Feature spotlight: Savings
The Savings tool enables users to break down each month's savings goal into multiple sub-goals. It simultaneously provides a record of past savings and a plan for future savings.
Setting Goals
Use the buttons at the bottom of the sheet to add, delete, and rename savings goals. Whenever you create a new goal, you will be given the option of listing an initial amount saved. For instance, if you are saving toward a computer and already have stashed $500 at the time of the creation of your budget, this is where you can take that into account. This number can always be adjusted in column B.
Setting Goals
Use the buttons at the bottom of the sheet to add, delete, and rename savings goals. Whenever you create a new goal, you will be given the option of listing an initial amount saved. For instance, if you are saving toward a computer and already have stashed $500 at the time of the creation of your budget, this is where you can take that into account. This number can always be adjusted in column B.
The type of goals you choose are completely up to you. Here are some example objectives.
- Saving for a large item/purchase over the course of many months. This could be for electronics, vacation, engagement ring, car, home, or similar.
- Preparing for inconsistent expenditures. For example, you may want to budget $600 per year for auto maintenance, but you can't be sure which months you will spend it. Putting away $50 each month will guarantee you have the cash on hand when you need it.
- Investing for the long-term. Some of our savings, such as for retirement, future college tuition, or an emergency fund, might not have a hard date attached; however, storing up for these things now is good for us now and down the road.
In the month of February, this user's aim is to save $50 toward car maintenance, $300 for retirement, $100 for an emergency fund, and $80 for a future vacation. Note that these are goals for a future month. Click on the "Adjust monthly" button to read what to do when once the month is over and you have met your goal or not
Spending money from your savings
If you're saving for a particular purchase, there will come a time to make that purchase. Or if you're saving for a rainy day, maybe you have a tough month and need to dip into that fund. Here's how to record it in the spreadsheet.
Example 1
Perhaps you have slowly saved $1,000 to buy that new laptop and you finally have the funds you need (congratulations!). How should you record it in this sheet? In the month that you make the purchase (April in the example below), list your "goal" as -$1,000. This is because relative to your other savings goals, this month, you plan to spend an additional $1,000.
If you're saving for a particular purchase, there will come a time to make that purchase. Or if you're saving for a rainy day, maybe you have a tough month and need to dip into that fund. Here's how to record it in the spreadsheet.
Example 1
Perhaps you have slowly saved $1,000 to buy that new laptop and you finally have the funds you need (congratulations!). How should you record it in this sheet? In the month that you make the purchase (April in the example below), list your "goal" as -$1,000. This is because relative to your other savings goals, this month, you plan to spend an additional $1,000.
Example 2
To plan for unexpected home maintenance, you save $200 per month. In March, you have to spend $300 to repair an appliance. As your goal for that month, you list -$100 to account for the $200 you routinely try to save less the amount you expect to spend
To plan for unexpected home maintenance, you save $200 per month. In March, you have to spend $300 to repair an appliance. As your goal for that month, you list -$100 to account for the $200 you routinely try to save less the amount you expect to spend
Evaluating your savings
Most months you are not going to save exactly the amount you set as your goal. At the end of each month, you may want to take note of any surplus or deficit you have. This is where the "Adjust" column comes into play.
Exceeding your goals
Suppose you had a total savings goal of $680 for the month, but you actually earned $772 more than spent. That means you have additional $92 of savings, which at this point have not been designated for any purpose.
Most months you are not going to save exactly the amount you set as your goal. At the end of each month, you may want to take note of any surplus or deficit you have. This is where the "Adjust" column comes into play.
Exceeding your goals
Suppose you had a total savings goal of $680 for the month, but you actually earned $772 more than spent. That means you have additional $92 of savings, which at this point have not been designated for any purpose.
Here is how to put some of those dollars toward your goals. Say you would like to put $30 into the vacation. Simply enter $30 into the "Adjust" column
Notice that the bottom cell now reads the remaining savings surplus of $62. If you then decide to divide that up between home maintenance and retirement, you will see the following
The bottom cell now reads "Balanced," meaning you have given each of your saved dollars a purpose toward one of your goals. At the same time, you have for your record that you met and exceeded your original goals.
Falling short of your goals
Some months you might not reach your total savings goal. That's okay, but you now won't have quite as much saved up as you planned. You will want to take that into account.
Suppose you had a total savings goal of $595 for the month but only actually saved $580. That means you were $15 short of meeting all of your goals. Unfortunately, you will have to decide on one of more of your goals to remove $15 here. In the image below, the user decides to put $15 less toward their vacation fund. Notice that the bottom cell now reads "Balanced."
Falling short of your goals
Some months you might not reach your total savings goal. That's okay, but you now won't have quite as much saved up as you planned. You will want to take that into account.
Suppose you had a total savings goal of $595 for the month but only actually saved $580. That means you were $15 short of meeting all of your goals. Unfortunately, you will have to decide on one of more of your goals to remove $15 here. In the image below, the user decides to put $15 less toward their vacation fund. Notice that the bottom cell now reads "Balanced."
