There's a common challenge that we all encounter – Known, Upcoming Expenses. Those expenses that creep up month after month, those anticipated yet sometimes overlooked financial obligations. Here’s how you can start saving for known, upcoming expenses:
Identify Your Known, Upcoming Expenses
Here are a couple of common expenses that people have:
Car tires need to be replaced
Heating & Air goes out
Christmas
Vacation
Birthdays
Anniversaries
Life insurance premium
Property taxes
Health Insurance Deductible
Create a list and track the known, upcoming expenses in your household. Name the expense and the month in which it will occur.
A great tool to help you with this financial planning exercise can be found HERE. Create your free account and access the Known, Upcoming Expenses Calculator.
Automate Your Savings
The best way to plan for known, upcoming expenses? Save for them!
Create separate savings allocations for each anticipated expense. Whether through dedicated bank accounts or labeled cash envelopes, ensure that your funds are earmarked for their intended purpose.
Also, saving doesn't have to be an active task! If your bank account has the ability, consider setting up automatic transfers to your designated savings accounts for known upcoming expenses. This not only eliminates the temptation to spend but also establishes a consistent savings routine.
Managing your known, upcoming expenses is not an art; it's a learnable skill. By identifying your expenses, planning, and maintaining a savings approach, you position yourself to navigate without worry!