp

Hi @DannyB

Just a thought, for goal number 2, I wonder if it's really necessary to delete and recreate the goal every time you withdraw from it. I've just restructured my SGs to look a lot like this thanks to your wonderful advice above.

In my case, I also have a SG created to help me handle unpredictable expenses like repairs and such. My thought is that when I withdraw from this goal, I will “withdraw for another purpose,” figuring the actual transaction itself will have all the info I need about what I spent the money for. This way I won't mess up the SG with an ever-growing purple bar.

I haven't tried the process in practice yet, so I may be missing something.

Flopbot

@ajbopp as best I can tell, there is no downside to using the “withdraw for another purpose” button short of there's no purple line - and in my mind, that's a positive. Personally, I use this option 100% of the time.

I hope to post a summary of how I use Savings Goals - which includes my reasoning - in the next week or two.

DannyB

Thanks for the tip, @ajbopp ! I didn't think of that and I'll give it a try. @Flopbot I look forward to reading your summary of how you use SGs.

I wonder if instead of some kind of roll over functionality in the Spending Plan that goes against the whole idea behind the Spending Plan, it would be better to have IN ADDITION TO the monthly focused Spending Plan figure out a seperate modal similar to the current Spending Plan modal but focused annual planning. It would have to allow for moving funding into it besides recurring regular income but that can be handled I'm sure.

ajbopp

@Flopbot and @DannyB, I believe I've found a downside to using “Withdraw for another purpose.” When you do that, the Spending Plan sums your contribution for the month and the amount withdrawn for another purpose, making it look as though you haven't contributed your full amount. Over time this could get very confusing. For the moment I am compensating by tracking contributions and withdrawals in a separate spreadsheet.

A simple Savings Goals Report that tracked contributions and withdrawals would go a long way toward eliminating potential confusion.

DannyB

@ajbopp thanks for the heads up. I haven't actually used the “…another purpose” for goal spending yet.

I am thinking about creating tags for each of my SGs to tag savings goal spending. I'm thinking this way I can do a sort by tag in my tansaction list before the end of the month to make sure I have ignored SG spending for the month.