Expenses and Goals are both used to model spending in Voyant, but they are designed to support different types of planning conversations.
There is no hard-and-fast rule for when an item must be entered as an Expense or a Goal. Many situations can be modelled either way, and the best approach depends on how you want to present and analyze the client's financial plan.
The guidance below outlines common ways advisers choose to differentiate between the two.
When might I use an Expense?
Expenses are typically used to model spending that is expected to occur as part of the client's ongoing financial plan.
Examples include:
- Living expenses
- Healthcare costs
- Regular travel and entertainment
- Ongoing discretionary spending
Expenses become part of the client's projected cash flow and are generally used to represent expected spending throughout the plan.
When might I use a Goal?
Goals are often used for significant financial objectives that advisers want to highlight or discuss separately with their clients.
Examples include:
- Purchasing a second home
- Funding a child's education
- Retirement Spending aspirations
- Making a substantial gift
- Taking a once-in-a-lifetime vacation
Goals can be prioritized independently within the financial plan, making them useful for discussing trade-offs if the client cannot fund every objective.
Which approach should I choose?
There is no single correct answer.
When deciding whether to model something as an Expense or a Goal, consider the purpose of the item within your planning conversation.
As a general guideline:
- Use an Expense when the spending is part of the client's expected lifestyle or ongoing financial commitments.
- Use a Goal when you want to emphasize a specific financial objective, evaluate its likelihood of success, or prioritize it against other objectives.
For example, one adviser may choose to model a new vehicle as an Expense because it is an expected purchase, while another may model it as a Goal because it represents a discretionary objective that could be delayed if necessary. Both approaches are valid.
Why does this matter?
Choosing the appropriate item type can make your planning conversations more meaningful.
Goals integrate with tools such as the Goal Priority Insight, allowing you to demonstrate how changing priorities may affect the client's long-term financial plan. Expenses, on the other hand, help illustrate the client's ongoing spending needs and projected cash flow.
Ultimately, the choice should reflect how you want to present the client's financial plan and the conversations you want to have during the planning process.