Like Donna Summer, we work hard for the money and we need to manage it. Otherwise, it will manage us. We want to get to a point in our financial lives where we can pay our credit card balances off every month, pay cash to replace a dead refrigerator, and take that spontaneous long weekend trip without feeling guilty about how much we spend on it. A budget is a useful tool for that. Here are some options. After choosing the right plan for us, we need to take into account expenses that may be hiding in plain sight.
Let’s begin by recalling the conspicuous items a budget should include (along with a few examples):
- Food, clothing, and shelter for the entire family
- Childcare
- Utilities (electricity, gas, water, sewage, trash removal, recycling removal, cell phone (including data), internet, cable tv)
- Transportation (gas, oil changes, car loan, repairs, insurance, registration, car wash, parking, tolls, roadside assistance, public transportation, ride-hailing)
- Medical Copays for the entire family (office visits, dentist visits, prescriptions, dermatologist visits, eye exams, lab work, therapists, urgent care)
- Minimum monthly debt payments (student loans, credit cards)
- Savings both short term and long term (emergency fund, vacation, children’s college, retirement)
Whew! Okay. Breathe.
Now, here are some items that may not occur to us when we are budgeting, but should (along with a few examples):
- Haircuts for the entire family
- Pets (grooming, veterinarian visits, medication, accessories (leashes, waste bags, cat litter, sweaters), food, boarding, toys)
- Subscriptions (Netflix, Box subscriptions, Spotify, Playstation Plus, Amazon Prime)
- Self-care
- Property taxes
- HOA fees
- Makeup
- School (supplies, pictures, private school uniforms, sports (including uniforms, participation fees, and equipment), band (including uniforms, participation fees, and instruments), teacher gifts, fundraisers, field trips, enrollment fees)
- Lawn care (mowing, weed killing, landscaping, pest control)
- Coffee and/or Fast Food and/or happy hour
- Out-of-town guests (if they are staying with you, you are using more water, electricity, food, transportation, entertainment)
- Physical fitness (home equipment (weights, treadmill, stationary bike) memberships to gym, yoga studio, classes)
- Bank account fees (overdrafts, transfers, low account balances) if this is a significant expense for you, you might consider taking your banking to a credit union
- Gifts (holidays, birthdays, anniversaries, graduations, Mother’s Day, Father’s Day)
- Dues (union, fraternity/sorority, professional organizations, licenses, certifications, continuing education credits)
- Charitable contributions
- Software/Apps
How much we spend on these items is very personal. We also have to take our spouse’s needs, wants, and opinions into consideration. No one wants to feel financially deprived. On the other hand, no one wants to lie awake at night worrying about how we’re going to pay the bills, either. This shutting down of the economy has gone on so long that we are now in the second wave of layoffs. Some companies who managed to avoid furloughing workers, now have to ask their employees to take pay cuts or be laid off or both. When so many have lost their jobs, and those who didn’t feel overworked from home, (or tense on the front lines) forgotten budget expenses are unpleasant surprises.
Are there items that should be on this list that I missed? Please share them in the comments section.