Budgeting can be difficult at times. Some don’t see it that way. They just put out a budget every month that is exactly the same as any and every other month (what Dave Ramsey calls “the perfect month from heaven”). When we really stop and think, though, we all know that no two months are exactly alike. What are Gotcha Expenses? Even knowing that, however, there are some months where we have “gotcha” expenses. These are the times in the year when we have to pay annual dues, or for a semi-regular (but quite expensive) service. Here are some examples that my wife and I have to deal with throughout the year. HOA dues Dentist visits Life insurance premiums Christmas Wedding anniversary (you don’t want to forget that!) Trips (both personal and ministry-related) There are others, of course, but these are quite common to a lot of people. Most of us don’t spend or pay for these monthly. In fact, on some items (e.g., insurance) the amount you spend is reduced if you don’t pay monthly. So, by making these things less regular, you are helping in the long run. But, sometimes, the budget can get very tight when the payment for these items comes due. Budget for the Gotchas! What, then, can you do to be ready for these budget “gotchas”? Here are 4 things to consider. 1. Save monthly for some. The old-fashioned “Christmas accounts” at a local bank were there for a reason. There are some things that are quite easy to save for. My wife and I put money away each month for Christmas, for example. We do this for a few reasons. If nothing else, Christmas never moves on the calendar! Also, though, by having that money at hand, we can jump on a good deal earlier in the year if we know what someone might want. We put the money away in cash in an envelope throughout the year. If you don’t trust yourself as much, open a special account, either online or at your local bank. Then, just have a small amount put in there each month. When December comes, you’ll be ready. 2. Use “extra” money. Most of these “gotchas” are things that we know are coming, and a vast majority are items where we know the amount well in advance. Instead of just blowing a bonus check or some money given for a special service, use that money to help pay for one of these. That way, it barely touches your budget, if it affects it at all. As a preacher, I am asked at various times to come and preach for one night. Often, the congregation is generous enough to pay a little money for these speaking times. My wife and I always try to do three things with this money. We give, we “pay ourselves back” for the expenses (gas, food, etc.) incurred, and then we plan to use the rest. Often, that leftover money goes to a “gotcha” item. 3. Set aside money for two (or more) months. What I mean by this is to set aside half the amount the month before something is due, and then the other amount the month it is due. For example, if your HOA annual dues are $300, why not budget $150 for two months (or $100 for three months if money is tighter), instead of trying to find $300 in a single month. Get that money in cash, and put it in an envelope until the time comes to actually write the check or call in the payment. This spreads out the large expense without making one month really hard to manage your bill payments . 4. Don’t incur late fees and penalties. Check and recheck the due dates on these categories. Often, late fees for dues and services are huge, and will make paying them even more of a burden. Some ofter a grace period, but only if you ask. The real key to handling these situations is to plan ahead. It is amazing to me how some people claim a “gotcha” on something that happens quarterly, semi-annually, or even yearly. Taking a few moments to look down the line will help ease the pain of paying for those larger items that can often destroy a monthly budget. How do you avoid or pay for “gotcha expenses?” Leave a comment below! Stepping on a banana peel image from Shutterstock Related Articles: 8 Ways We Dramatically Reduced Our Expenses This Month How Often Should You Review Your Household Budget Sheet? 15 Ways to Cut Your Expenses – GS2 How to track daily expenses Adam Faughn is a minister in Nashville, Tennessee. He is married to Leah and they have 2 children. You can check out his personal blog or follow him on Twitter .
4 Ways To Budget For “Gotcha” Expenses