Written by: Ava W.
We are all getting prepared to live on your own in the next year or so, and it is going to be a completely new experience for us to have to budget all of our expenses. It is crucial that we budget correctly, and don’t leave out any expenses. Otherwise, perhaps you don’t end up putting as much money aside as you want to, or you even might not end up saving at all. 32% of Americans don’t have any money in savings, as shown on the pie chart (left). This is why it is absolutely crucial that all of your annual expenses are properly budgeted for. Putting money aside to save is very important as it can help you reach financial goals, it can allow you to be more relaxed about your financial situation, and it can make you prepared to deal with any emergency situations that may arise.
Expenses that you could be forgetting to make room for in your budget:
- Household Maintenance:
- The general rule is to save 1% of your houses price every year to be prepared.
- Annual checkups, doctors visits and dentist appointments
- These costs can vary based on your health insurance coverages, but be aware that these appointments will need to be accounted for
- Gym memberships, grocery store memberships, any and all subscriptions
- These costs also vary based on which subscriptions and memberships you decide to sign up for.
- Oil changes, tires
- Tires only need to be replaced around once every ten years, but it can be costly, moderately priced tires can be up to $1,000 dollars to replace all 4. Oil changes are definitely cheaper. Make sure to budget for other car repairs that may occur throughout the year as well.
- Hair cuts
- Haircut prices for women average about $43, while a man's haircut averages $28.
- Medications/vitamins
- These are very important to budget for, as medications can be crucial to one's health, and they can become so routine that you forget they are something you need to be prepared to buy on the regular.
- Fines, speeding tickets, parking tickets, library fines
- Fines are sometimes unavoidable expenses, and they can be fairly pricey depending on what the fine is for. So it is crucial to make room in your budget for them.
It is definitely crucial to budget properly, so that you can end up financially comfortable, and responsible, and not end up being one of the Americans to the right.
Works Cited
Lam, Jackie, et al. “How to Budget for Living on Your Own for the First Time.” MintLife Blog, 23 Oct. 2019, blog.mint.com/how-to/how-make-budget-living-alone/.Michelle, et al. “Are You Forgetting to Budget for These 50 Expenses?” Less Debt, More Wine, 28 Sept. 2019, www.lessdebtmorewine.com/are-you-forgetting-to-budget-for-these-expenses/.
Ramsey Solutions. “16 Easily Forgotten Monthly Expenses.” Daveramsey.com, Dave Ramsey, 9 Jan. 2019, www.daveramsey.com/blog/easily-forgotten-monthly-expenses.
I am shocked by how high the number of people without any savings is, I truly thought this number would be lower. When taking into consideration all of the factors you listed that are potential emergency or routine expenses, it is vital to have money in your savings to account for this and make sure it can be comfortably covered. Also, I just feel that for most people it would be a comforting feeling knowing there is money in savings to be backed up on in case they need it, so I agree that having a savings account is important.
ReplyDeleteI really liked the bullet points and list of things that you need to save money for because some of them you just don't think of off the top of your mind. It also shows that there are many more factors you have to account for than you think which is a little scary because that means your money is getting spread even more thin than you originally would think. It is also really crazy that we will be living on our own in only a year and will have to make all of our own budgeting decisions. Overall I liked the article because it was a good reminder of what is coming.
ReplyDeleteThat's crazy how many people don't have that much in savings and how many people are lacking in the amount of intelligence in there savings and aren't worried about their savings. Also, these amounts of services that you could forget are really good for how we need to budget and to remember to add those expenses in.
ReplyDeleteIt's crazy how many things you have to think about while budgeting your money. I would not have considered the smaller things such as haircuts and vitamin costs, but now that you mention how many people are ill prepared regarding their savings, it is super important to start thinking about these things now. I would be interested to know how you would create a budget plan or how much it time it would take to create a productive budget plan.
ReplyDelete