Share Your Simple-yet-effective Categorization System

With 2022 well underway, I am looking to refine my system and reduce the amount of time it takes to catalog. Below is a link to my current Groups and Types. How can I simplify this? Share yours for inspiration!

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Hi @hbwilliams22

I have a recent post very similar to what you describe. Here it is Category & Groups

I added your list to this sheet which others are doing also as it is good to see how each of us tackles the Category and Group decision making.

I look forward to studying your list and making some refinements to my Categories.

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Oh man, @hbwilliams22, that is a lot of categories… :laughing:

We dropped down— from a longer list like yours— to ~30 categories a few years ago:

  • Allowance (Expense / Living): Allowance payments to the kids
  • Amazon (Expense / Living): All Amazon transaction other than kindle, video, other entertainment
  • Cash (Expense / Living): Cash withdrawls… for untracked expenses
  • Clothing (Expense / Discretionary): Costs of owning clothing for kids and adults— includes cleaning…
  • Donations (Expense / Discretionary): Political and charitable donations
  • Eating Out (Expense / Discretionary): Food or drinks purchased for consumption outside the home
  • Education (Expense / Living): Any expenses related to education & learning for the kids (includes school lunch)
  • Estate (Expense / Living): Life & disability insurance, trust expenses, investments
  • Fees (Expense / Living): Any fees
  • Fun (Expense / Discretionary): Hobbies, sports, movies, adventures…
  • Getting Around (Expense / Living): All costs related to getting around that are not Vacation
  • Gifts (Expense / Discretionary): Gifts purchased for others
  • Groceries (Expense / Living): Food from a store— non discretionary… generally…
  • Health (Expense / Living): All health related expenses: medicine, doctors, dentists, insurance, etc…
  • Home (Expense / Living): Expenses to keep the home operating: mortgage, insurance, housekeeping
  • Home Improvements (Expense / Discretionary): Discretionary improvements & additions to the home
  • Pets (Expense / Living): All dog expenses
  • Professional Expenses (Expense / Living): Expenses and investments in career
  • Services (Expense / Living): Non-home-related services like babysitters, haircuts, etc.
  • Supplies (Expense / Living): Non-food necessities needed day to day
  • Taxes (Expense / Living): Tax, tax preparation, and tax-related line items (including refunds)
  • Team Sports (Expense / Living): Expenses related to kids & adults athletic activities
  • Technology (Expense / Discretionary): Hardware & software technology expenses for everyday living (i.e. not photography)
  • Utilities (Expense / Living): Recurring: electricity, water, trash, cable, internet, phones, security, etc…
  • Vacation (Expense / Discretionary): Airfare, lodging, entertainment away from home… but not meals
  • Other Income (Income / Income): Income from other sources like rentals, interest, gifts, etc
  • Salary (Income / Income): Income from work
  • Transfer (Transfer / Transfer): Transfers between accounts

I don’t miss the hyper granularity.

The main thrust is to bucket at the function that an expense serves (e.g. “Getting Around”) rather than the exact modality (e.g. “Car”, “Public Transit”, “Uber”, “Bicycle Expenses” etc)— which doesn’t feel important in the bigger picture.

Hope this helps.

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Awesome, thanks! Are you able to drop into a spreadsheet share a screenshot of your list?

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Sure thing. Just made a copy of it here.

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Awesome, thanks. Quick question. Do you treat investments as Transfers and hide them?

I don’t track investments. Sorry.

At some point I’m going to need to clean mine up as well, I’m currently at 209 categories. Will probably look into using tags if there’s still a perceived “need” to have that many.

Why do you hide amazon expenses?

One of the things I’ve done to help categorize, is use a SuperGroup, so for some I can have three levels (and income/expense), if needed. I have my Paycheck SuperGroup, then I have my incomes and then I have the taxes as expenses.
What I also found useful and this method allows more broader categories, is to use tags. If I want to get into the details, I can just tag a transaction (or category) but if not, I have a more generic category.

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Randy - how difficult was it to recategorize historical transactions? I have over 30,000 entries in Tiller.

That depends on how you have previously organized it. I’ve done the same, ie since 2015, and it takes time, but. I made large usage of auto cat as well as had to rethink the way I categorize things, as previously I had a four tier category system, as well as duplicate categories. I think the largest challenge for me was transitioning from excel to sheets, as they use very different shortcuts. And currently discover doesn’t seem to want to connect, so speaking of which need to post a query about that.

Hey Randy, how do you categorize things like car maintenance or repair? Is that thrown into “Getting around” or something else? What about something like spa or manicure? I don’t see a fitting bucket for things like this other than “Services” which is a Living expense. Thoughts?

Good question, @hbwilliams22. A while back, I decided it wasn’t worth being so granular as to differentiate gas, insurance and maintenance on a car. For me, the line item in my budget is “Getting Around”. They are all costs of getting around… just like an Uber or a bus. At the end of the year, I need to spend a certain amount of my budget to get places and it all rolls up here.

The house is kind of the same way… there are costs associated with maintaining a house— insurance, electricity, house cleaners, minor repairs. I just bundle this all as “House”. I have a separate category called “Home Improvements” for expenses that are more elective— remodels, new large appliances, landscaping (beyond regular lawn mowing), etc.

That said, I am curious about the total cost of owning a car, so I use a tag, “Auto”, for all expenses related to cars. I’m also curious about how much we use ride shares so I have a “RideShare” tag as well.

As for spa and manicure treatments… that is a good question. We do use “Services” and it is a bit of a catchall. I recommend using tags if you want to do some end of year analysis that is more specific.

Hope this helps.
Randy

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A few quick points here, @bltcfo:

  1. I highly recommend using Autocat to deal with that quantity of transactions. It even has some rule-builder features that could help.
  2. When I moved to Tiller, I ported decades of categorized transactions from Quicken and iBank. The migration still took some work to flex into our new categories but I was not going through decades of old transactions.
  3. Since many users who try to start into personal-finance tools are overwhelmed by historic transactions and abandon their efforts, it is usually recommended that one just start in the current month and move forward. I’d consider just categorizing Feb (or Feb & Jan) and going from there…

I’m noticing you said "RE"categorize…? If your transactions are already categorized, you can make short work of things using Find/Replace and also the Category Renamer (you’d have to be a little bit clever).

Randy

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I use the CSV Line Item workflow and the Amazon transactions end up kind of like a transfer. They are washed out with the offsets and replaced by categorized line-item charges. The Amazon category just ends up with a small residual when amounts don’t match up exactly from Amazon’s export.

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Ok that makes sense. Thanks for the detail. So while you are not granular with your Groups and Types, it sounds like you are pretty granular when it comes to Tags. I do like this approach as it keeps the main view leaner but I could see myself getting carried away with Tags too.

As I reply to you, I think of more questions so please do excuse my follow-up.

I see you have a “Clothing” Category but not other shopping other than “Technology”. Why not have a more encompassing “Shopping” Category instead of something as specific as “Clothing”?

And what about subscriptions like Spotify, Netflix, Hulu, a Gym, or Newspaper? Depending on the subscription do you just bundle it in the expense it’s associated to? ie: Spotify - Technology, Netflix - Technology, Gym - Health, Newspaper - …Education?

What about furniture for the home?

Or a new $600 vacuum?

Are property taxes included in “Home” or “Taxes”?

Home repairs considered “Home” too? Repairs being non-discretionary additions or improvements ie, plumber, fixing a broken window etc.

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Ah ok. I remember giving this a try in the past and it wasn’t that great. It only split out the cost and not the item which required me to go in and cross-reference the Amazon account and assign the countless “amazon” charges to the appropriate Groups. Sounds like the integration might have gotten better. I wonder if returns work similarly.

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Does the Amazon workflow require a manual upload each time? Not sure I would do consistently longterm…

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Does the Amazon workflow require a manual upload each time? Not sure I would do consistently longterm…

Yes. Many users run it ~ monthly. I run it every few months.