Even the most carefully crafted budget can sometimes fail to cover those pesky unwanted and unexpected expenses. No matter what you do, life will find a way to hurl a wrench into your best-laid plans. To help you get a better perspective on what could come your way, we've created a list of some of the most likely expenses to come at you out of nowhere.
1. Home Expenses
Whether you own or rent your home, you will have to spend money every now and then to improve your spot or fix damaged aspects of the property. Those expenses could come in the form of new appliances, weather or accidental damages, home renovations, plumbing costs, HVAC costs, outdoor upkeep (mowing, general cleanup) and many more. The best way to plan for these is to keep a portion of your budget aside for an emergency fund that can get you through these tough spots.
2. Seasonal Expenses
With the changing of the seasons comes the changing of costs for a whole host of necessities. During the summer, your air conditioning and water usage can make your utility bills skyrocket, especially in the Texas heat. During the winter, your heating bills, cold-weather clothing, and weatherproofing for home and vehicle costs can increase just as much. The best way to prepare for this is to expect it every time. Even if you escape the season with lower costs than you thought, your budget should always allocate extra just in case toward this category.
3. Medical Expenses
No one can properly prepare for medical expenses. Even if you are fabulously wealthy, a visit to your doctor can totally tear the rug out of under you. For the rest of us, recognizing that you can and will get sick at some point in your future is certainly wise. Sometimes even a minor illness can take you out of work for a week and reduce the amount of money you bring in that month. Simply recognizing this as a possibility and keeping that emergency fund handy at all times can help to potentially mitigate most of the effects of medical expenses.
4. Pet Emergencies
Just as people can have medical emergencies, so can animals. Maybe your dog ate something it shouldn't have, or your cat hurt its foot. People rarely think of pet emergency care as one of their expenses to budget for, and yet it can get expensive, easily costing thousands of dollars to treat animals for such problems.
You can look into getting pet health care insurance. Or you can set aside an emergency fund dedicated solely to your pets. Either way, you will be better equipped to deal with this high expense.
5. Auto Expenses
Vehicles are often temperamental mechanical creatures that can wreak havoc on your finances at the worst times. Maybe you've spent the past year saving up for a vacation when the engine in your car literally falls out or your tires burst on the freeway. You have no choice but to spend that money ASAP. Automobiles also come with a number of smaller expenses for tune-ups, oil changes, inspections, registration, and more. As a vehicle owner, it is imperative that you always stay prepared for these expenses as they are usually right around the corner.
6. Gifts and Special Occasions
Your sister just got her degree and you need to get her something. Your parents just celebrated their 40 year anniversary. Or maybe you forgot your friend's birthday was this month. When you need to make a statement of affection or contribute to a celebration, your budget can suffer. What many people do in these situations when they are careful budgeters is to pull from what they would have otherwise spent on entertainment and any other frivolous nonessential categories of their budgets. This is a smart move, but can also be bolstered by maintaining an additional category for gifts, parties, and more.
7. Unexpected Travel Plans
People plan their vacations months in advance, which allows them to get the best prices on lodging and entertainment. But what about unexpected travel expenses, such as going to a funeral after the sudden death of a loved one? You don't have time to shop around and get the least-expensive plane ticket. You have a schedule, and you have to stick to it.
You can budget for such unexpected costs by building a cushion into your emergency fund. Unexpected travel plans likely don't happen often, so you won't need a huge fund to cover them. But it is reassuring to know that in an emergency, you can afford to get to your loved ones.
8. School Expenses
Even if your child attends public school, you will encounter lots of requests for money throughout the year. Just a few unexpected expenses that may come up include:
- Field trips
- Teacher gifts
- Sports equipment
Most of the time, you have little choice but to pay these bills. If you don't have cash on hand, that can be a problem because most schools don't accept credit card payments for such costs. When you budget for unexpected expenses in advance, you build a cushion into your monthly outputs so you can pay for these unanticipated costs.
9. Seasonal Costs
If a blizzard dumps two feet of snow on your house and you don't have time to clear the driveway yourself, you may find it's necessary to hire someone to remove your snow. Other seasonal costs may be repairing or replacing your roof, painting the exterior of your house or even hiring a landscaper to redesign your yard.
You never know what seasonal expenses you will incur. Even the most modest expenses may not fit into your budget, but setting aside some funds to cover these potential expenses can help.
10. Unanticipated Rises in Your Bills
Have you ever received a cable or cell phone bill that jumped well above the previous month's expense? Have you endured an unusually hot summer that required you to crank the air conditioner way up, raising your electric bill? Such utility increases can come without warning, and you may not have enough in your monthly budget to cover them.
In this case, a personal loan could be the best solution. You can get the exact amount you need without borrowing more.
Now You Know Common Unexpected Expenses and How to Budget for Them
Do you think you have what it takes as a financial planner to budget for the unexpected? We sure hope so! And for all those unexpected expenses you can't afford, there's always the option of a quick and easy online personal loan from Atlas Credit. We can get you situated with a personal loan of up to $1,400 to cover expenses with the worst possible timing — apply online today!