BudgetSketch is all about sound planning… all about intentional money management. We built our budgeting software around the idea that in order to use predictability to your advantage, you need to plan ahead. Now… some think planning ahead means things like retirement planning, or anything that involves long range goals. Not so! Our system requires people to look at the next month or two and decide what to do with their money.
We all know our recurring expenses, and it’s nice to see those laid out for us, but what about all the stuff each month that falls under the ambiguous miscellaneous expense column? How do we get a handle on the expenses that we forget about or catch us by surprise? How do we properly manage our cash flows each month so that we handle life’s expenses and still meet our financial goals? Intentional planning is the key!
Jennifer Derrick, author and blogger at SavingsAdvice.com is a person who gets it. She recently blogged about the principle of Use Predictability To Your Advantage: Planning Ahead Saves Money, where she expertly describes a number of ways to save money by “looking down the road”. I encourage you to read the full article, but here are a few of her ideas that can be easily applied using BudgetSketch:
- Know your bill pay dates and deadlines to make sure you get payments in on time and avoid late fees. They’re often the same month to month, so it’s easy to plan for this.
- You know Christmas is coming, so save a little each month to avoid a big money hit in December.
- Plan summer and weekend activities/entertainment for the kids so you have time to buy supplies on sale, enroll them in programs (at early registration discounts), pre-purchase tickets at a discount, and get up to speed on specials like free summer movies at the theater or kid’s days at local attractions.
- Plan back to school shopping and buy as much as you can on end of season sales the year before and on tax-free holidays if possible. Paper, pencils, crayons and glue will last into the following year.
- You have a general idea of when you need to buy things. Maybe you buy pet food once a month, laundry detergent twice a month, cleaning supplies every two months, etc. You know when it’s time to start thinking about buying more, so watch the sale flyers and plan your purchases to take advantage of sales. It beats running out to buy pet food at the highest price because you waited too long and now Fido is out of chow.
- Similarly, you know when big things start to look like they need replacing or repair. The warning signs are usually clear. You can tell the car is on it’s last legs, you know you need a new computer because yours is too slow, you know the couch is developing an uncomfortable sag, and you can tell when the oven just isn’t heating right any more. Use those early warning signals and start looking for the best deal on repair or replacement, rather than waiting until the item is totally dead and you have to buy a new one at full price immediately.
- You know that things like insurance payments, vet visits, and taxes occur at certain times of the year, so look ahead and save a little for them each month to avoid being shocked when the bill comes due.
Using good ideas with the right tools is the only effective way to manage our own micro-economies. What other ideas can you think of that fit the principle of using predictability to your advantage?
