Creating a budget is never easy, as it can take months or even years to perfect the process. And on top of that, life is always changing so a budget that worked a few months ago might not necessarily work now.
In fact, even the most detail oriented person often have a hard time creating a budget that works. If you overspend and the budget fails, it isn’t necessarily for a lack of trying.
One of the most common reasons people find budgeting so hard is because there are so many different expenses to keep track of. The big ones, like housing and food, are obvious. But there are so many little things we forget about that can derail a budget from the start.
The next time you evaluate your budget, consider these six expenses that people often forget:
1. Celebrations
It seems like every week, we’re always celebrating something. From birthdays to weddings to holidays, our schedules are jam packed with these social events.
However, we often forget that these celebrations come with hefty price tags. Gifts, travel costs, and party attire can add up quickly. Not accounting for these items can really throw your budget off.
For example, if you know you have a few weddings coming up in the next year, make sure to set aside funds to cover any associated costs. Also be sure to increase your budget during the holiday season to account for gifts and travel.
2. Pet Care
We love our pets, but there’s no denying that caring for them gets expensive. We tend to only think of pet care expenses in terms of things they use everyday, like food, but any pet owner knows that there are many other major costs associated with our furry friends.
Health care, including regular veterinary visits, are a big one. Grooming and pet sitting is another. These are expenses for your pet that may not happen every month but they’re regular enough that you should include them in your budget.
3. Coffee
Any good budget will include a category for food and dining, but don’t forget to include your coffee in there as well. We all know how much a cup of coffee can cost – anywhere from $2 for a regular cup to $6 for a latte.
It’s something many of us can’t live without and it definitely adds up. Whether you make your own or go to your local Starbucks, make sure you understand how much you’re really spending on your coffee addiction every month.
4. Home Maintenance
Owning a home is a dream to many, but when that dream finally comes true, many first-time homeowners are unpleasantly surprised by the cost of home maintenance. Aside from utilities, and minor repairs, there are many recurring expenses, such as lawn maintenance and weather proofing that homeowners forget. Expenses like these drive up the cost of owning a home considerably.
5. ‘Me’ Fund
When we’re trying to stick to a tight budget, we often forget about ourselves. If you’re trying to cut your budget, spending on things we enjoy is likely the first expense to go.
Don’t underestimate the value of having a ‘me’ fund, though. It can be anything, from a night out or a pedicure, but doing even something small from time to time can drastically improve your mood and increase your productivity.
6. Emergency Fund
The one thing people most often forget to account for is an emergency fund. This is also the most important. With all that’s going on, saving up for a rainy day is probably the last thing on your mind.
But as with life, you never really know what can happen, and you need an emergency fund to protect you from whatever life throws your way.
Your budget should include a portion to set aside for emergencies. Many recommend that you have 3 months of expenses on hand at any given moment. You can decide the amount you’re comfortable with and slowly save up for it. Just remember to make this a priority.
David’s Note: You can also account for the easy to forget expenses by looking at last year’s budget to estimate this year’s outlay. For instance, our family always spends quite a bit more during the summer months due to kids being out of school and also during December when we donate more to clarities, pay property taxes, and buy gifts. By looking at the total, you don’t have to remember every single expense you’ll need to budget for because you have a general idea of the total amount of money you can spend.
What is one thing you often forget to budget? Let us know in the comments below.
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Cutting out eating out often and eating healthier can reduce budget expenses. That’s what you call “doing the transformation business work out of inspiration or desperation.” 🙂
I am probably repeating myself but to me it is pure common sense . A high number of pathetic Fools only know how to spend , spend , spend . The word ” saving ” is not in their vocabulary . Hey , lets live the Good Life today , tomorrow is far down the road , so why worry . Interesting that even those who earn HIGH salaries , some of them spend , spend , spend and once retired live like poor White trash . ” A Fool and his money are soon parted ” I have always asked for a receipt no matter what I purchase and at the end of the month I total everything up . I have a 1 year chart, January thru December listing assorted expenses such as Supermarket , Drug Store , Auto gas , restaurant dining , post office , travel , entertainment , repairs and maintenance , Beer / Liquor , travel , clothing , etc. Many people eat out often but when you compare the cost , it is a wake up call . A cocktail at home costs about 90 cents compared to a restaurant where the same drink costs about $ 8.00 to $ 10.00 . A meal in a restaurant would cost about $ 12.00 to $ 20.00 + + compared to the same meal at home …..salad , meat , vegetable , potato costs about $ 4.00 . Multiply that times 3 or 4 times a week X 52 weeks X 40 years and you will have thrown out a Fortune . I eat out about 2 or 3 times a month at best. The money saved is like ” seeds ” that you plant , the seeds eventually become trees that bears fruit for years on end . With cautious investing , it will grow and often you get a return on you original investment [ 3 % – 4 % ] which when reinvested earns money . That leads to compound interest . Einstein Quote – ” Compound interest is the 8 th wonder of the world . He who understands it , earns it . He who doesn’t pays it . ” The interest you earn …. earns interest . [ Free Money ] Some Idiots say , ” It ain’t fair ” They brought it on themselves because of the lack of education and the lack of drive . Put in the effort and you will succeed . A trade such as an electrician , plumber , carpenter , etc. pays a high salary . Those who go to college often are indebted for the next 15 to 20 years . Opportunities abound if you are willing to put in the effort . If you are looking for ” sympathy ” , you will find it in the dictionary between syphilis and shit . Arminius Aurelius
I splurged a bit this year so I need to chill on spending on the “Me $ gUaP $.” 🙂
“Celebrations” is a good one and often missed. Crazy that it is skipped so much – Christmas, birthdays, and holidays happen every year. You’d think we would all account for them in our annual budgets.
What I usually do is to have a broad category for my expenses. With that, I don’t need to go to the minutest details of what the expenses are for.
Very true. For me, the celebrations and home maintenance are the most unpredictable expenses. Sometimes you get invited to dinner at a restaurant where you’ll split the bill or to a house party where you have to bring something. At home, things can unexpectedly break or stop working, leading to big repair bills.
I think that, over time, you can figure out how much you tend to spend on these items, but they’re certainly somewhat unpredictable.