How to read the Sankey diagram of your spending
A bank statement is a list. A Sankey diagram is a map. Both hold the same information, but only one lets you see in two seconds that 18% of what you earn goes on eating out.
How to read it
A Sankey is a flow chart. On the left are the inflows: salary, invoices, rent you collect, refunds. On the right, the outflows: housing, food, transport, leisure, savings. Between them, ribbons whose width is proportional to the money they move.
Reading it is simple: the total width on the left is everything that came in. Each ribbon leaving takes a share. If a ribbon is as wide as the housing one, you know that expense weighs as much as your home, without looking at a single number.
What not to do is try to read it like a table. A Sankey is for comparing widths, not adding up cents. For cents there is the transaction detail.
The three leaks almost everyone discovers
After looking at a few months of Sankeys from different people, three ribbons show up wider than their owner expected. Almost always the same three.
- Subscriptions. Each one is small: €12 of music, €15 of series, €10 of storage, €40 of gym, €9 for an app you no longer open. Together they add up to €90 or €120 a month, and in the Sankey they appear as a single ribbon the size of the electricity bill.
- Food delivery and eating out. Apart from the supermarket ribbon, there is another one that in many homes is just as wide. 8 orders a month at €22 is €176. Seeing that ribbon next to the food one is usually enough to halve it.
- Small transfers. Bizums, paying friends back, transfers to your own accounts that never come back. Individually they are invisible. Grouped they form a €150 or €200 ribbon you cannot say what became of.
The monthly Sankey of your personal finances
Fider draws the Sankey from your categorised transactions, with nothing to set up. Inflows on the left, categories on the right, and savings as one more ribbon, because money you do not spend has to be visible too.
You can look at it month by month or for the whole year. Comparing January's Sankey with July's is the fastest way to know whether a habit change worked. If the food delivery ribbon has narrowed, it worked. If not, it did not.
Each ribbon can be clicked to drill into the transactions. What you see is not an estimate: it is your transactions, summed by category.
The quarter Sankey if you are self-employed
For the freelance wallet the diagram changes shape. On the left is what you invoiced. From there flow the output VAT, the income tax withheld from you, the self-employed contribution, deductible expenses and, at the end, what is actually yours.
Seeing it this way fixes the most expensive confusion of working for yourself: mistaking what you collected for what you earned. When the VAT ribbon is a third of the width of what you invoiced, it is hard to keep thinking that money is available.
The quarter Sankey is built from the same transactions that feed the modelo 303 and modelo 130 drafts, so it reconciles with them.
Exporting and sharing it
A Sankey is the easiest chart to explain to someone else, whether your partner or your accountant. Fider lets you open it in MakeCharts, the chart library it is built with, to edit it, change colours or export it as an image.
One tip before sharing: group the small categories into an other ribbon. A Sankey with 25 outflows is as unreadable as the statement it was meant to replace.
Frequently asked questions
Do I need to categorise every transaction for it to work?
The more the better, but not 100%. Whatever has no category shows up as an uncategorised ribbon, and its width tells you how much work is left.
How is it different from a pie chart?
A pie shows a split over a total. A Sankey also shows where the money comes from and can have several levels, such as income to categories and categories to subcategories.
Can you make a Sankey of net worth instead of spending?
Yes, with assets on the left and debts on the right, although for net worth a curve over time is usually more useful.