Yes, I’ve written a lot about spending and budgeting this first quarter. That’s because many people pick “be better with finances/money” as their New Year’s resolution. Today’s post will help those of you trying to stick to a budget, and those of you who hate budgeting to every penny.
For periodic expenses I am referring to things that occur annually and are paid either all at once, bi-annually and possibly even quarterly. Think of items like car insurance, life or long-term care insurance, personal property tax, and maybe even a vacation.
You know these expenses come due every year. But since they are not monthly like utility bills and the mortgage, many folks forget to include them in the monthly budget. The solution is simple! Total these expenses and round up by about 2% for inflation. Divide this amount by 12 and transfer that amount monthly into a separate, designated savings account just for these expenses. The money will always be there as long as you don’t raid this account for tickets to the monster truck show or a weekend spa treatment. Name the account something to reinforce the need for this money, like ‘Annual Necessities’ or some other moniker that is meaningful to you.
If you need a pro to help you, call me. As an independent Certified Financial Planner™, I can help you with a savings goal, debt reduction, examining resources available and figuring out which bills are periodic and how much money they require. #talktometuesday #savings #budget #education #Hireaplanner #savemore #payyourselffirst #budgeting #CFPPro