Posted on: Jul. 22, 2017 in Money

When we talk about budgeting, we generally talk about money in and money out. Most articles and resources, even this one, will recommend that you add up all your fixed monthly expenses, do your best to estimate the flexible ones that make up your discretionary spending, and then subtract all that from the total income you collect each month. If you still have money left when you’re done, you’re all set.


But not so fast. While this is the simplest type of budget, it does leave out one very crucial type of expense: the irregular expense.

Irregular expenses are those things you know you’ll definitely need to spend on at some point in the future. It could be something you can plan on such as holiday gifts, vacation, or birthday parties for the kids. It can also be the new brakes you know you’ll need soon or the new dishwasher since yours has definitely been acting funny lately. It’s your quarterly taxes for your freelance work.

These expenditures are necessary, but sometimes hard to predict. When you can plan for them, like holidays or birthdays, it can seem like there so far off and you have plenty of time for them to come around. When you don’t know when the car will need work or the appliance will finally break down, how can you make sure you have enough money for it.

One thing you can do is have an emergency fund. You’ll want to set aside a minimum of $1,000, though having three to six months of expenses set aside is better. When something comes up, it’s good to have the money on hand to pay for it.

However, an emergency is technically something sudden and unexpected. All these irregular expenses we’ve been talking about? They should have been expected. You knew they were coming eventually. Dipping into your emergency fund to pay for things you could have planned for means you won’t have the money for a true emergency like a sudden trip to the emergency room.

Instead, consider making one of your fixed expenses to pay yourself. A new car fund, a new dishwasher fund, vacation, holiday, you name it. Whatever expenses you know are going to pop up, put some money away for them. Even if you can’t save all that you’ll need, every little bit helps and keeps your emergency fund intact.

If you’re ready for a new car but your credit is keeping you from getting approved, CreditYes can help with our bad credit auto loan program! We can match you with a dealership in your area that will be with you every step of the way. Our service is fast and free. Fill out our secure online application and get behind the wheel of your next car today!