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Mysunsai t1_iyegeb5 wrote

Why is number 2 part of your savings rate calculation?

None of that sinking fund should be involved in savings rate at all, it’s all an expense, none of it is income or savings.

One method of doing it is:

At the time the expense occurs, you have an expense of $y from the vacation, and a reimbursement of $y (a negative expense) from the sinking fund.

When you add $x to the sinking fund, you have an expense of $x.

There are other ways as well, but that’s my preference.

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paintingredroses OP t1_iyehmha wrote

Thanks for your response!

The reason for #2 is because I use the zero-based monthly budget system. There should be $0 left at the end of the month. It’s not income, so I have to add the amount I’ll be spending to the spreadsheet somewhere so I don’t end up with a -$ at the end of the month.

Since it shouldn’t be included in my savings, I think I’ll add it as an additional expense category for the month-to-month tracking and keep my entries consistent with the steps I included above.

Thanks for the help!

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