Working with Planned Spending Rollover: An Experiment

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DannyB
DannyB Superuser ✭✭✭✭✭

This is my attempt to set up what I call my non-monthly flexible expenses as a monthly planned spending rollover category. Here is how I am setting this up:

  • I include annual flexible spending amounts for auto maintenance/repairs, home maintenance/repairs, birthday & holiday gifts and healthcare providers/pharmacy.
  • Each of these are set up as a subcategory under the appropriate top category.
  • I created a new top category: "Annual Flexible Expenses."
  • I moved each of the subcategories from the various top categories to my new Annual Flexible Expenses category.
  • This gives me the means to capture spending in these various non-monthly and variable spending categories under a Planned Spending bucket, "Annual Flexible Spending."

Up until now I have used a Savings goal to set aside the money I plan to spend for these various flexible expenses on a monthly basis. In turn, whenever I spent money on one of expenses, I have excluded the expense from my spending plan and made a withdraw to spend on goal from the SG.

Therefore:

  • I withdrew the balance of my annual flexible spending savings funds from the SG and deleted the SG.
  • I created a new Planned Spending bucket I'm calling "Annual Flexible Expenses."
  • I assigned the newly created category "Annual Flexible Expenses" which includes all my annual flexible subcategories to this new Planned Spending bucket.
  • I set the Monthly amount to the same amount as my monthly SG contribution.
  • I set the Opening rollover to the amount I had in the Savings Goal as of date of bucket creation.

Since some of my monthly recurring expenses are categorized with the same subcategories I'm now using for my new Annual Flexible Expenses Planned Spending bucket, I created new subcategories for the monthly recurring billed expenses so they don't get double counted in my new Planned Spending bucket.

I'm not sure how this will pan out, but I'll provide updates in the coming months to share any issues, any adjustments, and any additions.

What I hope this will provide is a means to streamline how I handle these non-monthly but necessary flexible expenses by eliminating the need to exclude these expenses from my spending plan and then having to make contributions to and withdraws from a Saving Goal.

Another potential benefit will be a better and .ore accurate accounting of other funds available and actual expenses. I won't have to remember to do the exclusion and withdrawal.

Danny
Simplifi user since 01/22
Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer

Comments

  • RobWilk
    RobWilk Superuser ✭✭✭✭✭
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    Thanks for trying and sharing, @DannyB


    Rob Wilkens

  • DannyB
    DannyB Superuser ✭✭✭✭✭
    edited March 25
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    Update

    I have now set up a Planned Spending rollover bucket for my annual fixed expenses following the same process as outlined above using a new parent category for annual fixed expenses and moved the fixed expense sub-categories into this new parent category and in addition I:

    • I went through my list of recurring expenses and deleted all the annual/semi-annual recurring expenses. These included such things as annual subscriptions, annual insurance premiums, property tax, etc.
    • Removing annual/semi-annual expenses from my recurring bills/subscriptions is not an issue because:
      • I have these expenses set up for auto pay out of the account in which I hold these funds.
      • I receive notifications from my bank and from the billers for these expenses in a timely manner so I can double check the funds to pay are available.
    • By deleting these expenses from recurring bills/subscriptions, when they are paid, they will now show up in the Annual Fixed Expense bucket in Planned Spending and hopefully the roll over will show the accumulating funds for these expenses in the months they come due.buried?
    • I clicked through the next 12 month's Spending Plans to see how my changes panned out. I had a couple of months that were in the red. These were months with annual recurring bills I had missed in my find and delet recurring step. Now all of the next 12 months are in the green.

    As a result of these two changes, I now have only 3 Savings Goals one of which is for our annual travel expenses. Depending on how these changes to planned spending rollover work out I may set up our travel expenses as a rollover bucket also.

    Stay tuned!

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • DannyB
    DannyB Superuser ✭✭✭✭✭
    edited April 2
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    Update

    March is in the books and April has arrived. My two Planned Spending rollover categories now reflect what I have "in reserve" brought forward from previous months in addition to my April targets for each category. I did have expenses paid out in both categories in March that are now part of my visible data in Q-Simplifi whereas before those expenses would have been excluded from the spending plan and handled with Savings Goal funds.

    Based on what I'm seeing to date, I'm now wondering if I may want to go ahead and breakout the various expenses that are reflected in both the Fixed and Flexible categories into separate Planned Spending categories. This would increase the number of Planned Spending categories but would allow my Q-Simplifi Spending Plan to more accurately reflect the hard copy budget worksheet. To do this now would require some work as I tried to sort out just how much is already set aside for each covered expense within the current pool of funds that has been accumulating over time.

    I'll start with going back to my spreadsheet model budget and doing some figuring of what I've got and where it all is, then make the decision.

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • DannyB
    DannyB Superuser ✭✭✭✭✭
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    An Observation

    When I sat down to look into transitioning another SG into a Planned Spending rollover category along the same lines outlined above, I discovered something I hadn't noticed or thought about with the two previous transitions.

    As I was looking at the SG I'm thinking of transitioning, I decided to double check what SG funds are held in which real-world account. So, in the Savings Goal page, I clicked on the "By account" tab and suddenly I became aware that I no longer had an accounting of all of the funds held in various accounts.

    One of the issues with preparing for non-monthly expenses, whether fixed or flexible, is the need to ACTUALLY set aside the real-world cash for those future expenses. With Savings Goals I had to designate which real-world account I was holding the cash in to cover whatever expense I was saving toward. The Savings Goal feature gives me a way to see the amount of funds set aside for SGs in the accounts list AND on the Savings Goal page "By account" tab. Even better, on the "By account tab," I can see specifically how much in each account is designated for each SG and how much cash, if any, is undesignated in any accounts used for SGs.

    When I transitioned some of my SGs to Planned Spending rollover that accounting feature went away leaving me with undesignated amounts in various accounts and using the rollover feature I no longer have a way to see in Q-Simplifi how much and where the cash I am theoretically rolling over is being held.

    This isn't necessarily a problem, but it was nice to see how the funds in various cash accounts had been accounted for and what those funds were set aside for. I'll miss that… hmm, maybe I'll make this a feature request. 🤔😁

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • Jas
    Jas Member ✭✭
    edited April 5
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    Interesting budgeting method. I'll be interested to see how it pans out.

  • DannyB
    DannyB Superuser ✭✭✭✭✭
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    Update 3

    Now that I've had a chance to see how the Planned Spending rollover feature can work, I have converted my Travel SG into a Planned Spending expense category with the monthly SG contribution amount as the expected monthly goal and adding the current balance of the Savings Goal funds as the Opening rollover amount. I have withdrawn the balance from the Travel SG as a withdraw for another purpose and those funds are now free floating and available for future travel expenses.

    A few more observations as I make these transitions:

    • I will continue to use the same cash accounts to sequester the money needed to cover these rollover expenses in the same accounts I used for the SGs.
    • Two sequestering accounts are HYS savings accounts, and the balances of these accounts should equal the amount available from month-to-month including the current months target amount once transfers are complete.
    • These accounts are high interest-bearing accounts which will require me to adjust the monthly target amount by the amount of interest earned each month to keep the interest payments accounted for. This should be equivalent to my practice of adding the interest to the monthly SG contribution.
    • Making these transitions shouldn't affect my overall Spending Plan since all the covered expenses were accounted for via SGs. Moving forward I anticipate these expenses being visible in my Spending Plan and better represented in my expense reports.

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • Max1223
    Max1223 Member ✭✭✭✭
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    Hey thanks for the experiment. Love the updates.

    I have different sub categories under Travel: Hotels, Air fare, Vacation Dining, etc. Are those captured when you put Travel as a sub category under, Annual Flexible Expenses?

  • DannyB
    DannyB Superuser ✭✭✭✭✭
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    Yes, if you use subcategories for these expenses under Travel as the parent category, QS will include them for tracking purposed in your Travel Planned Spending bucket.

    When I set up in Quicken Simplifi, my goal was to be as minimal as possible. I didn't want to get any more granular in my tracking than necessary, at least necessary in my mind. In keeping with that ideal, I don't break out our travel expenses beyond "Travel." I do have an Excelle spreadsheet book where I plan out our trips and this is where I'll do the more detailed budgeting work, but when it comes time to pay for the trip and track it in QS, I categorize all expenses as Travel. I do use tags for further sorting and keeping track of how much we have spent for each travel experience.

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • Max1223
    Max1223 Member ✭✭✭✭
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    Hi @DannyB I'm a little confused, so QS WILL track subcategories of Travel? eg

    • Annual Flexible Spending (Main cat)
      • Travel (subcategory)
        • Airfare (sub of travel)
        • Lodging

    I thought QS only allow one subcategory.

    I use a SS to plan, but I us QS and the sub categories to see what really happened. The QS Reports give me a good account of what I actually did and helps plan forward.

    thanks

  • DannyB
    DannyB Superuser ✭✭✭✭✭
    edited April 12
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    @Max1223

    QS only allows one level of subcategories. I don’t have any subcategories under Travel.

    This is how I’m set up.

    • Annual Flexible Expense
      • Auto Service/Care
      • Gifts
      • Home Maintenance/Repairs
      • Health Providers/Pharmacy

    What I was saying above is that to have subcategories under Travel it will need to be a separate Planned Spending bucket.

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • DannyB
    DannyB Superuser ✭✭✭✭✭
    edited April 26
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    Update 4

    I now have 3 rollover enabled Planned Spending categories: Annual Fixed Expenses, Annual Flexible Expenses, and Travel. Here is the breakdown of what is included in each of these categories.

    • Annual Fixed Expenses
      • Annual Membership/Subscriptions
      • Auto Insurance
      • Auto Registration
      • Property Tax
    • Annual Flexible Expenses
      • Auto Service/Care
      • Birthdays & Christmas
      • Home Maintenance/Repairs
      • Providers/Pharmacy
    • Travel

    Notes:

    • "Annual Flexible Expenses" and "Annual Fixed Expenses" are artificial parent categories with unrelated sub-categories.
    • "Annual Flexible Expenses" are irregular and non-monthly expenses for which I need a pool of funds to draw from these expenses are incurred. These are the types of expenses that Planned Sending is designed for.
    • "Annual Fixed Expenses" are the types of expenses that would typically be accounted for under "Income after bills & savings" as recurring bills. They can easily be handled in Planned Spending as a rollover category. The drawback is that these predictable, fixed expenses will not show up in Cash Flow projections unless or until Q-Simplifi works out a way to include Planned Spending in the projections.
    • "Travel" covers all expenses related to our leisure travel. I don't bother with breaking these expenses down in Simplifi although when we plan a trip, we do have a spreadsheet for all the details of any given trip. I just don't see a need to itemize those expenses in Simplifi.
    • I've thought about and have even done some work toward breaking out these expenses into individual Planned Spending buckets:
      • Pros
        • Each expense can be moved back be to the logical parent category, i.e. Auto Insurance as a child of Auto/Transportation, etc.
        • Detailed visualization of how much is set aside and accumulating toward each expense month by month separately rather than one large pool covering all sub expenses.
        • No changes to the actual process of categorizing the actual expense data.
        • "Cleaner" reports by eliminating the artificial Annual Fixed and Annual Flexible categories.
      • Cons
        • Added complexity to the Planned Spending page due to more Planned Spending categories listed.
        • The work of actually making the change: rethinking my current set up, dividing up the existing pool of funds into the individual categories, reorganizing parent and child categories.

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • DannyB
    DannyB Superuser ✭✭✭✭✭
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    Update 5

    Yesterday (4/30) I made the move to breakout my annual fixed expenses into separate Planned Spending categories with rollover enabled.

    In the process, I was able to assess just how much of the unspent cash in my cash accounts is already spoken for and for what specific expense.

    Some of these expenses have already been paid for 2024 basically using cash set aside in 2023 and the current year monthly rollover will, for the most part, be accumulating for the 2025 expenses.

    All of these "rollovers" are covered by a monthly automatic transfer to an interest-bearing account. This allows me to keep track of what is set aside for these expenses sort of reflecting what QS does with Savings Goals. I will have to do some math to make sure the balance of the holding account matches the sum of these fixed expenses as the rollover amount increases month-to-month, so that will be something to keep an eye on.

    Danny
    Simplifi user since 01/22
    Budget: a mathematical confirmation of your suspicions.” ~A.A. Latimer
  • Max1223
    Max1223 Member ✭✭✭✭
    edited 12:38AM
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    I'm definitely in favor of the Pro's. Again I wish QS would allow multiple selections within a sub category. So I've had to break up a couple of sub categories to allow this to happen. Not a deal breaker but, not ideal!

    I've moved most of what I had in Savings Goals to Planned spending with rollovers. I used Mint this way and having used QS PRE rollover, I find that I prefer the rollover method to track items. The con for me isn't one, as now I can see all my planned expenses in one place, not having to click back and forth from Savings plans to Spending Plans. Yes longer list, but all within a single page.

    Thanks for the updates @DannyB

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