Skip to main content

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!

Labels:
Location: Houston, TX, USA

Comments

Post a Comment

Popular posts from this blog

Starter emergency fund explained and some ideas on ways to save for it. (Baby Step 1)

Simply put, a starter emergency fund is a little buffer between you, and the curveballs life throws at us. It is a fund for unexpected emergencies that pop up at the most inconvenient time, which is the last thing you want to deal with, especially when you are trying to get out of debt. Dave Ramsey recommends saving $1,000 as your starter emergency fund. The idea behind it is not to provide a cushy cushion but rather be a safety net you can fall back on in case of an actual emergency while you are making progress knocking down debt.  This amount makes some people nervous, and there are some valid reasons, in some cases, so I will say if your job or income is precarious right now, then it may be a season of stacking up cash rather than knocking down debt, but that's a whole different topic. You have to honestly evaluate your circumstance to determine what is best for your situation. I say "honestly" because we can play games in our minds and convince ourselves that "n
Post a Comment
Read more

Tips and tricks for getting out of debt, and staying out of debt (Part 1)

Did you wake up one morning and realize that you are one emergency away from financial disaster? You may have told yourself (for months now) that you are going to get a hold of this debt, only to look up and realize that it is entirely out of control. Regardless of your story, I will give you some tips and tricks for getting out of debt and staying out. Listen, we as consumers are brainwashed to think that we need a "healthy" amount of debt, but why? Why should we live in constant bondage, is that the American dream? NO! The problem that we face as consumers is that we get approved for most debt based on our current income, but we all know that no job is guaranteed. Our financial income can all change in a heartbeat, and I think the Coronavirus Pandemic has made us realize that all too well. So why do
1 comment
Read more

What does your FICO score really reveal and do you need one?

Have Americans been fooled into believing that a three-digit number defines our real success? It is time to dig deeper into the FICO score to understand what that number really tells us. In 1956, Bill Fair, an engineer, and Earl Isaac, a mathematician, started a business called the Fair, Isaac, and Company (FICO). After only two years of starting the company, they built their first credit scoring system for American investments. In 1981, FICO introduced its first FICO credit bureau risk score, but it did not debut until 1989 and has since become the powerhouse of credit reporting. That’s right; the almighty credit score is just over 30 years old, which means it could be younger than you. Now let’s keep digging to see exactly what makes up this mighty number.   Notice anything odd about the makeup of the credit score everyone so heavily depends on to determine how likely you are to repay? The FICO score does not look at how much savings you have and the trajectory of time it took to sav
Post a Comment
Read more