Irregular and non-monthly expenses are budget busters. Successful budgeting requires that you take into account all your expenses, not just your normal monthly expenses.
Non Monthly expenses can be classified as any predictable expense that is paid other than monthly.
- Many Insurances are paid quarterly or annually.
- Property Tax and Vehicle Registrations
- Back to School clothes and checkups
- Christmas and Vacations
- Pet checkouts and vaccinations
Irregular Expense are those that both the timing and the amount of the expense are hard to predict
- Repairs and maintenance of the house, the car
- Medical Expenses
- Vet Bills
Although we may be unable to predict the exact amount or due date for an irregular expense, we know that they will occur. Stuff breaks, people and pets get sick, babies are born and roofs must be replaced.
To handle both irregular and non monthly expenses use sinking funds. Sinking Funds are basically just named savings accounts. Start by making a list of all your expenses that occur non-monthly with the amount and the due date. Now make a list of irregular expenses that you can expect. To help you build your irregular expense list, think of everything you own that will need to be replaced or repaired.
How long will you keep your car ? Let’s say you are willing to keep your car until it has 150,000 miles or for about 10 years. If you’ve already had it 5 you need have 5 years to save up enough to buy a replacement. Decide what you will be spend for a replacement, let’s say $12,000, that means you need to put $200 a month into your car replacement sinking fund starting now.
Here’s a detailed example of how to set up and use a Sinking Fund.
It’s the time of year that we all throw open our windows and freshen our homes with a little spring cleaning. This year let’s do it with our shiny new budget in mind.
De-cluttering often reveals that have we purchased multiple products to do the same function or that we have several of the same product. This year as part of your spring-cleaning, take everything out of your cleaning supply cabinets and inventory it. How many cans of pledge, bottles of Febreze or boxes of Swiffer refills do you need? Is it necessary to buy one product for the countertops and one for the microwave and one for the floors?
When we replaced our windows years ago, the installer recommended cleaning them with a mixture of 10% cheap white vinegar 90% water with a bit of Dawn detergent if they are really dirty. This same concoction works great on our bathrooms and counters and floors (just not marble). One spray bottle, multiple uses, cheap easy and effective.
Resolve not to buy any new products until you have used up the old. Make an actual list of what you have. You might find you can make it through the summer without buying any new cleaners. There’s some snowflakes for your snowball.
Hopefully, by now you’ve completed your taxes. How did you do on your withholding last year? If you’re getting a large refund you may be having too much withheld. If you had to write a sizable check maybe you need to withhold more. See your Human Resources representative and try and match your withholding to your taxes paid.
While your visiting HR, now is a great time to ask if you can have your direct deposit split between two accounts. Many companies are more then happy to do this for you. Have the money you need to save for irregular expenses like car repair, insurances or taxes that you pay annually and Christmas gift giving deposited to your saving account before you ever get your check.
Gas prices are up. Resolve today how you will handle this in your budget this month. Here’s an article to help you.
Don’t Let Rising Gas Prices Bust your Budget
St Patrick’s Day is the 17th. Are you going out? Make sure you set aside funds for your evening of green reveille. Use cash to stay within your budget.
Make March your Check my Subscriptions Month. Take an hour sometime this month to evaluate each of your subscriptions. Netflix, Audible, Magazines, Cable, Cell, Internet etc. Are you getting you money’s worth on each? Can you easily live without one or more? Can you renegotiate a lower prices or select a less expensive plan?