Long time, no blog! It’s been a while since I posted on my blog, but I wanted to let you know that the system I put in place at the beginning of the year is working well!
I wanted to be one month ahead in all my bills– that is, the paychecks I earn in June will cover all my expenses for July. Last year, I was still allocating a certain amount to cover a range of non-monthly expenses (such as Christmas gifts and club dues that are only paid twice a year), but I didn’t physically move that money into another account as savings. It just stayed in my main account and theoretically I’d have enough in there to cover any non-monthly expense that popped up. The trouble was, these expenses aren’t all on the same schedule, and paying for my professional certification maintenance or cat’s medical expenses wouldn’t happen all at the end of the calendar year, so it wasn’t certain that I’d have enough saved when each of them needed to be paid.
So, starting after Christmas I would transfer that amount, along with regular savings toward an emergency fund, into a separate account. The money in that savings account is for both non-monthly expenses as well as emergencies. Currently, that account has enough money to cover three months’ worth of my regular living expenses (not counting any personal savings contributions, but still including life insurance and retirement contributions).
This month we’ve got one cat’s annual checkup and vaccine booster, and we need to stock up on the monthly drops we put on our two cats so they don’t get fleas/ear mites/other nasty bugs. So if that amount is more than my monthly contribution to the non-monthly expenses (which is $107), then I’ll transfer the difference from my savings account back into my regular account to cover it. This system of being one month ahead on bills, and non-monthly expenses transferred to a separate account so they don’t comingle with my regular balance, makes a lot of sense for me!
How is your budget working out for you? Let me know if you have any questions about budgeting in the comments below and I’ll be glad to chime in! 😀