Expenses

Your expenses drive your cashflow. They decide how much you can save and invest each year, and how long your money lasts in retirement. Some expenses also reduce your tax.

Find them under Plan → Cash Flow → Expenses. The page has three sections:

Events in your plan, like buying a property or a car, can also add expenses. See Expenses from events below.

If you haven't added any living expenses yet, you have three options:

Not sure what you spend? Our blog guide on Baselining Your Expenses walks you through it.

Click Edit Expenses to open the Edit Expenses panel. Use Full screen for more room.

Canwi organises spending into buckets. By default you get three:

You're not locked in. Rename or add buckets with the Add Bucket option menu, add line items with Add Expense, and delete anything that doesn't apply.

For each line item, enter an amount and how often you pay it (weekly, monthly, yearly and so on). Canwi converts everything to a yearly figure for your projections.

Click an expense, or its ⋮ menu, to open Edit Expense.

1. Bucket. Move the expense to a different bucket.

2. Amount. The amount and how often you pay it.

3. Deduction. Turn on Tax Deductible if you can claim this expense. Then choose:

Note: For investment properties, you usually don't need to claim deductions here. Enter running costs in Annual Property Expenses on the property, and set up the loan on the Debts page. Canwi then claims the property expenses and loan interest for you automatically. Only use Rental Property Expense or Interest Expense here for a cost that doesn't fit there, and don't enter the same cost in both places.

4. Inflation. Expenses grow each year at your scenario's inflation rate (2.6% by default). Turn on Custom Rate to change this for one expense:

Depreciation expenses don't grow with inflation.

5. Summary. A plain-English check of how Canwi will treat the expense. For example: "$924 a year. Claimed as a tax deduction for Helly under Rental Property Expense. Grows at Inflation (2.6%) each year."

Click Save changes, or Delete to remove the expense.

Running costs for an investment property belong on the property, not in living expenses. When you add or edit a property in Home & Real Estate, enter them as one yearly total in Annual Property Expenses. Include:

Your own home is different. Annual Property Expenses and Annual Depreciation only appear on investment properties. For your main residence, enter costs like strata, council rates and home insurance as living expenses. The default Home & Utilities line item is set up for this.

These costs are included in your cashflow. For investment properties, Canwi also claims them as a tax deduction for the property's owners.

Annual Depreciation is the yearly deduction for wear and tear on an investment property's building and fixtures. Canwi uses the prime cost (straight-line) method: the same amount is claimed each year until the End Year. It reduces your tax but doesn't affect your cashflow.

A quantity surveyor's depreciation schedule gives you this figure. If your schedule uses the diminishing value method, its yearly amounts fall over time, so enter an average. Building depreciation usually runs for 40 years from construction, so set the End Year to match.

Loan repayments come from the Debts page. They show here so you can see your full spending, but you can't edit them here. The total excludes any extra repayments Canwi makes from surplus cash or from the Additional Debt Repayments event.

Don't add your mortgage or loans as living expenses too. They'll be counted twice.

Your spending won't stay the same. Use the Change Expenses event on your timeline to:

Add a Change Expenses event in Plan Builder, set the year, and update the amounts. The new amounts apply from that year on.

Some expenses come from events on your timeline rather than from this page. They're set up on the event in Plan Builder, and Canwi adds them to your projections automatically. For example:

To change one of these costs, edit the event, not this page. Event expenses show in the Expense Projection in the year they happen, which is why you may see spikes in the chart.

Use the filters above your expenses:

On the right:

Why are my property expenses in two places, on the property and in my living expenses?

They shouldn't be. Enter running costs for an investment property (rates, strata, management fees) on the property in Home & Real Estate, not in living expenses. Otherwise Canwi counts the cost twice. Costs for your own home are the exception: they do go in living expenses. To fix it, delete the line from your living expenses and add it to Annual Property Expenses on the property.

Should I include my mortgage or loan repayments?

No. Repayments come from the Debts page and already show in the Debt Repayments section. Adding them as a living expense counts them twice.

Why is my full yearly expense in my first year when my plan starts mid-year?

Yearly expenses aren't pro-rated. If your plan starts in October, a $1,200 yearly expense still counts as $1,200 in year one. If that matters, enter it monthly, weekly etc ($100 a month) instead.

How do I add an expense that starts later, like childcare or school fees?

Use a Change Expenses event on your timeline, set to the year it starts. Set Show to All to see future expenses on this page.

Why are there big spikes in my Expense Projection?

Usually an event, like buying a property or car, or an Incur Expense event for a one-off cost. These are set on the event in Plan Builder. Edit the event to change the amount or year.

Will my spending change in retirement?

The Expense Projection splits retirement into phases: Go Go, Slow Go and No Go. Most people spend more early in retirement and less later. You'll need to use the "Change Expenses" event to adjust expenses over time to achieve this.

What does the Budget Breakdown gap mean?

It compares your first-year income with your expenses. If expenses are higher, the gap is roughly what you'd draw from savings each year. A good check: did your savings actually drop by about that much over the last 12 months? If not, your expenses are probably off.

Which expenses can I claim as a tax deduction?

The common ones are investment property costs, work-related expenses, donations to registered charities, accountant fees and investment loan interest. If you're unsure whether you can claim something, check with your accountant or the ATO.

What's the difference between Cash and Depreciation?

A Cash expense leaves your account and reduces your tax. A Depreciation expense only reduces your tax. No money moves.

Some of my costs rise faster than inflation. How do I model that? Turn on Custom Rate for that expense and use Rate + Offset, e.g. Inflation + 2% for health insurance.

Can I see my expenses monthly?

Yes. Set Period to Monthly.

How detailed should my expenses be? There's no right or wrong answer, but more detail has two benefits:

If you only have a rough total, start there and break it down later.

What if my numbers aren't exact? Don't worry. You can update your expenses any time. Most people who don't follow a strict budget refine their numbers a few times as they learn more about their spending. A reasonable estimate now is better than waiting for a perfect one.