If you’ve read any of our articles you know that we believe that creating a family budget is critical to effectively managing your finances. This is especially true if you want to get out of credit card debt, since you need to be sure that your expenses don’t exceed your income. Unfortunately, many people create a budget and think everything is fine and then when the end of the month rolls around they still are “short”. This is often the result of “missed” expenses. Here are a few financial costs that are often overlooked:
Healthcare
All sorts of healthcare items can appear throughout the month. You may pay insurance premiums right out of your paycheck. However, when you go to the doctor, the dentist, or anyone else, you likely have to pay a deductible or co-pay. This can add up considerably throughout the year. In addition to office visits, you may have prescriptions, vitamins, and other supplements. It’s best to add all of this as a line item to your budget so that you can account for the expenses more appropriately.
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Personal and Pet Care
Personal care should be a top consideration when you draft your budget. You and your family likely go to get haircuts monthly (or every other month). If you don’t have this included in your budget, it can be a shocker when you need to pay for them. Other personal care may include massages, visits to the nail salon, trips to the department store makeup counter, and more. If you can afford these items, don’t feel guilty about including them in your budget. It’s simply important to account for them. And don’t forget the cost of feeding and caring for your furry friends as well.
Vehicle Maintenance and Home Repairs
If you own or lease a vehicle, you want to make sure you are maintaining it properly. Otherwise, you may end up spending a lot more in order to replace it. Oil changes should be included in your budget because they will need to be scheduled periodically. Other vehicle maintenance can include new tires, trips to the car wash, detailing, and more. If you own your home there are always maintenance expenses and they usually cost more than you expect. Costs include everything from gas for the lawn mower to a new water heater or roof. Even though you don’t replace the water heater every year they generally only last from 8 to 15 years so you should set aside 1/8th of the cost of a new water heater every year so when the expense arises you will be prepared. The same is true for a new roof your budget should include 1/25th of the cost of a new roof as well.
Gifts and Special Events
When you’re creating a budget, you have to remember all of the ‘surprise’ items that can appear from time to time, too. Gifts include birthday gifts for your family members, obligatory gifts when you’re invited to a wedding or baby shower, and more. It’s best to budget at least a small amount of money every month so that you’re prepared when you get an invitation. Don’t forget the cost of hosting parties, children’s activities and road trips.
When you factor in more of the expenses that you are likely to incur, it will lead to a more accurate budget. You will be able to focus on adhering to the budget when you don’t have surprises happen each and every month.
You might also like:
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- Financial Hard Times: How to Pull Your Family out of Debt
- True Cost: How to Calculate the Financial Needs of Your Family
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- 5 Tips for When Money is Tight
- Budgeting Your Family Finances- The Jars Method
- The Frugal Guide to Building Wealth
- 8 Ways to Save on the Cost of Child Care
- The Wealthy Buy Assets, the Poor Buy Liabilities, and the Middle Class Buy Liabilities Believing They Are Assets
