Let’s Get Ready to Rumble…
May 24, 2016I may have mentioned in prior blog posts that I am a huge boxing fan. There really was no choice. From the time I could crawl, I remember sitting in my dad’s lap watching boxing with my brothers and loving every second of it. (Unfortunately, I loved it a little too much and my teacher once called my parents about a boy I practiced my left hook on – mind you, he did dare me.) My earliest memories of television are watching Michael Buffer introduce the boxers and give his famous tagline, “Let’s Get Ready to Rumble.”
When summer starts coming and the expenses start mounting, I often think of Michael Buffer’s tagline. Summer time is a rumble between my finances and ever-mounting increases in expenses. Initially, I just noticed that money was tighter in the summer time, not really being able to figure out why. After I discovered the power of creating a monthly spending plan and tracking my expenses over a number of years, I noticed a certain pattern began to emerge in my family’s spending and I was able to prepare for the increases in expenses.
Summer Camp – I live in the south so my kids are done with school and free daycare (public school) at the end of May. Even though they have after-school care and school activities, summer camp is still more expensive. If this sounds like you, consider contacting your daycare about sibling discounts, reductions based on income or early registration. Second, research the summer camps not only for the best fit for your children but for the best value. Consider using last year’s childcare expense as a starting point, divide it into 12 to get a monthly average and contribute that amount to a dependent care flexible spending account (FSA) if eligible so the funds can come out tax-free to pay for your childcare expenses.
Vacations – Make sure your summer vacation does not follow you for the next 6+ months in credit card expenses by saving for it now. Honestly assess your finances to see if you can afford to get away on a vacation or if an inexpensive staycation is a better financial fit. Consider using a travel budget calculator to estimate your travel expenses. To come up with the amount of money you may need to save for your vacation, divide the estimate by the number of pay periods you have. From there, it’s a matter of setting aside the funds until your vacation.
Utilities – Depending on your climate, you may find your utility bills creeping up. I live in Atlanta and I find my electricity skyrockets in June. If you have a pool, your expenses may go up due to water and pool maintenance. Your water bill may also increase due to lawn care. Review your statements from last summer to estimate your costs for this year and look at where in your budget you may need to cut back to make up for the additional cost.
Holidays – I find Memorial Day, the Fourth of July and Labor Day to be expensive holidays because we typically do a day trip or a lot of activities on those days. Consider thinking through what activities you want to do. Will you be flying or driving? Will you need a hotel? Will you be eating out or munching on picnic foods?
Write down what you think the expenses may be. Add 10% for extras. Then break down the amount by the number of pay periods you have until the event and start saving.
Parties – If you are like our family and love to cook and feed people then summertime gives you plenty of opportunities as well as expenses. All of a sudden, the patio furniture may need to be replaced and a new grill may be “needed.” Plan for the food and estimate the costs. Then divide the costs by the pay periods you have until the event to estimate how much you may need to save.
Gas: Typically gas prices go up in the summertime. There’s not much you can do about the increases, but you can look on apps like gas buddy to look for cheaper gas. You can also use some of the fuel economy tips from the U.S. Department of energy like driving the speed limit or removing unneeded items from your truck or using cruise control to make your car more fuel efficient.
Consider thinking about the things you want to do and start saving for them now. One great idea I heard was to create a “summer sinking fund” that you use to save throughout the year so you have a pool of money available for upcoming summer expenses. Saving now, even in small amounts, will a long way into taking out the worry of summer expenses.