Planning your financial year!

Does planning your financial year sounds crazy to you? It may be a little crazy, but I can’t tell you how much time and money this process has saved my family.  So let me tell you what I mean by planning your year.

Get a calendar, any calendar, or maybe you prefer a year-at-a-glance; it doesn’t matter, but it should be something that you and your spouse (if applicable) will refer to, especially when creating your monthly budget.  Put the kids to bed and schedule an at-home date night, or two or three.  This process can take more than one attempt, but it is worth your time and effort in the long run.  Take some time to go through the process together and mark things that may affect your budget.  Yes, even if the amount is small.

 

Here are some items to consider as you go through the process of marking them on your calendar.

• Work holidays and school calendar
• Holidays, especially ones that require advanced planning
• Special events – birthdays, anniversaries, date nights, and the like
• Family and Friend Events - Weddings, baby showers, birthdays, anniversaries, reunions, holiday gathers, etc. – again, the idea is to think of events where you might buy a gift, even a card, or maybe you need a particular outfit.
• Service projects and community events
• Dates you will take (or potentially take) Vacation or Paid Time Off.
• Annual or Semi-Annual doctor appointments
• Extracurricular fees, dues, and equipment
• School events, especially ones where you might buy or provide something. You may not know these right away but add them as soon as you can so you can include them in your budget.
• Work trips and conferences
• Periodic payments or purchases - think about things you pay for or buy quarterly, semi-annually, or annually.
• Contracts that expire - for example, maybe you get a special rate on cable/internet, and you have to call back when that rate expires or run the risk of the rate jumping up to an outrageous amount.

Don’t just schedule the date, but remember to schedule a reminder, especially if you need to start planning in a prior month(s). Doing so will help you include the expenses in the month in which you will likely need the money rather than scheduling it in the month the event might occur.

Remember to be flexible. You are estimating based on your best guess at the time. Things will come up, dates can slide, and events can change, so remember to keep up with the changes as they occur or, at the very least, make a note to make the change when it is convenient.

As you sit down each month to budget, look at this calendar to determine if a particular category needs increased funds. Or maybe you need to include a budget line item that is not typically in your budget. Trust me.  If used correctly, this calendar can preserve your budget and potentially your emergency fund.

Finally, as you go through the year, if you find that you missed something (which will likely happen), add it to your calendar, which will allow you the opportunity to include it when you sit down and go through this exercise again next year. I promise you, this process sounds like a lot of effort at first, but it has been my family's life savior.   While my family has planned like this for many years, it continues to evolve and has proven to be a great resource when creating our budget, so I hope you try it.

Happy planning!