Additional Expenses (Vehicles, Travel, Renovations, etc.)

A total of regular recurring lifestyle expenses are typically entered under Base Expenses in your projections. If you would like to highlight certain expenses, you can do this as shown here. Additional expenses can be entered directly under Scenario Setup -> Expenses -> Additional Expenses.

Prefer to watch a 5-minute video on this topic? Here it is:

Select Scenario Setup -> Expenses.

Click Add Expense within the Additional Expenses section.

The text within the Description column will display as the column title for this expense on the Planning page. Input the Amount and select Joint as Yes to split it 50% to each spouse.

Remember that Snap works with nominal dollars within the projections. To convert from today's dollars to future dollars, you can use the Inflation field. The amount entered will be converted to nominal dollars for you based on the Inflation percentage and the number of years until the person reaches that age. The Inflation value will default to General Inflation (initially set up under Scenario Setup -> General) but you can overwrite this value by typing a new percentage.

You can specify the From Age and To Age (or the specific date if you select the gear icon in those cells). If you leave the From Age blank the expense will start in the first year of the projections. If you leave the To Age blank, the expense will continue until the end of the projections.

Enter the Frequency of the expense. If you have a single-year expense, select a Frequency of every year and then enter the same From Age and To Age. For example, a child's wedding from age 60 (Jan 1, 2027) to age 60 (Dec 31, 2027).

You can choose to Highlight up to 6 expenses between both spouses. Highlighting means that these expenses will be displayed individually on the Cash Outflows chart. If the expense is not highlighted, it will be referred to as part of the Additional Expenses category on the Cash Outflows chart.

Review the Planning page

On the Planning page, the Additional Expenses are displayed under the Expenses section. If there is a spouse in the projections, use the Combined Planning page to refer to all expenses and ensure the section is expanded by clicking the right arrow in the section header to make any edits. The total expenses are displayed on the Combined page and the individually allocated portion of each expense is displayed on the Planning page for each spouse. By default, for joint Additional Expenses, the expense is split 50% to each spouse. Any modifications can be made back under Scenario Setup -> Expenses or directly on the Combined Planning page, even for individual expenses. (There is also an Advanced Option to disable the automatic allocation of Base and Additional Expenses to each spouse. This should only be used in rare use cases.)

In this example, a $30,000 vehicle with inflation at the General Inflation rate of 2.1% purchased in 2030 would cost $33,984.

Using overrides for the Additional Expenses on the Planning page

If we wanted to change this amount to $40,000 of today's dollars instead of $30,000, we could adjust the amount under Scenario Setup - > Expenses for all of the applicable years. Alternatively, we can edit the amount directly on the Combined Planning page and edit a single year's expense. Click the value under the Additional Expense column, and in the pop-up window adjust the amount and click the Index at option to have Snap adjust the expense to the future year for inflation.

After running the scenario, if you want to revert to the original amount, you can clear the override by clicking the "x" on the right side of the cell or by clicking the dollar value and checking the box to Clear override.

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If the expense is entered in a year before the CFM Start Age, (age 65 in the example below) you'll need to manually withdraw money from one or more of the assets to cover the expense if withdrawals are needed.  Otherwise, the Base Expenses value is decreased by the amount of the expense, indicating they have less money for lifestyle expenses.  If there isn't enough cash, the Base Expenses value will be displayed as a negative number. 

Here we're looking at John's Planning page which shows 50% of a joint $30K expense, indexed at 2.1%, in the second year.

Example 1: Automatic cash flow management is disabled (Pre CFM Start Age)

Let's cover the additional vehicle expenses in the second year by withdrawing from the non-registered account. 

Click the $0 value under the Contribution/Withdrawal column for that asset to specify a withdrawal.  Here, we have entered a -$15,315.  Make sure to enter a negative number to indicate a withdrawal from the account.

After running the scenario the projections will be updated.  Note that the Base Expense value is much higher now in that year because the vehicle purchase is covered by the non-registered account withdrawal rather than having the purchase come from the client's cash flow.

You can also use this method when automatic cash flow management is enabled and you wish to withdraw from a specific account.  For joint expenses, make sure to complete the withdrawals for both spouses.

Example 2: Automatic cash flow management is enabled (Post CFM Start age), and a withdrawal override is made to a specific asset.

Let's look at the vacation expenses in the year 2029.  Since the CFM Start Age has been reached by this point in the projections, Snap automatically withdraws from the assets to cover the additional expense that year.  This is indicated by a larger withdrawal from the non-registered account that year than in the next year.

Example 3: Model a new loan to cover the expense in full, or in part.

You can show an influx of cash in a future year by entering a loan with a future start date.  For example, for a car loan of $30K (indexed with inflation) split 50% to each spouse could be entered as follows:

Under Scenario Setup -> Debts, enter the Future Start Age (the date can be selected using the gear icon).

The loan starts in the second year, with monthly payments from January 1.

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