What percentage of you 2017 income can you account for?

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pondering
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What percentage of you 2017 income can you account for?

Post by pondering » Sat Apr 14, 2018 8:06 am

I just finished our taxes. We need to pay an additional 1800 which was less than 2% of our income.

Does anyone produce a report of where all their money goes for a tax year? What categories do you use?
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Chicago60
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Re: What percentage of you 2017 income can you account for?

Post by Chicago60 » Sat Apr 14, 2018 8:38 am

I simply look at my checkbooks and credit card statements. If I wanted to, I could reply on the credit card statements' annual report which allocates expenses based on different categories of their choosing.

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Kenkat
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Re: What percentage of you 2017 income can you account for?

Post by Kenkat » Sat Apr 14, 2018 8:43 am

I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.

smitcat
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Re: What percentage of you 2017 income can you account for?

Post by smitcat » Sat Apr 14, 2018 1:49 pm

Kenkat wrote:
Sat Apr 14, 2018 8:43 am
I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.
Very similar to us except we use Quickbooks and about twice that 0.7% in misc for our home budget.

deskjockey
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Re: What percentage of you 2017 income can you account for?

Post by deskjockey » Sat Apr 14, 2018 3:38 pm

Kenkat wrote:
Sat Apr 14, 2018 8:43 am
I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.
Same here, too (with Quicken). My miscellaneous category is about 2 to 3%.

earlyout
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Re: What percentage of you 2017 income can you account for?

Post by earlyout » Sat Apr 14, 2018 4:03 pm

Also track expenditures with Quicken. Cash, credit card and check outlay is all entered and categorized. Less than 0.5% in a misc. category.

jebmke
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Re: What percentage of you 2017 income can you account for?

Post by jebmke » Sat Apr 14, 2018 4:09 pm

I track three categories. Capital (large expenditures for things that last a long time - e.g. car), income taxes and everything else (Miscellaneous). So I have very large "miscellaneous" category. "Miscellaneous" is 87% of our spending over the last six years.
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delamer
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Re: What percentage of you 2017 income can you account for?

Post by delamer » Sat Apr 14, 2018 7:10 pm

Kenkat wrote:
Sat Apr 14, 2018 8:43 am
I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.
I am even more anal then Kenkat. :wink:

I have, literally, 99.8% of expenses accounted for via Quicken.

I have categories like auto, food, clothing, mortgages, taxes, healthcare, travel. Within those are subcategories — under auto, for example, there are subcategories for fuel, service, insurance, registration fees.

Income tax refunds or taxes due based on TurboTax calculations are included in the filing year’s income/expenses.

veindoc
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Re: What percentage of you 2017 income can you account for?

Post by veindoc » Sat Apr 14, 2018 7:22 pm

delamer wrote:
Sat Apr 14, 2018 7:10 pm
Kenkat wrote:
Sat Apr 14, 2018 8:43 am
I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.
I am even more anal then Kenkat. :wink:

I have, literally, 99.8% of expenses accounted for via Quicken.

I have categories like auto, food, clothing, mortgages, taxes, healthcare, travel. Within those are subcategories — under auto, for example, there are subcategories for fuel, service, insurance, registration fees.

Income tax refunds or taxes due based on TurboTax calculations are included in the filing year’s income/expenses.
Do you input all your expenses by hand? I would like to track our expenses with that level of detail but mint/personal capital are always fighting with my bank accounts. Or getting them wrong. I have a cc that I have not used in probably 18 months. The balance is zero, but mint says I owe $376 on that cc which was the very last balance I had on that card which was again 18 months ago. I had accounts at two different banks: Bank A and Bank B. B bought A and A converted my account to an account owned by B. So I know have two accounts with B which mint treats as one account. So every time I have a transaction with either of these accounts, mint counts it twice. So it looks like I paid $100 for my cell phone instead of $50. Or sometimes I log into mint only to find that it is inexplicably unable to communicate with a bank that it had been conversing with for months/years with no problems.

I have a lot of transactions and I don’t always keep my receipts which is why I haven’t attempted to track my expenses by hand. I’m not always so diligent about logging into mint to correct all their mistakes.

BuckyBadger
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Re: What percentage of you 2017 income can you account for?

Post by BuckyBadger » Sat Apr 14, 2018 7:59 pm

We don't track anything, really. We put away plenty of money before our paychecks even hit our account and then spend what's left.

I could look back at credit card receipts, but there's really no reason to at this point until we need to increase our cash flow.

So, zero percent i suppose.

Gill
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Re: What percentage of you 2017 income can you account for?

Post by Gill » Sat Apr 14, 2018 8:01 pm

100% using Quicken and have done so since about 1989.
Gill

scottinmet
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Re: What percentage of you 2017 income can you account for?

Post by scottinmet » Sat Apr 14, 2018 8:16 pm

pondering wrote:
Sat Apr 14, 2018 8:06 am
I just finished our taxes. We need to pay an additional 1800 which was less than 2% of our income.

Does anyone produce a report of where all their money goes for a tax year? What categories do you use?
Close to a 100%. I use a spreadsheet and break it down between monthly and non-monthly expenses. Every couple of months I download the data from my bank and credit card companies to put all the charges into my spreadsheet.

Monthly categories I use are:
Groceries
Clothes
Restaurants
Gas
Cable/Cell phone
Utilities (water, sewer, trash)
Electricity
Car
School
Cash

Non monthly categories are:
Auto Insurance
Car Maintenance and tax
Medical
House Repair
Home Insurance and tax
Entertainment/Vacations
Gifts
Donations
Retirement Savings
529 Savings

I have monthly average and yearly totals at the bottom of each category, which are then summed up across the categories.

It doesn't take long for me to input the data, maybe 20 minutes every couple of months. I use three excel tabs per year, one each for the CC and Checking data, and one for total expenditures.

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Kenkat
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Re: What percentage of you 2017 income can you account for?

Post by Kenkat » Sat Apr 14, 2018 9:01 pm

delamer wrote:
Sat Apr 14, 2018 7:10 pm
Kenkat wrote:
Sat Apr 14, 2018 8:43 am
I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.
I am even more anal then Kenkat. :wink:

I have, literally, 99.8% of expenses accounted for via Quicken.

I have categories like auto, food, clothing, mortgages, taxes, healthcare, travel. Within those are subcategories — under auto, for example, there are subcategories for fuel, service, insurance, registration fees.

Income tax refunds or taxes due based on TurboTax calculations are included in the filing year’s income/expenses.
HaHa, I will tell my wife. I think she can’t stand that I get so detailed but she pretends to tolerate it :happy

Mike Scott
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Re: What percentage of you 2017 income can you account for?

Post by Mike Scott » Sat Apr 14, 2018 9:04 pm

100%. It's all gone somewhere.

clutchied
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Re: What percentage of you 2017 income can you account for?

Post by clutchied » Sat Apr 14, 2018 9:05 pm

pondering wrote:
Sat Apr 14, 2018 8:06 am
I just finished our taxes. We need to pay an additional 1800 which was less than 2% of our income.

Does anyone produce a report of where all their money goes for a tax year? What categories do you use?
I don't really use cash so all transactions run through cards of one type or another. We track through Mint and it's a pretty amazing system as it also tries (and does a pretty decent job autocategorizing).

darrvao777
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Re: What percentage of you 2017 income can you account for?

Post by darrvao777 » Sat Apr 14, 2018 9:20 pm

We use round numbers

We try to save 50% of gross for investments and real estate

Effective tax rate was 35%

Spent the remaining 15% (and/or it’s still in my checking/savings account to be deployed for short term goals like new car, new home down payment, mortgage payoff)

delamer
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Re: What percentage of you 2017 income can you account for?

Post by delamer » Sat Apr 14, 2018 10:31 pm

Kenkat wrote:
Sat Apr 14, 2018 9:01 pm
delamer wrote:
Sat Apr 14, 2018 7:10 pm
Kenkat wrote:
Sat Apr 14, 2018 8:43 am
I input and categorize everything in Quicken. I try to allocate everything to a category although I do have a miscellaneous bucket for a few items that don’t fit other categories. I also allocate expenses at a total level - i.e., anything from Wal-Mart or Target goes into the Household line, everything from Kroger goes into the Grocery line, etc. I don’t break out items at a receipt level.

My Miscellaneous category was 0.7% of total last year so I accounted for 99.3% of spending.
I am even more anal then Kenkat. :wink:

I have, literally, 99.8% of expenses accounted for via Quicken.

I have categories like auto, food, clothing, mortgages, taxes, healthcare, travel. Within those are subcategories — under auto, for example, there are subcategories for fuel, service, insurance, registration fees.

Income tax refunds or taxes due based on TurboTax calculations are included in the filing year’s income/expenses.
HaHa, I will tell my wife. I think she can’t stand that I get so detailed but she pretends to tolerate it :happy
I suspect the same with my spouse, but the genders are reversed!

squirm
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Re: What percentage of you 2017 income can you account for?

Post by squirm » Sun Apr 15, 2018 12:51 am

BuckyBadger wrote:
Sat Apr 14, 2018 7:59 pm
We don't track anything, really. We put away plenty of money before our paychecks even hit our account and then spend what's left.

I could look back at credit card receipts, but there's really no reason to at this point until we need to increase our cash flow.

So, zero percent i suppose.
Neither do we. I guess I'd ask why..What is the point of tracking, at least for us we generally only spend when we have too or really want too. Tracking gas, food, haircuts, electrical usage, etc is pointless. I'd notice if something is out of whack anyways.

UpperNwGuy
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Re: What percentage of you 2017 income can you account for?

Post by UpperNwGuy » Sun Apr 15, 2018 1:43 am

100% because I log all expenses into Moneydance along with their budget categories.
Last edited by UpperNwGuy on Sun Apr 15, 2018 10:55 am, edited 1 time in total.

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Re: What percentage of you 2017 income can you account for?

Post by jlawrence01 » Sun Apr 15, 2018 1:59 am

We track 100% of our income and expenses and have done so since I retired five years ago. Our initial goal was to make sure that we could afford to retire at ages 53 and 56 and so that we could keep track of where the money was going.

Tracking the expenses takes all of two minutes a day using an Excel spreadsheet that I have set up.

Tracking the expenses gives me a lot of information I would not have otherwise.

SQRT
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Re: What percentage of you 2017 income can you account for?

Post by SQRT » Sun Apr 15, 2018 10:02 am

jlawrence01 wrote:
Sun Apr 15, 2018 1:59 am


Tracking the expenses takes all of two minutes a day using an Excel spreadsheet that I have set up.

Tracking the expenses gives me a lot of information I would not have otherwise.
Same here. Been doing so for about 25 years. Retired for almost 12 years. In my view this information helps to control spending. But many think they can control their spending other ways.

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midareff
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Re: What percentage of you 2017 income can you account for?

Post by midareff » Sun Apr 15, 2018 10:03 am

I track 100% of my income and expenses in a "Budget Book", in excel. We are retired so income (pension, SS and investment including RMD) and many costs are fixed at the beginning of the year. All income (pension, SS and investment) flows into 4 accounts (checking, escrow, travel and savings) @ our bank.

Goinganontoday
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Re: What percentage of you 2017 income can you account for?

Post by Goinganontoday » Sun Apr 15, 2018 10:06 am

100%. We track everything using YNAB. After the initial set up and getting accustomed to it, we spend very little ongoing time managing it. We have a bunch of categories, but that’s not really necessary. We just prefer to have it that way. The basic groups of categories we use are monthly expenses (rent, child care, internet, etc); sinking funds (life and auto insurance, car registration, etc); and savings (retirement, house down payment, college, etc). I love the reports that I can generate using YNAB.

hookemhorns
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Re: What percentage of you 2017 income can you account for?

Post by hookemhorns » Sun Apr 15, 2018 10:26 am

Also 100%. It's a gamechanger in terms of personal finance. Not only do I understand where all our money is going, but I can project out reasonably accurately our savings, net worth, and cash flow. If we need to cut back, I also have a good understanding where and how much we could cut.

delamer
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Re: What percentage of you 2017 income can you account for?

Post by delamer » Sun Apr 15, 2018 10:52 am

squirm wrote:
Sun Apr 15, 2018 12:51 am
BuckyBadger wrote:
Sat Apr 14, 2018 7:59 pm
We don't track anything, really. We put away plenty of money before our paychecks even hit our account and then spend what's left.

I could look back at credit card receipts, but there's really no reason to at this point until we need to increase our cash flow.

So, zero percent i suppose.
Neither do we. I guess I'd ask why..What is the point of tracking, at least for us we generally only spend when we have too or really want too. Tracking gas, food, haircuts, electrical usage, etc is pointless. I'd notice if something is out of whack anyways.
So you don’t know how much you typically spend on any given budget category, but you’d notice if your spending on that category was unusual?

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 11:18 am

Gill wrote:
Sat Apr 14, 2018 8:01 pm
100% using Quicken and have done so since about 1989.
Gill
Wow. That is impressive! What is your estimate of the time it took you to do that?

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 11:37 am

SQRT wrote:
Sun Apr 15, 2018 10:02 am
jlawrence01 wrote:
Sun Apr 15, 2018 1:59 am


Tracking the expenses takes all of two minutes a day using an Excel spreadsheet that I have set up.

Tracking the expenses gives me a lot of information I would not have otherwise.
Same here. Been doing so for about 25 years. Retired for almost 12 years. In my view this information helps to control spending. But many think they can control their spending other ways.
Tracking expenses makes much more sense when you are actually retired. So you have time for it. Especially if you have a spouse that spends too much. Or you spend too much. Controlling expenses in retirement is much more important than during accumulation years IMO. I hope I never have to track expenses down to the dollar. As near as I can tell about 50% of our income is discretionary. We could cut back. I'm not going to start careful tracking unless it becomes needed.

Gill
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Re: What percentage of you 2017 income can you account for?

Post by Gill » Sun Apr 15, 2018 11:44 am

dknightd wrote:
Sun Apr 15, 2018 11:18 am
Gill wrote:
Sat Apr 14, 2018 8:01 pm
100% using Quicken and have done so since about 1989.
Gill
Wow. That is impressive! What is your estimate of the time it took you to do that?
It really doesn't take that much time. I make entries of income and expense daily. It gives me a great deal of information for taxes and the budgeting enables me to track actual vs. budget and an understanding of cash flows. I think most of all it gives me the confidence I am not overspending and can afford a rather expensive lifestyle in retirement. Also, I only track my expenses and income, not my wife's. Must confess - I also enjoy it.
Gill

SQRT
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Re: What percentage of you 2017 income can you account for?

Post by SQRT » Sun Apr 15, 2018 11:50 am

dknightd wrote:
Sun Apr 15, 2018 11:37 am
SQRT wrote:
Sun Apr 15, 2018 10:02 am
jlawrence01 wrote:
Sun Apr 15, 2018 1:59 am


Tracking the expenses takes all of two minutes a day using an Excel spreadsheet that I have set up.

Tracking the expenses gives me a lot of information I would not have otherwise.
Same here. Been doing so for about 25 years. Retired for almost 12 years. In my view this information helps to control spending. But many think they can control their spending other ways.
Tracking expenses makes much more sense when you are actually retired. So you have time for it. Especially if you have a spouse that spends too much. Or you spend too much. Controlling expenses in retirement is much more important than during accumulation years IMO. I hope I never have to track expenses down to the dollar. As near as I can tell about 50% of our income is discretionary. We could cut back. I'm not going to start careful tracking unless it becomes needed.
Agree, although we don’t spend too much. More the opposite. Our income (divs and cap gains) keeps increasing so we have loosened the spending somewhat over the past few years.

I forecast out the current year and two more to help decide where we will spend the extra discretionary funds. This way we can build a “pipeline” of discretionary spending and ensure we use the funds on things we value the most. New cars, reno’s, expensive trips, gifts, etc. Obviously, if markets don’t cooperate , we adjust.

SQRT
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Re: What percentage of you 2017 income can you account for?

Post by SQRT » Sun Apr 15, 2018 11:54 am

Gill wrote:
Sun Apr 15, 2018 11:44 am
dknightd wrote:
Sun Apr 15, 2018 11:18 am
Gill wrote:
Sat Apr 14, 2018 8:01 pm
100% using Quicken and have done so since about 1989.
Gill
Wow. That is impressive! What is your estimate of the time it took you to do that?
It really doesn't take that much time. I make entries of income and expense daily. It gives me a great deal of information for taxes and the budgeting enables me to track actual vs. budget and an understanding of cash flows. I think most of all it gives me the confidence I am not overspending and can afford a rather expensive lifestyle in retirement. Also, I only track my expenses and income, not my wife's. Must confess - I also enjoy it.
Gill
Agree. My wife has her own source of income (divs and pension) that she spends. This is less than 10% of my income. I have no idea what she does with it other than the fact that she dresses very well and buys me nice gifts.

We are both retired accountants and also enjoy tracking things. I actually look forward to “balancing the books” at month end. We are certainly in the minority and understand that many would think we go overboard.
Pretty hard to knock it though, given our obvious financial success.
Last edited by SQRT on Sun Apr 15, 2018 11:57 am, edited 2 times in total.

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 11:56 am

Gill wrote:
Sun Apr 15, 2018 11:44 am
Also, I only track my expenses and income, not my wife's. Must confess - I also enjoy it.
Gill
Doesn't that leave out 1/2 of the equation?

The Wizard
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Re: What percentage of you 2017 income can you account for?

Post by The Wizard » Sun Apr 15, 2018 11:58 am

BuckyBadger wrote:
Sat Apr 14, 2018 7:59 pm
We don't track anything, really. We put away plenty of money before our paychecks even hit our account and then spend what's left.

I could look back at credit card receipts, but there's really no reason to at this point until we need to increase our cash flow.

So, zero percent i suppose.
Same here.
I didn't try to track cash flow by category when I was working and I'm certainly not going to start now that I'm retired.

Now I do have a good handle on my expected income for the year along with tax withholding and Medicare IRMAA tiers...
Attempted new signature...

SQRT
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Re: What percentage of you 2017 income can you account for?

Post by SQRT » Sun Apr 15, 2018 12:02 pm

pondering wrote:
Sat Apr 14, 2018 8:06 am
I just finished our taxes. We need to pay an additional 1800 which was less than 2% of our income.

Does anyone produce a report of where all their money goes for a tax year? What categories do you use?
I forecast our taxes out for 3 years and use that to determine instalments over the same period. Not that hard to do really. Tax rates on divs, pensions, cap gains are all know in advance and I simply forecast the div growth and planned cap gain harvesting to get the taxes owing. This year my total tax forecast was within .5% of taxes or .15% of income. Pretty close.

quantAndHold
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Re: What percentage of you 2017 income can you account for?

Post by quantAndHold » Sun Apr 15, 2018 12:02 pm

All of it, but my three categories are saved, spent, and expensive one time projects. I pull the one time projects into a separate category so that they can be accounted for on a multi-year basis.

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 12:17 pm

quantAndHold wrote:
Sun Apr 15, 2018 12:02 pm
All of it, but my three categories are saved, spent, and expensive one time projects. I pull the one time projects into a separate category so that they can be accounted for on a multi-year basis.
I think this is the hardest category to budget for "expensive one time projects". How you budget for that? How do you "pull the one time projects into a separate category so that they can be accounted for on a multi-year basis."

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Sheepdog
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Re: What percentage of you 2017 income can you account for?

Post by Sheepdog » Sun Apr 15, 2018 12:30 pm

I know where 100% of our spending has gone for the last 20 years using Microsoft Money.

dknightd
I think this is the hardest category to budget for "expensive one time projects". How you budget for that? How do you "pull the one time projects into a separate category so that they can be accounted for on a multi-year basis."
I always pay everything from "cash" so to buy that auto, reroof the house, or to take that $15K cruise, I "budget"save for those things. When I pay them they come from that money and they go in Money under specific accounts such as Vacation, Auto purchase, House & property maintenance, Gifts, Donations, Dentist, Hospital, etc.

edit slightly to correct spelling and meaning
Last edited by Sheepdog on Sun Apr 15, 2018 1:48 pm, edited 1 time in total.
People should not say everything they think. They should think about everything they say.

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 1:39 pm

Sheepdog wrote:
Sun Apr 15, 2018 12:30 pm
I know where 100% of our spending has gone for the last 20 years using Microsoft Money.

dknightd
I think this is the hardest category to budget for "expensive one time projects". How you budget for that? How do you "pull the one time projects into a separate category so that they can be accounted for on a multi-year basis."
I always pay everything for "cash" so to buy that auto, reroof the house, or to take that $15K cruise, I "budget"save for those things. When I pay them they come from that money and they go in Money under specific accounts such as Vacation, Auto purchase, House & property maintenance, Gifts, Donations, Dentist, Hospital, etc.
How much cash do you keep on hand?

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Re: What percentage of you 2017 income can you account for?

Post by Gill » Sun Apr 15, 2018 1:41 pm

dknightd wrote:
Sun Apr 15, 2018 11:56 am
Gill wrote:
Sun Apr 15, 2018 11:44 am
Also, I only track my expenses and income, not my wife's. Must confess - I also enjoy it.
Gill
Doesn't that leave out 1/2 of the equation?
Not at all. She has her own source of income and her personal expenses which represent about 5% of mine. Neither of us have any need to track hers.
Gill

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 2:00 pm

Not at all. She has her own source of income and her personal expenses which represent about 5% of mine. Neither of us have any need to track hers.
Gill
[/quote]

Cool. I wish I was in your shoes.

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Sheepdog
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Location: Indiana, retired 1998 at age 65

Re: What percentage of you 2017 income can you account for?

Post by Sheepdog » Sun Apr 15, 2018 2:08 pm

dknightd wrote:
Sun Apr 15, 2018 1:39 pm
.
How much cash do you keep on hand?
It's not necessarily "cash" but it could be checking, short term bond funds, money market and maybe even shorter term CDs coming due. Without being too long winded....I am retired. I have a set percentage to take from all accounts...for me it is 4.5% a year. I have stayed within that average, reasonably so. If I don't actually spend 4.5% in a year, and I often do not, the amount I do not spend, that amount is "banked"...not an actual bank, but a paper entry. That often grows from year to year.....like right now my "unspent 4.5% distribution", or an accumulation of unspent budget withdrawals, totals $35,350. I can go buy a low mileage year old auto right now and pay cash for it and I will probably still be under my 4.5% average annual withdrawal.....and I am planning to just do that this spring for my wife. (I have been doing this for 19 years in retirement.)
People should not say everything they think. They should think about everything they say.

dknightd
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Re: What percentage of you 2017 income can you account for?

Post by dknightd » Sun Apr 15, 2018 7:38 pm

Sheepdog wrote:
Sun Apr 15, 2018 2:08 pm
It's not necessarily "cash" but it could be checking, short term bond funds, money market and maybe even shorter term CDs coming due. Without being too long winded....I am retired. I have a set percentage to take from all accounts...for me it is 4.5% a year. I have stayed within that average, reasonably so. If I don't actually spend 4.5% in a year, and I often do not, the amount I do not spend, that amount is "banked"...not an actual bank, but a paper entry. That often grows from year to year.....like right now my "unspent 4.5% distribution", or an accumulation of unspent budget withdrawals, totals $35,350. I can go buy a low mileage year old auto right now and pay cash for it and I will probably still be under my 4.5% average annual withdrawal.....and I am planning to just do that this spring for my wife. (I have been doing this for 19 years in retirement.)
Sounds like a good plan. I plan to do similar. I'm wondering how I might document that plan in case I die first

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Sheepdog
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Location: Indiana, retired 1998 at age 65

Re: What percentage of you 2017 income can you account for?

Post by Sheepdog » Sun Apr 15, 2018 8:11 pm

dknightd wrote:
Sun Apr 15, 2018 7:38 pm

Sounds like a good plan. I plan to do similar. I'm wondering how I might document that plan in case I die first
Ha! I understand!!! I have written things down and explained, but I doubt if my love will follow it. Thru most of my years with her, I know she will budget things the way she wants to. I won't be looking over her. She will do well as she is a great frugal family manager and person, so I don't worry about that. After all, I don't know of anyone who is able to manage things or wives from the grave:?:
People should not say everything they think. They should think about everything they say.

jlawrence01
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Re: What percentage of you 2017 income can you account for?

Post by jlawrence01 » Mon Apr 16, 2018 2:03 am

SQRT wrote:
Sun Apr 15, 2018 10:02 am
jlawrence01 wrote:
Sun Apr 15, 2018 1:59 am


Tracking the expenses takes all of two minutes a day using an Excel spreadsheet that I have set up.

Tracking the expenses gives me a lot of information I would not have otherwise.
Same here. Been doing so for about 25 years. Retired for almost 12 years. In my view this information helps to control spending. But many think they can control their spending other ways.

I am not sure that we record our expenses to control spending ... although it sure helps. We like how it helps to prioritize spending. We are going to continue to do the things that we want to do which includes traveling approximately ten weeks a year and to undertake a small kitchen renovation this summer.

It allows us to have a historical spending by category so we better notice when certain charges are higher than in the past. Having the data at my fingertips helped me catch a $120 pharmacy overcharge last month. Or that one of the charities that we supported understated our contributions by $900.

It also provides us with a database of the various vendors we have used so we can provide information to our neighbors as to contractors we used, restaurants we have eaten at all in one place.

And having all of the data helps a lot in financial and estate planning.

Personally, I wish we had done this before retiring and perhaps retired earlier.

scrabbler1
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Re: What percentage of you 2017 income can you account for?

Post by scrabbler1 » Mon Apr 16, 2018 6:38 am

I have about a dozen broad expense categories but within a few of them I further divide them into a few more. An example of something I further divide is the monthly maintenance charges I pay for my co-op apartment - that payment includes property taxes and mortgage interest, both tax deductible (if I itemize) and reported to me separately via the 1098 form I receive when the year is over. Many of my smaller expenses I just lump into a broad category called "cash" which comes from the ~$160 I withdraw from an ATM each month. Some expenses, such as medical expenses, I have to gather from multiple payment methods such as cash, check, and credit card.

dcabler
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Re: What percentage of you 2017 income can you account for?

Post by dcabler » Mon Apr 16, 2018 6:46 am

I do a spot check once per year.
1. We pay most everything on our credit card, then pay it off each month. All of that is available for download into a spreadsheet, along with categories
2. We download everything from the checking account as well.

Combine 1, and 2 and sort by categories, making a few adjustments.

That gets us most everything. We only manually write a few checks and don't take out all that much cash.

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Cycle
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Re: What percentage of you 2017 income can you account for?

Post by Cycle » Mon Apr 16, 2018 7:16 am

Ive tried to categorize expenses, but it's too much work and not worth it imo if your savings rate is really high and you know how much is spent on big ticket items (housing, vehicles, pets, medical, loan service), the rest just ends up being trivial, for us anyway.

RadAudit
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Re: What percentage of you 2017 income can you account for?

Post by RadAudit » Mon Apr 16, 2018 7:23 am

Cycle wrote:
Mon Apr 16, 2018 7:16 am
imo if your savings rate is really high and you know how much is spent on big ticket items (housing, vehicles, pets, medical, loan service), the rest just ends up being trivial, for us anyway.
~ +1

LBYM. Invest the rest and roll on. Of course, most of our big expenditures are in the past, I hope.
FI is the best revenge. LBYM. Invest the rest. Stay the course.

RickBoglehead
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Re: What percentage of you 2017 income can you account for?

Post by RickBoglehead » Mon Apr 16, 2018 7:31 am

I use Quicken. Every Saturday morning I sit at my desk with my cup of coffee and reconcile for the week. 99.9% of my purchases are credit card, and are downloaded, and I then allocate them, reconciling against the pile of receipts for the week. If I spend cash, I get a receipt and enter that too. I've been doing this in Quicken since 1996 (before that Managing Your Money, before that Lotus 1-2-3, before that a very wide piece of accounting paper). As a result, I've always known within a few thousand how much we spend a year.

In 2017, MISC accounted for about 0.2% of my expenses. I also have a Loss-Gain bucket, for when I reconcile cash every few months and true up. Last year I gained $0.45...

This takes me less than 1/2 hr a week. I also manage my mother's funds in this manner, excluding cash, and only allocate expenses that I can tell what they are, putting the rest in NTA (Need To Allocate). I used to allocate these a few times a year in an painful phone call, but since it didn't result in any reduced spending I don't bother any more. Up until last year, I did similar for my in-laws before they passed away. All 3 took me maybe an hour to 90 minutes which included bill paying.

A few years from retirement, it's great to know exactly how much you're spending and where to plan for the future. I've created an Excel spreadsheet for topline retirement planning, but haven't considered taking that to a line item anytime soon.

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Artful Dodger
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Re: What percentage of you 2017 income can you account for?

Post by Artful Dodger » Mon Apr 16, 2018 12:43 pm

I would say 100%.

98% is paid via check/debit or credit card. That leaves ATM $ which I categorize when I balance my check book.

Categories

Investments - 401k
Mortgage
Household exp
Utilities
Garden / Yard
Grocery
Wine
Medical
Auto Exp (payment, gas & repairs)
Insurance (Life - Auto - Home)
Entertainment (shows, concerts, eating out)
Vacation
Personal Exp - me
Personal Exp - spouse
Kid's related (educational / college / gifts)

Personal exp is mostly daily spending on self, clothes, etc.

Most ATM $ ends up categorized as personal exp, household, entertainment, vacation.

We're heavy CC users as we either get 2% cash back or airline miles.

michaeljc70
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Re: What percentage of you 2017 income can you account for?

Post by michaeljc70 » Tue Apr 17, 2018 2:50 pm

I charge everything I reasonably can. I download all those into quicken almost daily and categorize them the best I can. I try not to wait more than a day or two as it is hard to remember especially for places like Costco where the purchase couple for many categories. I try to record cash purchases, but ignore some of the smaller ones. I would say I know with pretty good accuracy where my my money goes. If my miscellaneous or unknown categories get too big I try harder.

I would say I spend less than 20 minutes a week on this. Though I don't particularly follow a line item budget, I do find it interesting to see where my money actually goes and make spending adjustments if a category goes off the rails unnecessarily. Friends that don't track their expenses tell me they know where their money goes, but if you don't actually track it, I bet there are some surprises.

I track expenses in about 50 categories but generally examine them at a higher level.

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