All you do, is add up all the irregular expenses that you will have over the year, divide this sum by the number of paydays in a year, and save this amount from each pay cheque in a separate account, then just pay the bills as they come up from this account. It isn’t foolproof, there can still be cash flow issues, so it helps if, when setting this up, you can feed the irregular bills account with a bit of starter money.
I love this method because after using it for a couple of years, I know that I always have the money to pay the tv licence and the house insurance, and enough to buy Christmas presents. And its automagical.
- budgeting tip: make it automagical
- too late to have an expensive Christmas?
- planning for christmas presents