couponqueenofcorning

Recently, I wrote a post about how to do a budget. You can read that post here . It occurred to me today that I did not discuss those expenses that do not occur monthly. These are things like car inspection, car registration fees, any household maintenance you do on a regular basis, and of course, gifts. These are very important to take into consideration when doing your budget.

Many experts suggest that you set up another savings account just for these types of expenses. You can go to ING and set up a savings account, where you can have many sub-accounts. For example, I have a savings account and two sub accounts there. One that is called Christmas Fund and the other is the House Fund. In order to figure out how much I need to be saving out monthly to go into the accounts, I divide the amount of the expense by the number of months left until that expense will be occurred. So, for example, if I know my car inspection is coming up in July (about 6 months or so away), I will take $30 and divide by 6. So, I need to save out $5 a month and put it in the account for that purpose. In order to track what money I have intended for what expense, I use a spreadsheet. Then when I pay it in July I can figure out how much per month using 12 months. So, $2.50 a month goes in to my savings per month for car inspection expenses.

If you have an account for those expenses that do not occur monthly, you will be prepared and will not need to dip into your emergency fund or, worse yet, use a credit card.