@Exo3 given your categorization granularity of food, wouldn’t it make sense to record foods purchased on vacation rather than considering it a vacation expense? Given that you would also be eating if you weren’t on vacation, not recording it as food hides the cost doesn’t it?
For those who don't "over track" expenses but have a good system, care to share your Group/Categories?
I have a very similar logic and workflow set up.
At the highest level, our Groups are:
- Bills (= your Regular Expenses) for recurring, regular cost expenses
- Living (= your Irregular Expenses) for baseline living that is variable but non-negitionable (i.e groceries)
- Discretionary (= your Discretionary) for all the things we could conceivably cut if dollars are getting tight
- Savings (= your Savings) for our savings goals.
Then we also break out groups that are technically discretionary but important to us:
- Gifting (many categories in this group)
- Connection (things like date night)
- Travel (many categories in this group that dynamically feed from a custom travel cost planner sheet)
We also have a number of personal businesses so we break those out in groups and and categories.
Once of the things that’s important to me is to keep track of the % of disposable income that we save. To that end, I have a sheet that tracks (Income) - (Bills) - (Living) = Disposable. Then I take (Savings) / (Disposable) to keep track of our household savings rate.
This is all organized around where and how we would make financial changes. In the short term, we can squeeze anything in discretionary (including gifting and the other discretionary breakouts). In the medium / longer term we can squeeze living and bills (i.e. move to a cheaper rental, change our phone service, change insurance).
It’s been working relatively well for us to gain clarity on the big picture buckets (=groups) and if we need to make a change, drill down to specific categories.
I have a “Streaming” category under an “Entertainment” group, a group that also contains things like dining out and social activities.
My Bills/Living/Discretionary definitions are the exact same. I never would have expected someone else to be thinking the same as me. Quite cool.
This is quite nice, thank you – snatching a bit for my own.
Always fun to pile on and compare notes like this.
My basic approach is to create groups around the high-level things I want to track, with some consideration of discretionary/non-discretionary. I’ve re-vamped this several times through the years and try to keep it as short and focused as possible. These also map fairly easily to various budgeting methods for occasional comparison analysis (e.g. 60% Solution, Balanced Money Formula, etc.). I’m mainly budgeting for myself; my partner and I each contribute to a shared budget which I keep separately (using many of the same Groups and Categories). My current Groups (alphabetically) are:
- Life & Health
- Personal & Children
Like others have noted, in each Group I create categories which I want to explicitly budget for (envelope style) or where I feel I need to monitor my spending (think about transparency or visibility, and what you really want to keep an eye on). Each category name starts with a Group prefix so I can easily identify which Group it is part of (i.e. in the Transactions list), and for easier sorting (see screen shot below). I found I would get confused which Group a category was in, so the prefix grounds me as I’m working through Transactions. I keep category changes to a minimum, and number things that are unlikely to change first. If there are too many categories in a group I consider breaking things out to another group.
What I often get from these kinds of reviews is that budgeting is very fluid and individual. Do what works best for you and if someone else’s idea sounds interesting plagiarize.
TL;DR, Here’s how I think about some of the groups and categories:
Some Entertainment items could be considered Utility-like (especially services). I view Utilities as non-discretionary where Entertainment is discretionary. For example, U.7 Mobile (cellular) is a Utility not Entertainment. E.1 Activities, Events, Hobbies is my catch all for going to movies, shows, household parties, and personal hobbies. E.2 Media, Services is for video, music, gaming and other “media” related subscriptions and services (think software and subscriptions, not hardware). E.3 Travel/Vacation gets all expenses for a trip or vacation. Each trip is unique enough that I don’t bother trying to project to the next one by analyzing the previous (e.g. camping vs. cruise).
For household non-food items from places like Target, Costco, etc. I use a general F.1 Groceries & Supplies and budget accordingly. If I get something like clothing, electronics, or patio furniture at Costco, that clearly is not household toiletries, dish soap, etc. and belongs in another category so I’ll split that out. For restaurants, if I’m paying a waiter’s tip for sit-down service on a special occasion (date night, birthday, family gathering), then that’s F.3 Dining Out (Special), though occasionally it could also be an E.1 Activities, Events, Hobbies expense (Bowling or Dave & Buster’s anyone?)
I don’t currently own a house, but I do break out Home expenses (the cost of having a place to live or as an asset) from Household (the costs to furnish it, clean the gutters, mow the lawn, buy tools, and I even toss pet care in this group for lack of a better place). My only “Miscellaneous” category lives in Household for when I can’t figure out where else to put a one-off expense. Hm.5 Improvements is for a new kitchen or roof, or any other items that add to or maintain the value of a home (think asset value for tax purposes). Light bulbs, consumables and other non-“fixture” items are H.1 Maintenance items.
Personal & Children gets a bunch of diverse categories. P.2 Personal Care includes things like gym memberships, spa, massage, haircuts. P.7 Reimbursable gets business reimbursable expenses or other things I expect to get paid back for. It is a placeholder category as I don’t ever budget money here.
In Savings, S.4 Down Payment could be for a house, car, or some other major purchase (I can keep track of those details elsewhere), and S.5 Education could be in Personal & Children, but has long term considerations such as 529 savings accounts so I decided to put it under Savings.
I decided to switch to “Transportation” instead of “Auto” or “Car” as a Group. I take a train to work, use Uber and Lyft occasionally, pay for electricity for my electric car, gas for my kids’ cars, parking fees, etc., and don’t need to see all those items broken down in my budget, so I use a generic T.1 Services & Consumables. I have T.5 Vehicle Purchase/Lease, which is the ongoing payment, vs S.4 Down Payment which would be saving up to buy.
For Utilities I want to easily track gas vs. electric (we currently have solar panels and an electric car), which is why I opted for Utilities as a Group with individual utility categories. I have a separate sheet to track and project each utility bill to help with budgeting. I mentioned a personal budget vs. a shared budget; some of my T.1 Services & Consumables is transferred to our shared U.1 Power category to pay the electricity for my car.
I budget on Gross income, and one issue I had to figure out is tracking payroll deductions. I have a payroll sheet that projects and breaks down each paycheck. Health insurance, HSA savings and company match, retirement contributions, commuter passes, even company meal plans, all pass through to a set of split transactions for each paycheck so those can be captured in my budget categories. Income and payroll taxes pass to a tax planning sheet so I can make sure my withholdings will align with my projected income taxes for the year. When I retire (eventually) all these expenses will be direct, so I felt it was important to get used to tracking and planning for them now.
I try to breakout Target/Amazon/Costco as much as possible. I used to just have this huge Amazon spend with no real insight. So I now break it out, for example a 150 bill might be 45 Bryson - Misc (diapers); 25 - Martini (pet food); 60 household; 30 groceries. I don’t get too specific calculating tax, etc. and just round to the closest dollar using the split transaction feature.
How do you categorize a “#1 - Less: qualified retirement contribution” and at the same time “Savings - Self-Employed Ret Contriubtion”? I’m trying to wrap my head around what makes sense. Are the Savings Goals an expense or income?
The #1 - Less Qualified Retirement Contribution is a payroll deduction item and the other one is for a business owner that makes retirement contributions to a SEP or SIMPLE plan.
Hi @hbwilliams22. My wife and I have taken the route of minimizing the categories as much as possible. With that, there are times where I still like to see the details expanded out so we heavily use tags. If you haven’t used tags before, I highly recommend them. They are great for chasing down things quickly to understand a transaction. Something I do to stay consistent with tags conventions is use data validation that references the tags report. That way, I am entering similar tags names as you would for your list of categories! I hope this helps!
Does anyone go ultra-minimal with categories? For example, just discretionary and non-discretionary as two categories of expenses?
I would like to become more minimal, or at least be able to view transactions by “fixed”, “variable”, and “discretionary”. Would be great if you created a report/tab like this @peter @TillerTeam @tillersupport
One thing I am learning is that when my interest in becoming more granular with expenses becomes a priority, I am spending too much time cataloging after the fact. I need to spend more time before-hand building a budget with broader groups that are in line our home’s priorities and then adjust our living to match those. For us, that’s the power in budgeting: a plan that actually works and helps us to make really impactful choices. Otherwise, I can feel really good to have everything amazingly catalogued, but miss the boat living where we mean to.
Yeah, like another level to Groups such as Classification: fixed, variable, discretionary.
So just a question I previously had an amazon, target, and Costco category. While Costco for me was easy to track gas, groceries. Amazon and Target are like these big black holes for spending since you can literally get anything from these stores. I just merged them into Misc. Discretionary spending so I could see how much I was spending that was not a “fixed” expense. If anyone could give me their opinion on separating it back out then truly breaking down those categories, food, clothing, household supplies, etc. I would appreciate it.
I don’t disagree with you. It’s just my personal preference. My reasoning behind it is that when on vacation I do not want to pay attention to what I spend on food and I normally may also order more expensive dishes than I normally would. Also, given higher prices at tourist destinations, my food budget would show that I overspent on food while in reality I may not have had an option to eat for cheaper - say you go to Bermuda and you pay $20 for a regular burger. Same goes for groceries - you go to a grocery store and a bag of chips is $7.
@hfinkelstein Thanks for sharing; your method is very similar to mine. Would you mind sharing your method for tracking your savings with Tiller? I know there’s been a lot of different things shared here over the years, but I’d love to hear how you tackle it. Thanks in advance.
I like your organization and wanted to share with you and others what I did. I created a group and subgroup for each category and then I can create a pivot table from this info. It’s not tough to create new columns in the transactions tab.
Below is a sample of categories and groups I use.
|FUN & ENTERTAINMENT|
|Alcohol (Wine.com)||Subscriptions||Recreation & Fun||Expense|
|Drinks & Weekend Fun||Entertainment||Recreation & Fun||Expense|
|Driving Range & Golf Lessons||Hobbies||Recreation & Fun||Expense|
|Fantasy Ball||Hobbies||Recreation & Fun||Expense|
|Golf Equipment||Hobbies||Recreation & Fun||Expense|
|Green Fees||Hobbies||Recreation & Fun||Expense|
|Hulu||Subscriptions||Recreation & Fun||Expense|
|Internet Related||Subscriptions||Recreation & Fun||Expense|
|Netflix||Subscriptions||Recreation & Fun||Expense|
|Outdoor Activities||Entertainment||Recreation & Fun||Expense|
|Personal Finance||Subscriptions||Recreation & Fun||Expense|
|Print & Web Books/Subscriptions||Entertainment||Recreation & Fun||Expense|
|Crafts & Hobbies||Hobbies||Recreation & Fun||Expense|
|Real Estate||Hobbies||Recreation & Fun||Expense|
|Sports Activities||Entertainment||Recreation & Fun||Expense|
|Sports Cards Related||Hobbies||Recreation & Fun||Expense|
|Spotify||Subscriptions||Recreation & Fun||Expense|
|Internet & Cable||Obligations||Household||Expense|
|Escrow Refund/Shortage||House Related||Household||Expense|
|HELOC Payment & Principal||House Related||Household||Expense|
|HOA Fees||House Related||Household||Expense|
|Home Maintenance||House Related||Household||Expense|
|Mortgage Payment||House Related||Household||Expense|
|Moving & Selling||House Related||Household||Expense|
|Previous Mortgage & Rent||House Related||Household||Expense|
|Property Taxes||House Related||Household||Expense|
Didn’t see anyone post with account numbers built into the group or category names, so thought I’d throw my method into the ring in case someone finds it valuable.
|00 - Mortgage||01 - Housing||Expense|
|05 - Association Fees||01 - Housing||Expense|
|10 - Property Taxes||01 - Housing||Expense|
|15 - Insurance - Home||01 - Housing||Expense|
|20 - Repair - Home||01 - Housing||Expense|
|00 - Gas & Tolls||03 - Transportation||Expense|
|05 - Insurance - Auto||03 - Transportation||Expense|
|10 - Licenses - Auto||03 - Transportation||Expense|
|15 - Repair - Auto||03 - Transportation||Expense|
|20 - Public Transport||03 - Transportation||Expense|
|25 - Rideshare||03 - Transportation||Expense|
|02 - Electricity||02 - Utilities||Expense|
|04 - Natural Gas||02 - Utilities||Expense|
|05 - Internet||02 - Utilities||Expense|
|10 - Phones||02 - Utilities||Expense|
|15 - Streaming||02 - Utilities||Expense|
|20 - News||02 - Utilities||Expense|
|25 - Software||02 - Utilities||Expense|
|00 - Groceries||04 - Living||Expense|
|05 - Target||04 - Living||Expense|
|10 - Amazon||04 - Living||Expense|
|15 - Personal||04 - Living||Expense|
|20 - Home||04 - Living||Expense|
|05 - Medical||05 - Wellness||Expense|
|10 - Insurance - Life||05 - Wellness||Expense|
|10 - Clothing||06 - Discretionary||Expense|
|05 - Food & Drink||06 - Discretionary||Expense|
|25- Entertainment||06 - Discretionary||Expense|
|20 - Kids||06 - Discretionary||Expense|
|30 - Travel||06 - Discretionary||Expense|
|15 - Other Shopping||06 - Discretionary||Expense|
|40- Gift||06 - Discretionary||Expense|
|99 - Cash / ATM||06 - Discretionary||Expense|
|50 - Reimbursable||06 - Discretionary||Expense|
|05 - Paycheck 1||00 - Primary Income||Income|
|10 - Paycheck 2||00 - Primary Income||Income|
|15 - Other Income||00 - Primary Income||Income|
|20 - Interest Income||00 - Primary Income||Income|
|05 - Transfer - CC||Transfer Types||Transfer|
|10 - Transfer - Invest||Transfer Types||Transfer|
The default tiller templates sort ascending by name, so with account numbers, you end up with a financial statement presentation (income at the top, expenses below, and then all your categories are sorted as you’d like to see them, instead of alphabetically by name). I create accounts in
05 increments in case I need to squeeze in some future thing I haven’t thought of. I use the same convention with asset and liabilities as it cleans up the net worth statement nicely too. And, of course, it works swimmingly with pivot tables. fwiw.
@Kathryn Having a masters in accounting and currently working on another masters in finance, I love this “budgeting chart of accounts.” It appeals to my inner nerd. This will serve as a nice model for my own chart of accounts. With that said, I have three comments/questions.
First, why (and how) do you included your husband’s gross salary along with all the pre-AGI (and one post-AGI) deductions in your Tiller budget? Tiller obviously just imports the paycheck that hits your bank account, so for a salaried employee, this would be be your net pay. Does the “Salary and Wage Income” just work for informational purposes, or does it serve some purpose? Or, now that I think about it a bit more, is this section for your own self-employment purposes? (I was assuming earlier that it was for your husband, but this could be for your own self-employed wages so that you could show transfers out of your account to other accounts.)
Second, why have “#1” listed for the “Salary and Wage Income” section, but not for other sections? Just trying to determine the purpose of this numbering system.
Third, what do you think of the numbering system employed by @viachicago towards the bottom of this thread? It seems like this might be helpful with keeping things organized by accounts to allow a personal financial statement presentation as he/she noted in his explanation. I’m trying to think of potential improvements or pitfalls with using such a system for myself.
Very much looking forward to your thoughts. Thanks in advance!