budgeting article

[Megan]

Finally_Frugal, that's what I do too. I also just set aside money each month into a "other expenses" account - for car repairs, other unexpected things.

[72Tiger]

Originally Posted by Finally_Frugal

I use a 'hybrid' system, in which I budget monthly, but I add in the long-term expenses (like estimated tuition costs and auto insurance). I divide those estimated yearly amounts by 12 and include that amount in my monthly budget. So, for example, I save $133 in a sub-savings account each month to take care of future tuition costs. It works perfectly! The difficult part is estimating costs for things that occur irregularly, like auto repairs. I haven't quite figured this one out yet.

for auto repairs, I allocate an amount every month to build a fund for that purpose. If a repair comes around that costs more than what I have in the fund, I dip into my emergency fund, then pay it back from future months allocations to the auto repair fund. If I find myself dipping into the emergency fund too much, I know I should increase the monthly amount I set aside for car repairs. After a while, you get a better 'feel', and it becomes self regulating.