How to Budget for Things That Don’t Happen Every Month (Unexpected / Surprise Expenses) | 472

0:00Most people say their budgets get blown up by surprise expenses. But let's be real, Christmas is not a surprise. New tires are not surprises either. The dog's yearly bet visit, nope, not a surprise. They are 100 % expected, but because that won't happen every month, you feel like they sneak up on you. And that's when the roller coaster ride starts. One month you're fine, the next month you're borrowing from savings, or you're swiping on the credit card, or stressing where the money's going to come from for this quote-unquote surprise expense. Yeah, so here's the fix. Savings buckets. It's when you separate your savings into clear buckets like travel, pets, Christmas, annual bills, and you turn these surprises into a plan.

0:39You save today to avoid borrowing tomorrow. That's what we're diving into today. Do you make good money but have nothing to show for it? Are you tired of living paycheck to paycheck? Do you have big dreams for your financial future? Do you want to get debt-free but you don't want to live on beans and rice? Or you don't want to give up those pumpkin spice lattes? Hey, it's okay if you don't already know how to budget or if you're using credit cards to get through the month. Hey, it's okay if you want to seem like you have your finances all together or you're not on the same page with your spouse when it comes to finances.

1:10We know what you're doing probably isn't working, but guess what? You're in the right place. We're Shana and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey. We've been in business since 2019, helping hundreds of amazing people like you create budgets, get out of debt, stop living paycheck to paycheck, and know exactly what to do with their money. In this podcast, we'll share with you everything we know, plus everything we're working on with our clients so that you have the best chance at reaching your financial goals. We want to help you take the guesswork out of your budget, improve your marriages, and even bring your kids in on the conversation.

1:45We can help you no matter where you're at, whether you're the single mom who's never had$500 in her savings account, or the millionaire who's paid off four real estate mortgages. And we're not going to shy away from the tough love. We'll tell you what you need to hear and encourage you at the same time. This is the Financial Coaching for Women podcast. All right. Welcome back for the sixth episode and step five of the Budget Besties Method. Today, we're talking about starting your savings buckets. And we have a fun story. This is from way back, like some of these stories she's like an og client yeah og like literally og from all the things and she's doing so well now so it's like really cool to know that we were able to help her a little bit in the beginning and i want to give a little bit of context if you don't mind really quick she's actually a very successful financial advisor and she came to us kind of shame like shamed herself on oh my gosh i should know how to do this i teach people how to manage and wealth yeah manage their wealth and invest.

2:43And I'm like, no, those are two completely different things. She is very good at what she does and we are very good at what we do. And it just really bridged the gap for her. Anyways, it just catapulted her in an amazing just direction for her and her family. So I just wanted to say that about it. Yeah. So she was, it's just a really fun, simple story, but she went in to get a repair. You know how like you do fix a flat or whatever on your tire. And she thought that isn't this how it is. You go in and you're like, I'm just going to get a little oil change. I'm like, you need a new car basically.

3:11And you're I can't afford that. Thank you so much. But what they did, of course, here is say, you actually need four new tires. And she's, okay, how much? And they were like, what? Wait, what? What do you mean? First of all, where's the pushback? Second of all, people are not usually ready to pay for it. But she had a savings bucket called vehicle maintenance where she was already saving for things like that. Oil changes, tires, the brakes. There's maintenance that you know is coming for your car. So if you can just set aside the money, particularly if you have like ball tires, like you need to start.

3:42Oh, yeah. You need to be paying. And you need tires every however many miles. People who are smart know that. So it's something that you can, she could expect. And she did save for it. And the technician guy was shocked when she was not alarmed. She just pulled out her debit card. She transferred the money from her vehicle maintenance to her spending and said, thank you. I'm going to drive away my brand new tires. I'm going to be really happy. And there's no stress. Yeah, and he was probably really surprised that she didn't apply in the moment for their 0 % interest card that they offer you every time that you need new things at the tire repair shop.

4:12It was really beneficial for her. She had been working with us for a little bit at this time. Like Shana said, she had the money available. And imagine that being you. Imagine you going somewhere needing a small repair or needing something small. And they were like, oh, by the way, you need this. And I was like, oh, that's okay because I have the money. I've been preparing for this moment my whole life. No, I'm just kidding. you, it's probably the, maybe it's going to be the first time that's going to happen to you. And it's going to feel really good. Instead of the sinking feeling that probably would come up otherwise, for sure.

4:41But, and so the whole lesson here, the point is if you separate your savings, no surprises, you're going to, you're going to end up with no surprises. Yeah. And listen, if you don't save for it now, you're going to end up, or you could end up borrowing for it later. And another analogy of that is okay. So maybe later you're like, Oh no, I'll just figure it out. Okay. That's fine. You figured it out. Maybe you paid cash for the one thing, but did you have to put your gas and groceries on credit that month because you couldn't afford that because you made the other bill work. It's just like this domino effect.

5:08Right, exactly. Yeah, and that's what we want this whole thing to take away from. We want you to be able to be your own bank. Like Vanessa said, you don't have to borrow. You have money set aside for all of these things that are, as we've said before, they're not monthly, but they're still expected expenses. And being able to save for them for each thing is really going to be a game changer for you. Yeah, these buckets turn surprise expenses into very planned expenses. Like you are ready for them. It doesn't matter when the annual bill comes up. It doesn't matter when the vet visit comes up. Excuse me.

5:39You have the money. And again, like Shana alluded to, you have become your own bank at that point. Yeah. And so we do these buckets for everybody. Every family is going to have their own different ones, but there are very basic normal ones that which are you have travel, you have medical, you have kids, you have Christmas, you have your household, you have your vehicle, You have annual bills. We have initiated the glam up. I was going to say, girl, don't forget it. The glam up one. Some people have clothing if they, depending on their lifestyle. And then also they might, you have a kids one if you have kids, because let me tell you, you might as well just start saving money because they're always going to find a way to spend it.

6:14Sports, school, field trips, events, like all the things that they have going on. So all of those categories have their own account. That's how this works out. And if we're really doing a good job, there are high yield savings accounts too. Yeah. So again, hear us on this. There are a lot of banks out there that have buckets. They have a bucket system. Love that for them. Or vaults or whatever, just different, where they're inside of one account. Right. That is not what we're talking about. We want you to open up a separate savings account or a separate high yield savings or a separate money market.

6:45Okay. I said all the words. Yep. We want you to open up a separate one and then you get to rename it, whatever the category that it is. And so when you immediately pull up your bank app on your phone, you can see all your accounts listed there individually, what amounts you have for each of them. And you're not having to log into one account and then see it all separate. That is like Excel spreadsheets, the bank version. We're not doing that. We're doing separate accounts. Yeah, for sure. And yeah. And so the way that you do this in order to save today and avoid borrowing, like Vanessa said tomorrow, is you're going to list out, like we said, those categories.

7:18Maybe there's some special to you. Maybe you have hunting or, I don't know, different things that people do. Yeah, we have some people that actually like to do a season-specific one. So if they're going to Disney, they want one account that specifically says Disney or something. We have homeschool. That's another one that people do often. And health and supplements. Sometimes people do that because they'll do bulk purchases of whatever they take. So they want to have that money set aside. That's finished on Black Friday. Yeah. So those are all ones. So what you want to do is like any of those particular expenses, homeschool, health, Christmas.

7:47How much do I spend on all of this in a year? I'm going to take that number. And generally, this is a general part. I'm going to divide it by 12. And that amount that I come up with, I'm going to start setting aside monthly into that separate account that I opened. Yeah. So these are non-monthly expenses. So I want to be really clear on that. These are things that don't go in the monthly budget. These are all the one-off expenses that happen randomly throughout the year. You're going to add up how much you cost in a year in these specific categories, not in your regular budget for gas and groceries and things like that, restaurants.

8:18We're not doing that. These are all the categories that we explained earlier. And you're going to add them up, divide it by 12. And in each category, you're going to put that amount of money in that account every single month. And then you are set. You know that you don't have to worry about things coming up in those categories because you have them. Oh, one we missed, very important, is gifts for birthdays and stuff. All right, Budget Besties, it's time for some Real Talk. You don't need another budget. You need a budget system. Our simplified budget system is what you've been looking for. It's going to allow you to be bougie on a budget.

8:51You'll be able to easily set up a system that runs automatically and shows you exactly where your money is going. And it's going to give you permission to spend. Everybody loves that. Yeah. It's straightforward, pretty, and packed with walkthrough videos that break down the exact methods we use with our clients to get out of debt, set up a bills account, separate spending, build savings buckets, and end the paycheck-to-paycheck feel. If you're new to budgeting, this is the perfect way to jump in. And if you're already a budget nerd like us, you're about to meet your new obsession. This is the upgrade to your finances that you need right now.

9:25Yeah. So head on over to budgetbestdista.com forward slash budget and grab yours. Now back to today's show. So what you want to do or what this is going to do is allow you, for example, for Christmas coming up, imagine you have an account and money is just set aside there. So when you see the deal, when you see the gift that's the perfect gift, you're not trying to figure out where the money's coming from. You know where it's coming from. And you're not having to put Christmas, which is very expensive time of year, right, on debt because it's all set aside there. The same like we talked about with our client earlier.

9:54When you go to the vehicle, the tire shop, you can actually just pay for it because you've been setting aside. That's the whole point here. That's why we say we want you to be your own bank. Imagine Christmas not being stressful this year for you. It could be you. Imagine it being this wonderful time of giving because you have the cash available. You're not stressed about it. You're not going to have to put it on a credit card and then think about, what did I just do in January? We're not going to start the new year like that. You still have time to set money aside right now. See if this can be the first time for you.

10:24Yeah. And really what this says is just take the roller coaster out that we talked about in the intro. It's instead of every month, the property taxes are due or this is the car insurance or whatever annual bill, or, oh, I forgot it was my mom's birthday or whatever. I have been setting aside money for all of those surprises that come up. And now, like we've said before, now my monthly budget is steady. It's the same every month because I'm setting aside for these big, separate, random expenses. And that really does take the rollercoaster feeling out of your budget. I think that's a good point.

10:56And I want to hit on that really quick. One of the things that we pride ourselves on with our clients when we make their budgets is we want everything to be as consistent as possible. And in order to do that, you need to have these things planned out. Now, when clients come on, it's probably month four, five, and six when they're actually adding their savings buckets or we start having them look at it and add it up. Because sometimes they can't. Sometimes I come in and they say, hey, I want to do the savings bucket thing that you talk about. We're like, but you can't. You have no wiggle room right now because you're paying$2 ,000 a month in debt, right?

11:27But imagine you not having that debt and then you can put all that money towards savings buckets. That's going to be them in the future. But at the beginning, it takes some time. what we want you to do is to use the savings bucket tracker, print it out. We'll talk about that in a minute, but print it out and figure out what do I cost and then do the math and then figure out what you need to put in monthly to make your budget consistent so you don't have to change it. Yeah. And you can find that at budgetbesties.com forward slash savings buckets, both words in there. And we're giving it away for free because we want you to stop stressing about money.

11:57We want you to feel that consistency that we're talking about. And just so you know, it's also available in our regular budget system, simplified budget system, the whole system. And then it does the math for you and it really makes it look pretty and it's really great. And you don't have to do it with a pen and paper or an eraser or calculator because it's going to do it yourself. Yeah, because all the formulas are in there, guys. It's really pretty. So that's something that you want to consider. And if this feels like, okay, it makes sense, but I don't know what to do with my hands. I feel like I want to do that, but I don't know how.

12:24That's where coaching comes in. If it makes sense to you, then that's something you need to take it and run with it. If you just need a little help, that's what coaching is for. That's what we're here for. We're here to help you for give or take about six months, help you get all of this set up, help you answer every single question and get rid of any scarcity, any unknowns, and like where you're going to feel really confident to do it on your own. That's what coaching is for. And that you can go to budgetbesties.com forward slash coaching to book a free financial interest or coaching call and see if that's something you'd be interested in.

12:53Yeah. And if you look at the times and you're like, nope, I don't want any of those times. I want to get started right now. Just email us at hello at budgetbesties.com and we will see if we can squeeze you in. All right. Step five was start your savings buckets. This is going to be the game changer for you to take the guesswork out of the surprises out of your budget and we hope you enjoyed it. And we'll see you next time for our next step. We got three left, guys. We're almost done. The next one is break up with debt. If you're tired of feeling like your finances are all over the place and you're ready for a simple set it and forget it way to budget, we have something special for you.

13:24Watch our Automate Your Budget Masterclass at budgetbesties.com forward slash automate. We'll show you step-by-step how to finally organize your money, how to set up your accounts, and put your budget on autopilot so your bills, savings, and spending run like clockwork. Imagine less stress, more savings, and the freedom to spend money without having to track every dollar or babysit your bank account. Go to budgetbesties.com forward slash automate to start today.