Cost to ConsiderMaking a budget can be really tedious. The first time I tried to create a budget, I used a resource I found online to figure out what categories I should use, but the list failed to include the other places my money was going.
In order for a household budget to work effectively, you need to ensure it encompasses things that actually have an impact on your finances. Many times people leave out important expenses, and, as a result, their budget is not accurate.
1. Convenience Spending
Convenience spending includes the things you buy on the fly. This may include the cups of coffee from the gas station every morning, impulse buys, and things you forgot at home but need throughout your day. The way to combat this is to track every single penny you spend for 2-3 months to get an accurate look at your spending. In a post on my blog about habits, I delve into this topic a little more: Your Habits are Making You Broke.
2. Pet Care
Pet care should account for basic daily items like food but also needs to be budgeted to include annual vaccinations, vet visits, emergency care, medications, and boarding fees/sitting fees if necessary.
You may be frugal throughout the year, but you likely buy at least a handful of gifts throughout that time. You should not only be budgeting for the holiday gift giving extravaganza in December but also be budgeting for gifts throughout the year for birthdays, "get well" sentiments, a new baby, office celebrations, or wedding presents.
If you actively participate in a hobby, you need to account for the money spent. This includes supplies, equipment, and other associated expenses.
5. Transportation Expenses
Besides the cost of insurance and gasoline, you should also include the annual costs of owning a vehicle. This will include basic maintenance, repairs, inspections, parking fees, traffic tickets, and other associated costs.
6. Child Care
Child care is not just the costs associated with babysitting, you also need to factor in the cost of school lunches, school supplies, field trip money, and other essentials you spend money on for your child.
7. Health Care
Medical care includes more than insurance costs and doctor visit co-pays. You also need to account for the basic health care things you spend money on like prescription and over-the-counter medicines, and basic medical supplies you buy for a sudden illness. Medical supplies like crutches, breathing machines, and other accessories need to be considered.
-Photo Credit: d'n'c
-By: Anna Newell Jones