How to categorize self-escrow?

EricG301

My property taxes are not in escrow, but every month I transfer that amount into a HYSA. So at the end of the year, I pay those taxes out of that account.

How should I categorize these transactions?

I could 1) create a new "bill" for monthly property taxes and link it to that — which means when I actually pay the tax, I will "ignore" that transaction to not double count it.

or 2) Create it as a savings goal (categorized as a transfer, correct?) and then only have one "property tax" transaction at the end of the year when I actually pay it?

3) Something else I'm missing?

Coach Natalie

@EricG301, thanks for posting your inquiry to the Community!

I'd suggest going the Savings Goal route and then ignoring the transaction from the Spending Plan at the time it takes place since you already "saved up" the money.

https://community.simplifimoney.com/discussion/3446/tiptuesday-using-savings-goals-to-break-down-annual-bi-annual-expenses-in-the-spending-plan

You can also do something along the same lines with the transfers to savings — you can categorize these as an expense and then ignore the actual transaction when it takes place so it's not counted against you again. This would ultimately give you a monthly amount against your budget just like the Savings Goal would.

Let us know what works for you!

-Coach Natalie