A budget is definately a process. I look over mine every month to see if I’m going where I want to go with it and if there’s anything I want to change.

There are some things that people overlook in the budget and what everyone considers unexpected expenses; however, they do not need to be unexpected if you budget ahead of time. You cannot foresee everything, but the things like medical, maintenance, emergency travel, children can be planned ahead of time if you allocate it in your budget. you may be healthy people, but you should still have a line putting away for medical costs. If you do not need it, then that is good. Keep it in savings, because chances are you will in the future. this goes for the rest of the emergency budget lines.

your emergency fund should cover several months of expenses, but I see having specific savings funds for big ticket emergencies like medical, dental, auto maint, car maint, as necessary and seperate. After having this blog and many others, I’ve re-evaluated my budget. Now what I had budgeted as emergency savings is divided into emergency, auto, insurance, medical, emergency travel, bugout, children, and house lines. At a minimum, i want to be able to pay for copays or deductibles without having to dip into my emergency fund which should cover only living expenses in case of lost wages. Note that living expenses does not cover medical, car breaking down, etc. bugout is a special fund for my wife and i if we have to bribe people to get out of a foreign country. it stays in the account when in the states and is carried in cash if we are working abroad. we do not have children, but we are planning on it in the next two years; however, having seen my brother just have two unexpected twins, this has now become a necessity budget line. emergency travel is in case of family illness or death. My parents are getting older and it’s inevitable that i will need have this expense.

bottom line you know certain major things that could happen. budgeting for them will reduce the unexpectedness of them. If you don’t end up needing the funds, they will remain as savings. i wholeheartedly concur that you need patience in budgeting, especially when you are in debt. When i was in debt, it was tough not to pay things ahead of schedule, but it would have came at a cost to other things in the budget or could have put me in further debt if something unexpected happened. definitely keep flexibility in your budget.

I especially agree with budgeting in unexpected expenses - you don’t have to wait for something to go wrong and then tighten your budget to pay for it. Plan for those expenses all along and you’ll be much happier. Thanks for your advice in this post.