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This is my question…
How do you handle unexpected expenses when you are sticking to a tight budget?
It seems like something is always coming up, a wedding, birthday, license plate renewal, and of course…Christmas! How do you plan for these expenses and how to you simply decide that you cannot afford it?
For me, the answer has always been the dreaded CREDIT CARD! That was my solution. I would just put it all on the credit card and worry about it later because I never wanted to feel like I couldn’t do something for someone or take care of business when necessary.
What happened? Over $20,000 in credit card debt!!! (Ouch)
I feel bad. One of my friends is getting married Labor Day weekend and the only reason that I'm not going is because I know I can't afford to go. I would feel like I had to write out a check for $100/$150 for me and then double it if I brought a guest and I just couldn’t do it. I hope it won’t always be like this.
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4 comments:
Our budget includes some left over cash after all the bills and expenses have been accounted for. Basically we try to have a few hundred dollars extra each month (so we go without some things) in order to accomodate all those monthly "surprises"
I do escrow. Basically, list all expenses that may come up during the year, add them up and divide by amount of paychecks you get per year.
Such expenses may be: presents, postage, car isurance, car maintenance (oil change and tune up), life insurance, garbage and water bill (I pay those every three months), license plate fee, etc.
Then every paycheck that amount goes in the separate savings account - you treat it as a bill. Each expense that belongs to "escrow" category is paid out of this account.
By the end of the year you rebalance the escrow and evaluate new needs (for example, new tires). Then readjust paycheck withdrawal.
I understand your feelings, but if this friend is truly a friend, a gift is not the important thing. You being there is! Don't think $100, your friend can probably tell you don't have this kind of dough. How about $40 or $50 if you bring a guest.
If I could share one thing with you, it would be what I didn't know when I was younger. I too, believed I had to give big gifts in order to participate. Trust me you don't. Don't make yourself sacrafice a special day because of money. That doesn't mean to break the bank, do what you can honestly do. But you need to stay in the game. Live. It is only money. Friends, family and your time is everything.
I love all these suggestions. I had another unexpected expense come up today to the tune of $350.
One thing I thought of was to place my tax return and/or bonus into a seperate account each year and draw unexpected expenses from there.
BTW...D you are right on the money once again. =)
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