This post may contain affiliate links. Please check out my disclaimer for more information.
Getting on a budget is absolutely essential for your financial well-being. There is no better way to keep track of how you’re spending the money that you make. Budgeting helps you prioritize the things that you really need to pay for, and the things that you want most.
But even pro budgeters sometimes miss things that should be in their budget. In this article, I’m going to walk through 15 things that are commonly missed when putting together a budget. Make sure you’re budgeting for these expenses!
Retirement is a difficult subject for many of us millennials. It’s tough enough to budget for everything in life and then you add retirement in on top of that. It can be really discouraging. We save less than we’re ‘supposed to’ for retirement but you know what? Something is always better than nothing! I’d rather retire with 200k than nothing!
How to make saving for retirement easier:
- Decide how much you can afford to save and have the contributions made directly from your bank account weekly or monthly.
- Take advantage of any matching programs offered by your employer.
You may also be interested in:
Extra debt payments
If you want to get out of debt (and really…who doesn’t?), you need to be making extra payments. Even a small amount every week can add up. Why not budget $50 or $100 per month specifically towards extra debt payments? You will pay down your credit card/vehicle or what have you much faster.
How to budget for extra debt payments:
- Making smaller payments more frequently can be easier to manage than paying large sums all at once. It adds up quickly!
- To avoid the temptation to spend the money, make the payment as soon as the money comes in!
- Keep a running tally of the balance of your debt to stay motivated. Make sure to focus on how far you’ve come!
We pay for insurance on two vehicles at the moment. One is paid annually and one is financed monthly through our insurance provider. This expense pops up every year and you can usually save money by planning ahead and paying for your car insurance annually.
How to save money on car insurance:
- Shop around. Sometimes you can get a better rate just by switching providers
- Take advantage of discounts. I get a better rate by agreeing that nobody with less than ten years of driving experience can drive my car.
- Ask about other rate breaks. Some providers offer discounts for things such as anti-theft systems.
Most manufacturers recommend changing your oil every 5000-10000 miles. This expense will come up whether you prepare for it or not! There are many other maintenance items that will come up regularly. Make sure you have cash set aside for this.
How to save money on vehicle maintenance:
- Learn to do simple repairs yourself
- Find a mechanic that you trust
- Treat your car well, and it will treat you well
For the last few years, I have started putting money aside for Christmas gifts at the beginning of the year. Well technically, we have a ‘gifts’ account that is used for both birthdays and Christmas but the money is there when we need it! You don’t need to put much away, for us, $50/month is plenty.
Ways to save money on Christmas:
- Buy your kids a larger experience rather than many small toys
- Give a larger gift to all of your kids, rather than a bunch of smaller gifts
- Avoid impulse purchases by writing out a gift plan and sticking to it.
A great way to avoid overspending on birthday gifts is to add it as a line item on your budget. Decide who you want to buy for over the year and how much you want to spend on each. Add that up and divide by how many pay periods you have in a year and boom. You’ve just budgeted for birthday gifts.
Some people (myself included) don’t have to worry about property taxes as it’s built into my mortgage payment. If you don’t have this option and instead pay annually you should be setting aside money each month so that you have enough to cover your taxes when they’re due!
Home or Renter’s Insurance
Depending on your situation, you may be required to carry homeowners or renter’s insurance. Even if it’s not required, it’s a good idea. This is typically an annual payment and it makes sense to save for it weekly or monthly so you’re not caught off guard when it’s time to renew.
If you have medications that you take regularly and aren’t covered by an employer’s health plan, you should be adding the cost into your monthly budget.
Nobody likes visiting the dentist, but we all do it right? It’s a good idea to budget in a semi-annual or at least annual check up and cleaning to keep your teeth in good shape. Tip: not al; dentists charge the same for these services. If money is tight, it’s worth calling around to make sure you’re getting the best deal.
I don’t know anybody who doesn’t eat out at least sometimes. Whether you like to treat yourself to a nice steak dinner once per month or buy your lunch out everyday, you should add this as a line item on your budget to make sure that you know how much you’re spending on eating out every month.
Crap happens, and rarely when you want it to. Furnaces fail, water heaters leak and car accidents happen. If you don’t have a healthy emergency fund already (1-2 months take-home income is a great start), consider putting away some cash from every paycheck until you get your emergency fund to a point where you could handle smaller emergencies such as an appliance failure without much disruption to your life.
The healthier your emergency fund the better, and it’s a good goal to work up to the point where you could get by for 3-6 months if you lost your job unexpectedly.
I wear clothes, and I bet you do too. Make sure to include clothes in your budget. Consider major things that you’re going to need in the near future. Expensive items like winter coats, work boots and dress clothes for weddings can creep up and throw your budget off. A great way to make sure you have some cash when you need it is to start a specific account just for clothing. My wife and I each have one.
It’s one thing to plan on taking a holiday, and it’s another entirely to put money aside for it! Make sure to budget some cash so that you have the funds when it’s time to get away for a while.
Having a ton of line items on your budget can be a little overwhelming. To make budgeting simpler, consider combining similar expenses into one line item. For example, car insurance, gas and repair can all be combined into simply ‘vehicle expenses’. This can help ensure that you don’t get overwhelmed by too many things while trying to stick with your budget.
Question for you:
What unique or odd thing do you budget for?