In order to pay off debt and better manage your money, budgeting is key. You can’t be successful in your finances by winging it. Your budget is the lifeline of your finances. And it doesn’t just require planning for the week or month ahead. It also requires pre-planning. Knowing what charge is coming up way before it happens helps you better prepare your finances ahead of time. That’s where many people trip up. All of the items listed below require preplanning and awareness. You must be aware of your past charges, your current, and your future charges to be able to budget every dollar. Each of these fall into a specific category.
Aside from travel expenses, most of these things typically fall into the “fun money” category of one’s budget. This category is usually the “leftover money” that you can use however you want. It’s the money left after you budget for all of your needs: mortgage, car payment, utilities, food, etc. But putting all of the leftover money into one category is dangerous. You can easily go over if you don’t budget every dollar. That’s why each of these costs fall into a specific category instead of just “fun money.”
#1 Coffee runs. Ok, yes. Realistically, you should cut these from your budget altogether if you are aggressively trying to save money and/or pay off debt. Why pay for coffee when you can make it at home? I get it. However, sometimes, you just need a good cup of joe that doesn’t come from a Keurig. Most times, you should avoid coffee runs, but sometimes, they are necessary for catching up with a friend or meeting a colleague to talk about work. If that is the case, budget a few bucks for these kinds of coffee runs.
#2 Dining out. Again, you should avoid eating out as much as possible. Nothing eats away at a budget more than eating out all the time. When preparing your budget, take a look at the weeks ahead. Are there days you know you are going to be home late or just too tired to make a meal? Are you going to even be home to prepare dinner on certain days? If so, make sure you budget for those instances.
#3 Gifts. Do you have any family or friends celebrating your birthday during the time your budgeting for? Make sure you have money for that gift! If you are going to go in on a gift with other people, make sure you make it clear the maximum amount you’re willing to spend. Want to go the handmade route because it is cheaper? Consider the costs of the supplies you will need.
#4 Party supplies. You may not have to bring a gift to a party, but will the hostess ask you to bring something to contribute? Appetizers, napkins, and party decor may be some of the things requested. Or, the party may be BYOB: bring your own booze. If it’s a housewarming party, you may want to bring a bottle of wine or flowers. Check in with the host ahead of time to see if you need to bring anything or ask other attendees if they’re bringing anything.
Health and Beauty
#5 Doctor visits. Unless you have amazing health insurance, chances are you will at least have to pay a co-pay. If you have a doctor’s visit scheduled, make sure you have money to cover the costs. The best action to take is to research your health insurance plan and talk to your doctor. Find out ahead of time if your doctor accepts your insurance and if your visit (and/or procedures) will be covered.
#6 Beauty services. It can be easy to forget to include a haircut, wax, or pedicure into your budget since you don’t get them done every week – or even month sometimes. When you’re planning your weekly or monthly budget, see if your due for any beauty maintenance, then budget accordingly.
#7 Toiletries and makeup. We typically use our toiletries and makeup until thy run out. That can make it hard to plan for when you will need more of something. Check your shampoo bottles, toothpaste tubes, and makeup supply regularly. That way, you will know ahead of time when you will need to restock.
#8 Kid’s fundraisers. Between my cousins, nieces, and friend’s kids, I’ve probably spent hundreds on Girl Scout cookies, pizza kits, and candy bars throughout the years. It’s hard to say no to kids, so save some money in your budget to buy a box or two, just don’t go overboard.
#9 Donations. After the first week of a new president, requests to donate money to a number of different causes filled my inbox. It’s hard to accept you can’t afford to change the world on your own. And the number of various crises happening right now is overwhelming. My best advice: pick one or two that mean the most to you and focus your time, energy, and money on those. It’s important to remember, a little can go a long way. So don’t feel like you have to donate a ton of money. Do what you can and what your budget will allow. You can make up the difference in volunteering your time or helping another way.
#10 Car maintenance. Oil changes, tire rotation, and other routine car maintenance are not situations you should draw from your emergency fund. Car accidents, engine trouble, and flat tires are. Check your documents for the mileage or date your car is due for an oil change or tune up. Then, plan your budget accordingly.
#11 Public transportation. If you take public transportation regularly, chances are you have a monthly pass. Make sure you know well in advance when you need to renew your pass. That way, you won’t have an expected cost when you need it most.
#12 Extra driving. If there’s time you’re driving farther than normal, bump up the amount you budget for gas. Planning on visiting family that lives three hours away? Chances are you’ll be needing more gas than you usual trips to and from work.
Pending Charges and Renewals
#13 Amazon Prime and other subscription renewals. A close-to-$100 payment may not seem like a ton of money at the time you decide to get Amazon Prime membership. Just remember that you have to renew it every year. It can seem way more expensive when it comes time to renew it and you aren’t ready for that kind of charge. The same goes for other subscriptions. If they are automatic renewals, make yourself aware of the renewal date. Give yourself a heads up a week or month in advance so you can prepare. Be weary of free trials too. Many of them ask for your credit info upfront to automatically charge you when the trial period is up. If you don’t unsubscribe before then, they will charge you.
#14 Charges that haven’t cleared. This one has gotten me more times than I’d like to admit. Look at your bank accounts to see if there are charges that have yet to clear from your last budget. This could include gas (some stations only charge $1.00 until it goes through), restaurants (tips are not included on the charge until it goes through), and online payments. Be aware of your automatic payments too. They make bill paying easier, but their ease may make them easy to forget. If you forget you have a $100 payment set up, it can be devastating to your budget once it goes through.