There are a million things to think about it when it comes to planning your yearly spending. From groceries to rent and electricity, it can be difficult to think of all the expenses you need to anticipate.
To help you cover all of your bases, I’ve come up with five different categories that you might have accidentally skipped in your planning session last January. These are expenses that almost everyone encounters, but many of us forget to plan for them and are surprised when they pop up. Don’t let these things be the tipping scale that ruins your carefully planned budget.
1. Your Car Maintenance and Registration
If you drive a car, then budgeting for vehicle maintenance is a must. According to CAA, just your regular car maintenance can be as much as $800 a year, and that’s assuming you don’t have any serious problems to address. Heaven forbid you to need to change your tires or buy new brakes.
Consider setting aside roughly $50 a month in a separate savings fund marked “car expenses.” That way, when it’s time for your oil change or any other expense, you’ll have a nice nest egg to draw from to cover the cost if you don’t have room for it in that month’s budget.
Also, remember that you’ll need to have your car inspected and registered every year you own it. That’s about $100 extra dollars you’ll fork over during at least one month. Either schedule that payment in your budget ahead of time so you’re not taken by surprise or add a little bit extra to your car expenses savings account.
2. Annual Fees From Credit Cards and Subscriptions
Depending on which credit cards you use and how many you have, you might need to pay hundreds of dollars in annual fees. That doesn’t mean the cards aren’t worth it, but you certainly need to plan to accommodate those fees ahead of time.
In that same vein, think about the various memberships and subscriptions you’re a part of. If you only pay on a yearly basis, it’s easy to forget about the expense until it pops up on your radar. No matter how big or small the fee may be, make sure it has a place in your annual budget so that you can be prepared.
3. Birthday, Wedding, and Christmas Gifts
Did you know that, during the holiday season, the average American spends $700 on gifts and goodies? If you haven’t made room for that in your budget, you can easily go overboard buying presents for your friends and loved ones. Many people wind up facing credit card debt in January after the holiday season ends, and that’s a terrible way to start the new year.
My suggestion is to do the same thing as you do with your car expenses: create a savings account that you contribute to throughout the year. If you put about $50 away every month, by the time December rolls around, you’ll have more than enough to cover most of your holiday expenses.
The holiday season isn’t the only gift-giving occasion to plan for. Think about family birthdays, weddings you’ll attend, and any other big presents you’ll need to purchase. The more you can prepare, the less dramatic those expenses will seem when they roll around.
4. Tolls and Gas
Depending on where you live, you might spend a substantial amount of money on toll roads. Those small trips may seem insignificant, but over the course of a year, the small fees can add up. Look at your toll account from last year to see how much you spent and fit that amount into your budget for this year.
According to the US Energy Information Administration, the average American resident can spend anywhere from $400 on gas annually to more than $1,300. It all depends on where you live, so although I can’t tell you how much you need to budget for gas, I can tell you that you should. Figure out what your monthly average is and try to pay attention to how accurate that has been this year.
As you can see, many of these things are the expenses we think very little of. Gifts for friends? Just swipe the credit card. Toll road fees? We barely even acknowledge those. Vehicle expenses? Just hope the car keeps running.
Over time, these costs can all add up, throwing your budget off course. Try to incorporate them in your budget ahead of time so that nothing takes you by surprise. After all, you’d rather be over-prepared than under-prepared.