I've never been a big believer in budgeting. I think it's a good yardstick but already knew that future is inherently unpredictable and how can people actually stick to a fixed budget on a monthly basis, consistently, over a long period of time?
- Does it ever happen to you during certain month where your expense just go way up and how do you generally think about managing your cash flow in this case?
- Under what circumstances do you feel it's necessary to evaluate and adjust your monthly expenses? Either up or down of course.
I target a $2500 monthly budget in the household and the actual monthly expenses over the past 6 months have averaged between $2200-$2800, which to me is good. This month however, there are some additional expenses coming up that seems like 1-time expense in nature:
August 1-time expense:
- deep cleaning: $400
- out-of-pocket ortho treatment: $3600 ($1000 down paid already and remaining will be paid out in installment)
- potentially other dental expenses: let's say $500
- vacation in hawaii: $5000-$6000 in total for 2 week 2 people
- business trip (reimbursable): $900
- oil change: $220 (damn you, jiffy lube) - i drive a Honda and only do oil change stuff probably once and twice per year
I have the surplus cash flow to take care of these, but what's sort of bothering/annoying me i guess is these on the fly expenses are throwing my monthly investment ritual off balance - e.g. i expect to invest $X amount in taxable, but now can only do $X-$3000. I suppose that's what extra savings in cash/EF you already have designated some purpose is really for - you know it's money that will get spent one way (to cover unexpected expenses) so you don't really miss it.