It’s easy to cash your paycheck and spend it all within 72 hours of each other, what isn’t easy is working with a budget and saving part of your paycheck for future expenses. Talking about money just days after Christmas is a buzzkill, but if not now, then when? Whether you need to cough up some cash for taxes, weddings, or a surprise vacation, planning now for major expenses in 2020 is a great way to keep your bank balance happy and your debt accumulations low.
To help you get started, here are three things you need to start saving for now. After that, you get to set the budget and start setting aside money for any expenses you know are coming up this year.
If you don’t have it set up so that taxes are automatically withheld from your paycheck, and you pay all of your taxes in April- get ready! April 15 is coming fast, and you should be taking time, starting now, to set aside some money for your tax bill so that when April comes, you’ll be ready for it.
Watch out for Emergencies
Unexpected moments happen, medical bills, a change in your job, and family emergencies all happen when we least expect them to.
This is where a savings account solely for “emergencies” comes in handy. Outline an amount of money to place in your emergency fund monthly and stick to it. When emergencies happen, you’ll be grateful you have the extra money. Although the size of emergency funds vary according to your lifestyle, a general rule is to put up at least 3 to 6 months’ worth of expenses.
Your calendar might look empty now, but give it a couple of months, and soon you’ll be planning for babies, vacations, or weddings, saving now will take a lot of stress off of these events.
One of the quickest ways to accumulate credit card debt is failing to plan for (major) expenses well in advance. Start saving for holiday gifts now, if you know about your niece’s wedding that you plan on attending, save for that too. You can never save too much money or start saving too early.