My Financial Plan Support

My Financial Plan defines “expenses” as all the various ways that cash leaves your account. Here are some examples of expenses in My Financial Plan:

• Withdrawing $100 from an ATM to take your family to dinner
• Using a debit card to pay for a $100 dinner
• Writing a check for $100 for dinner
• Paying a credit card bill of $100 that you accumulated from buying dinner. Using the credit card creates a debt and paying the debt creates the expense.
• Buying $100 worth of equity in a restaurant stock. In this case, the $100 expense will be matched by a $100 asset in your investments.
• Putting a $100 down payment for a mortgage to buy a restaurant. Here the $100 expense will be accompanied by equity in the restaurant and My Financial Plan will create a debt for the balance of the mortgage.

Connecting and Categorizing Expenses

There are two ways to tell us about your historical expenses:

1. You can enter expense levels manually in the initial setup process, and
2. You can connect bank accounts, credit cards and other financial accounts directly to My Financial Plan. Connecting your cards and accounts allows for increased accuracy and automatic updates of your expenses. 

For connected accounts, My Financial Plan will attempt to categorize your expenses into nine categories, each with their own list of subcategories. You can even create your own subcategories if you like! Categorizing expenses is used to develop budgets in the “Budget expenses” event. My Financial Plan will use your last 12 months of transaction history to project your future expenses and display your current expenses.

Categorizing expenses is surprisingly hard to do with 100% accuracy. Therefore, we've built in the ability to edit the transaction categories of all your expenses, as well as set up rules to re-categorize matching expenses in the future.

Projecting Expenses

We use your historical expenses to project your future expenses. We do not assume that your expenses will grow automatically with your income. However, you can use the “Budget expenses” event to plan to spend more (or less!) in the future.

We do not apply inflation effects to expenses in the future. If you'd like to learn more about how we deal with the effects of inflation, you can learn more here.