Getting Started: Expenses
Expenses have a big impact on a financial plan. Rather than use high level assumptions for spending, we want to build a "bottoms up" estimate using common spending categories.
Create an estimate of your current monthly expenses in the column called "Current Expenses" and an estimate of your monthly retirement expenses in the column called "Retirement Expenses".
Drop Downs:
- /A = Per Annum
- /SM = Per Semi-Annum (2x per year)
- /Q = Per Quarter
- /M = Per Month
- /SM = Per Semi-Month (2x per month)
- /BW = Per Bi-Weekly
- /W = Per Weekly
Expense Categories
Expenses must be added in four categories (and one optional category for rental property owners):
- Housing Expenses
- Transportation Expenses
- Personal Expenses
- Savings/Debt Payments
- Optional: Rental Property Expenses
Big Change In Expenses? Add A New Expenses Snapshot
You can also add an additional expenses snapshots for any other large changes in monthly expenses. It's possible to add 3, 4, or 5+ expenses snapshots to capture large changes in expenses. Once you have more than 3 expenses snapshots you will need to scroll horizontally using the arrows to see the additional expenses snapshots.
Possible Examples of Additional Expenses Snapshots:
- Pre-Retirement: When adult children leave home
- Late Retirement: A period later in retirement when certain expenses may decrease
Infrequent Expenses Estimate
The infrequent expenses estimate is for home owners or vehicle owners to help anticipate expenses that may only happen every few years. This includes home repairs/maintenance, vehicle replacement, and vehicle repairs/maintenance.
With a few inputs we can create a reasonable estimate for future expenses. The goal is to save monthly for these infrequent expenses. These amounts should be added to the Monthly Housing Expenses or the Monthly Transportation Expenses.
If you do not own a home or own a vehicle these options may be missing. If you feel this is an error please review your Profile settings to ensure you've indicated that you own a home and/or that you own a vehicle.
