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If you’re already into budgeting and have drawn up a monthly plan that tallies up regular expenses, good for you. If you’ve also figured in miscellaneous items like entertainment, even better (saving is hard, but you should still be allowed a treat now and then). But are you tallying up everything?
Sometimes, we forget about these expenses that don’t occur every month. They may occur only every few months or once a year. If they regularly recur, however, they need to be figured into the monthly budget. These aren’t “surprise” expenses — you already know about them and not counting them can seriously mess up your finance plan.
Any of these can fall into recurring expenses:
- Termite bonding and inspection for homes
- Beauty salon treatments
- Oil changes for the car/truck
- Buying start-of-school supplies
- Pet checkups/grooming
- Dental visits
There’s plenty more out there that may apply to you individually, but the point is, many of us don’t factor these in to our monthly budgets because they don’t happen every month. Here’s where it can hurt you:
Say you haven’t factored in any of the above expenses. Using what I typically spend on these, here are my figures:
- Termite bonding and inspection for the year: $500
- Hair cut and color: $80; five times a year: $400
- Oil changes plus tire rotation: $50; four times a year: $200
- School supplies for two kids: $150
- Pet shots once a year: $100
- Pet grooming six times per year $45 each; over a year: $270
- Dental visit: $30 office fee (with insurance coverage); twice a year: $60
That’s $1680 over the course of a year or $140/month. If you’re on a strict budget that leaves no room for errors, $140 is a lot of money. Worse, what if an emergency happens and although you have some savings set aside, you’ve factored this money into that savings instead of factoring it into your monthly budget?
If you really want to know how much you spend every month, it’s important to figure in your recurring expenses. This way, you won’t end up one month wondering why you’re $60 “short.”