August 25, 2016, 8:11 am

Three Expenses You May Be Forgetting to Budget

by: The Financial Blogger    Category: Personal Finance
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Learning to make and stick to a budget is one of the most important duties of adulthood. A well-kept budget is the key to financial stability, but a few too many mistakes in your calculations can send you reeling. One of the most common budget mistakes is forgetting to plan for financial obligations that occur less than once a month. Just when you get excited about having a little extra money to spend, you get an unexpected bill in the mail, and there goes your extra cash.
To avoid finding yourself in this situation, sketch out a rough budget several months in advance that includes these less-than monthly expenses. You do not have to be very detailed, but it is helpful to at least have some notes in your planner or spreadsheet. Some common expenses to watch for are detailed below.

  1. Insurance Costs

If you own a home and/or a car, then you need to have them insured. Payment amounts and schedules vary wildly depending on your property, provider and plan. Be sure to go over the specifics of your policies so that you know when you are responsible for making payments and how much those payments will be.
For example, homeowner’s insurance is often, but not always, paid with the escrow portion of your monthly mortgage payments. Car insurance is sometimes billed for six months of coverage at a time, but in other situations, it is billed monthly. Failing to make your payments can result in hefty fines, so it is critical that you stay on top of them. Discussing your policy with an insurance agent can help you get the best prices for your situation.

  1. Upgrade Costs

Most cell phone service providers offer their subscribers free upgrades approximately every two years. It is always fun to pick out a pristine new phone and play around with its special features. What’s not so fun is receiving a higher-than-usual bill later that month. The fact is, even if your new phone is free in the store, there is often an associated service charge that is only mentioned in the fine print. Next time you are due for an upgrade, double-check the terms of your plan so that you are not blindsided by hidden costs.

  1. Vehicle Registration

One of the most irritating budgetary surprises is vehicle registration renewal fees. How often you must pay these fees depends on where you live. For example, Washington vehicle owners must renew their vehicle registrations once a year. You should get advance notice of the fees you owe, but they can still be shocking if you had not planned for them, especially if you have multiple vehicles. The cost of your registration fees will depend upon your vehicles’ specific characteristics. It is also worth noting that some states allow you to renew your registration several months in advance.
No Surprises, No Sweat
If you want to stick to your budget, then you must eliminate the possibility that you will have to deal with surprise expenses. Budgeting is a skill that can take years to master, and it is normal to experience a few hiccups along the way. Don’t worry, though—by planning in advance and remaining diligent, you will eventually experience the freedom that comes with financial security.

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