Food, entertainment, phone bills, rent/mortgage – these are some of the things that we can easily plan and budget for every month, and even several months in advance. Of course, we don’t usually budget to perfection – so I always add a margin of safety to my budgeting. So assuming that I need S$80 for my phone bills every month, I will put aside S$100 – just in case I incur additional charges like I sometimes do by going over my data limit.
Then there is another “contingency” planning, or for a “rainy day” – planning for things that you kind of expect may inevitably happen one day, just not on a regular basis and you’re not quite sure exactly when it will happen. Such as a new laptop when the current one suddenly goes kaput, or emergency medical expenses. Or car repairs and fines. Or extra vacations. So I always leave a little extra amount that accumulates for these big ticket items that may someday occur.
But even with my “contingency” planning – and my fiance likes to laugh and say that “you have a contingency plan for your contingency plan” for my budgeting, the fact of life is that shit happens all the time – and suddenly, every month there seems to be some unanticipated yet unavoidable events, and all that “rainy day” savings are just not enough! Plus I have specific needs assigned to those “rainy day” savings so I don’t usually like to touch them every month.
Take for example, dental work – I once went for my regular dental checkup and came out with a S$1000 bill to repair 2 teeth that I didn’t even know had problems! It was nowhere on my “rainy day” scenario; I thought that I’ll be able to cover that up by dipping a little into my “rainy day” savings, but the following month I had an interview and needed a suit so there goes another S$300. Then the month after that I had to attend a wedding – which means another S$200 gone. And so on…
It just seems that every month, something will crop up that fits nowhere into my “regular spend” or “rainy day” scenario. I think having a “rainy day” savings is just not enough – I am adding another “shit happens” budget in my budget plan. How do you deal with such “Unexpected Expenses”?
Image Credits: frankleleon