While a budget can put stability to your financial life, it doesn’t mean that such a tool has to be set in stone after you create it. In fact, a budget can be a changing and ever-evolving thing not only as your life and lifestyle change, but as the year changes as well.
I’ve been budgeting for nearly two decades now, and I’ve realized that my budget changes dramatically with the seasons due to various costs that come along with certain times of year. Here is how, while keeping my budget consistent, I also compensate for changes in season.
With winter comes the holiday spending season. However, we don’t let ourselves get caught up in the buying frenzy that accompanies days like Black Friday and Cyber Monday. Instead, we set ourselves a specific amount to spend on holiday gifts and hold ourselves to that budgeted number. By creating unique and creative gifts (like treasure maps of hidden gifts for the kids), we keep costs low in this area.
But with winter comes higher utility costs as well. We handle this aspect of our budget using several techniques. First off, we plan for higher costs in this area by pulling money from our entertainment budget (since we aren’t doing much outside in the Chicago area at this time of year). Second, we set a monthly “reserve” amount of about $200 aside for unexpected or higher than expected costs. We can dip into this backup fund to cover extra heating costs if necessary.
Spring is a time for saving in our budget. It’s typically warm enough to melt the winter snow but not warm enough for many outdoor activities. This is why we continue many of our savings efforts, saving up extra reserve cash if at all possible until there are more things to do during the summer. When we owned our single-family home, it was a time for putting a little more money to lawn maintenance. But now that we live in a condo and have older children, it’s a time to budget a little extra for summer clothing and sport activities.
Come the summer budget and we have to get a little more detailed. With the warmer weather typically come more activities which means higher expenses through a spike in utilities, gas prices, and our annual vacation.
To help us with this time of year, not only do we continue our “reserve” budget line trend for additional entertainment costs and higher utilities to combat the summer heat, but we create an individual vacation budget broken down into individual lines such as transportation, food, entertainment, and miscellaneous categories.
Fall brings with it all sorts of little budgetary issues, namely school-related expenses. I base my projected budget for these items on the previous year’s costs, plus an additional reserve amount of around 10-15 percent. We get an early start on things like school supplies and especially clothing so that we can find the best deals on the items we need, making the most of our budget and avoiding last-minute “must-have” buys.
Beyond the school-related cost hikes though, fall can be a great time for us to start cutting costs in our food and entertainment budget lines since weather typically begins to get chilly and we start spending more time indoors.
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The author is not a licensed financial professional. This article is for informational purposes only and does not constitute advice of any kind. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.