If you really want to know where your money’s going, it’s best that you start with a budget. You can either create one using the old-fashioned pencil and paper method, or you can set it up with an online budgeting service such as Mint.com. But even if you’re carefully preparing for your monthly costs, some of life’s expenses are harder to predict. Let’s look at 10 of the things that you should definitely be budgeting for but probably aren’t.
There are some great benefits to owning a home, but there are also some expenses to be considered. According to HSH.com, you can expect to pay 1% of your home’s total value in maintenance and repairs each year. For instance, if you had a $100,000 house, you will probably pay $1,000 annually in repairs.
Keeping your house in top-notch shape will not only keep you and your family safe, but it also helps you preserve the value of life’s biggest investment. Don’t forget about the big three: water heater, furnace and roof. Take their age and condition into consideration when planning out your budget each month.
I don’t know about you, but this one sneaks up on me every summer. They call it wedding season for a reason. First of all, it’s never just a single wedding. There’s always a string of six or eight in the month of June. Whether you are in the wedding or a guest, you have to worry about paying for the travel, the food and the fancy clothes, but you’re also expected to give a gift to the happy couple (two gifts if you’re going to the wedding shower). If you’re as clueless about how much to spend as I am, this helpful article will give you some ideas for how much to spend on a wedding gift.
It’s easy to think about our own medical expenses, but we often forget about the lifetime expenses involved with caring for our four-legged friends. For instance, the average insurance cost of a medium-sized dog over its lifetime is $6,565, while your average cat costs a whopping $7,713. One good way to mitigate these costs is with pet insurance, but you should also be saving up for these expenses. Be financially ready for annual trips to the vet, vaccinations, as well as regular expenses like pet food or litter.
Giving to a charity or a house of worship is a great way to use your money, but make sure you keep track of these donations. If you’re giving on a regular basis, set aside a specific amount each month. You may even want to save a little extra for unexpected opportunities to give.
For some of you, this isn’t a problem. You know and expect to buy clothes every now and again, and you budget accordingly. This one is targeted at the people who hate shopping for clothes and rotate the same five outfits from week-to-week. If you fall into that category, come to terms with the fact that you probably need your clothes to look professional, and sometimes that means taking a trip to your local mall (or at the very least, check out some great deals at a secondhand store). According to the Bureau of Labor Statistics, in 2014 the average American family spent $1,786 annually on clothing, so make sure your budget is adequately prepared to take on the cost of your new threads.
Paying for car insurance and the weekly/daily trip to the gas station are easy to plan for because we expect these costs on a recurring basis. But preparing for unexpected auto repairs is a little more difficult. Our vehicles begin to break down over time, and something like a failing transmission can take a hefty chunk out of your checking account (you’re easily looking at $1,500+ to replace one of those). Start setting aside cash for automotive repairs every month. Even if you don’t have bad auto luck, and that money just accumulates in your bank, you’ll be able to save up for your next car. There’s nothing better than paying cash for your next ride!
I always forget about haircuts when I put the monthly budget together. They feel so far away until the day I just wake up, walk to the mirror and some kind of mad scientist with a mullet/Afro is staring back at me. It’s never expected. A little extra planning will do wonders for this one. Keep track of your personal care expenses (haircuts, toothpaste, waxing, etc.) for a few months and see if you can find any trends. You’d be surprised how many of these “unexpected” personal care costs can be budgeted with the right preparation.
Let’s not kid ourselves — snacks are just as important as anything else on this list. My wife has made it a point to remove all the preservative-filled, hormone-stuffed goodness from our cabinets, leaving nothing but organic vegetables and meat that was butchered from free-range cows with hobbies. Never in my life have snacks been more essential. And we don’t always budget for them because they’re not the essential breakfast, lunch and dinner meals that we need to survive. Give your budget some wiggle room when it comes to the granola bars, apples and veggie sticks (and the Oreos that I hide in the back of the fridge).
Subscriptions and Memberships
First of all, take some time and write down all of your subscriptions and memberships, as well as the monthly costs associated with them. Subscriptions under $20 or even $10 don’t feel like much, but they quickly add up when you lump them all together. Before you budget for these expenses, take a hard look and cancel the ones you don’t need or use (I’m looking at you, gym membership). Once you’ve done this, add up the subscriptions and memberships you can’t live without and put those expenses in your budget. Depending on the situation, some subscriptions are tax deductible.
It’s important to leave some room for fun money in your budget. We should note that this doesn’t include your regularly planned entertainment or dining-out budgets. This should be money that’s set aside so that you can enjoy some of life’s best coincidences. It doesn’t have to be a large amount of money – my wife and I give ourselves $40 a month – but it gives you the freedom to be a little spontaneous. Let’s be honest, you’ll probably end up spending money on fun events anyway, so it’s good to have a little padding in your budget.
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