Financial Goals

Overview

The Financial Goals feature in Finuncle empowers you to create sophisticated, quantitative goals using formula-based KPIs (Key Performance Indicators) built from your financial fundamentals. This powerful system allows you to track complex financial metrics that automatically update as your financial situation evolves, making it ideal for serious financial planning and monitoring.

What Makes Finuncle Goals Different

Unlike traditional goal-setting tools that focus on static target amounts, Finuncle provides access to comprehensive financial fundamentals that you can combine into custom formulas. Each goal becomes a live metric that recalculates based on your actual financial data, giving you real-time insights into your financial health.

Structure

A goal has a KPI it tracks. KPI is the formula you define based on your fundamentals. Fundamentals are fundamental financial features of a user. like TotalAsset - Sum of market value of all assets of the user. You can develop your own KPI formula using the Fundamentals. 

On a goal, you can also set priority to compare and decide among a list of goals. Also, you can define a monthly expense from your income statement, that will help in reaching your goal. This contribution from monthly expense can help better depict how your goal timeline is affected with monthly contributions.

Available Fundamentals

Finuncle provides access to a comprehensive set of financial fundamentals that you can use in your goal formulas:

Asset Fundamentals

Performance Metrics

Liability Fundamentals

Non-Performing Assets

Other Fundamentals

Creating Powerful Goal Formulas

Using these fundamentals, you can create sophisticated KPIs, and in-turn, goals, that truly reflect your financial objectives. Here are some examples:

Net Worth Tracking

Formula: kpi = TotalAsset - TotalLiability

Track your real net worth in real-time, automatically updating as assets and liabilities change.

Liquidity Ratio

Formula: kpi = (TotalCash + TotalBankAccounts) / TotalExpense

Monitor how many months of expenses you can cover with liquid assets.

Debt-to-Asset Ratio

Formula: kpi = TotalLiability / TotalAsset * 100

Keep track of your leverage and ensure it stays within healthy bounds.

Investment Performance Score

Formula: kpi = (ReturnOnAssets * AbsInvestment) / TotalAsset

Create a weighted performance metric for your investment portfolio.

Precious Metals Allocation

Formula: kpi = (TotalGold + TotalSilver + TotalPlatinum) / TotalAsset * 100

Track what percentage of your portfolio is allocated to precious metals.

Liability Cost Impact

Formula: kpi = AbsLiabilityInterest / (TotalAsset - TotalLiability)

Measure how much your debt costs relative to your net worth.

Bad Debt Warning Indicator

Formula: kpi = (TotalNpa + TotalLent) / TotalAsset * 100

Monitor exposure to non-performing assets and loans given to others.

Emergency Fund Adequacy

Formula: kpi = (TotalCash + TotalBankAccounts) / (TotalExpense * 6)

Track progress toward a 6-month emergency fund (adjust multiplier as needed).

Step-by-Step Guide

Step 1: Identify Your Metric

Determine what financial aspect you want to track. Consider ratios, percentages, or composite scores rather than simple amounts.

Step 2: Select Your Fundamentals

Choose from the available fundamentals that relate to your goal. You can combine multiple fundamentals using mathematical operators.

Step 3: Build Your Formula

Create your formula using:

Step 4: Set Target Values

Define:

Scenario Analysis

Use your formula-based goals to test different scenarios:

What-If Analysis Examples

Decision Support

Before making financial decisions, modify the fundamental values temporarily to see how your goals would be affected:

Best Practices

Keep Formulas Meaningful

Ensure each formula represents a metric that actually influences your financial decisions. Avoid creating goals just because you can.

Regular Calibration

Review your formulas quarterly to ensure they still align with your financial priorities and life circumstances.

Document Your Logic

Add clear descriptions to each goal explaining:

Balance Multiple Perspectives

Create a portfolio of goals that cover:

Start with Core Metrics

Begin with essential ratios like:

Then add more sophisticated metrics as you become comfortable.

Common Formulas Library

Safety Metrics

Growth Metrics

Efficiency Metrics

Troubleshooting

Zero or Null Values

Some fundamentals may be zero if you haven't entered data for those categories. Ensure your formulas handle division by zero gracefully.

Unexpected Results

Formula Validation

Test your formula with current values to ensure it calculates correctly before setting targets.

Next Steps

Ready to create your first quantitative goal? Navigate to the Goals section in your Finuncle dashboard and start building custom KPIs using these fundamentals. Remember, the power of Finuncle's goal system lies in creating formulas that provide actionable insights into your financial health.