Here’s a beginner’s guide to building an emergency fund. If your emergency fund is not fully funded and you want to continue building it, you can set aside money each money to put towards this account. However, if you can afford to do so, I recommend having at least 9-12 months’ worth of living expenses saved up. Most financial experts recommend having at least 3-6 months of living expenses saved up for in your emergency fund. The key difference between and emergency fund and a sinking fund is that an emergency fund is money set aside for unplanned or unknown expenses. SINKING FUND TRACKER SALE! Each printable tracker is $1.99 or you can grab our 14 essential sinking funds trackers for a discount. Here is a list of different types of sinking funds you may want to consider including in your monthly budget, depending on your lifestyle and goals. You’ve budgeted $2,000 for the trip, which means you’ll need to save around $250 per month for the next eight months. Set up automatic transfers from your checking account to your sinking fund account every month.įor example, you want to go on a trip to London in eight months. Divide the total amount needed in each category by the number of months until you need it.ĥ. How many months do you want to save over?Ĥ. Write down the deadline (or due date) to save up in each category. Determine the amount you need to save in each category.ģ. Decide which sinking fund categories you’d like to create.Ģ. Of course, you’ll want to tailor it to your own personal circumstances and goals.ġ. Here’s a simple sinking fund template to follow when setting up your sinking funds and deciding how much money you should save. Read Next: 50 creative ways to save money on a tight budget How much should I put in a sinking fund? Unexpected expenses (car repairs, home repairs, replacing a laptop, medical expenses).Annual expenses that may have been overlooked (insurance bills, taxes, school tuition).Large planned purchases (new car, new phone, family vacation).Most sinking funds fit into one of the following three categories: The sinking funds you choose to create in your budget will depend on your lifestyle and goals. Top Sinking Funds Categories You Need In Your Budget I’ve also included some of my favorite sinking funds tracker printables to help you stay organized and learn how to track your sinking funds.įeel free to use these sinking funds worksheet PDF to help you stay motivated when reaching your savings goals! Today we’re going to cover sinking fund examples and the most common sinking funds categories you might need in your budget. If you want to learn more about sinking funds, such as how to track sinking funds in your monthly budget, head over to this in-depth guide here. However, we all have expenses that occur on an annual, irregular, or sometimes unpredictable basis.Ī sinking fund can help you plan for these large expenses by setting aside a small amount each month, so you’ll have the money available to pay for these expenses, without stress or worry. The typical budget is designed to cover expenses on a monthly basis or by paycheck (if you budget by paycheck). Having a sinking fund can help you save money, so you’ll be prepared to cover expected expenses without having to dip into your emergency fund or go into debt. Think of sinking funds as mini-savings accounts for expenses that you know are coming up, such as car insurance or a wedding in one year.
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