Saving for Expected Expenses

Expected expenses are those that you know are coming and need to be prepared to cover in the future. It could be for the holidays, back- to- school shopping, a vacation or even supporting loved ones in need. No matter what the future expenses are you need to be prepared to cover, it’s important to have a plan.  

Here are a few ways you can start saving for the things that are important to you and your future.    

Create a Spending & Savings Plan 

Often, many of us find ourselves in trouble when we haven’t planned or prepared for expenses, even though we knew they were coming. The best way to avoid a financial emergency is to include those upcoming expected expenses in your spending and savings plan (aka budget).  

Don’t have a plan? We’re here to help! Veteran Saves has put together 6 steps to establishing a spending and savings plan that can help get you started preparing and taking steps to keep you on track, so that you have the funds available when the time comes.  

Know How Much You’ll Need & When You’ll Need It  

You must know what is needed before you can work toward making it a reality. Start with a list of your known future expenses, determine how much will be needed for each, and the amount of time you have to save. Divide the amount of funds needed by the number of weeks or months you have until you will incur the expenses. This will give you the amount that you will need to work into your Spending & Savings Plan to make it happen.  

Example:   You have a goal of having $1,000 set aside for the holidays, it’s the beginning of February, and you want to start using the money in November. That gives you 10 months to save.   

$1,000 divided by 10 months = $100.00 per month.  

Sometimes, when we are just beginning to focus on our finances, we may find that there isn’t enough extra money to make this happen at the moment. Depending on the goal and how important it is, you may try to find ways to increase your income – check out our list of 10 ways military connected families can earn extra money.  

Open a Designated Savings Account  

It’s always a good idea to separate the funds you will need in the future from the money that you will use to cover your normal living expenses and any other savings. A great way to do that is by setting up a designated savings account. Doing so will limit your access to the funds and can help encourage you to stick to your plan and reduce the temptation to spend it.  

Unlike an emergency fund, this is a fund set aside for a specific reason or goal. Keeping these funds separate will help you be more deliberate as you save and keeps them from getting mixed in with money that needs to be used for other things.  

Automate Saving  

The easiest and most effective way to save is automatically. Setting up an auto transfer or deposit to your savings can make all the difference – no matter how much you have to save. You set a specific amount and the date that a deposit or transfer will be made to the designated account.  

Step-by-step directions on setting up or changing your VA direct deposit information is available on VA.Gov. You can also set up auto transfers with your employer, your bank or credit union.  

At Veteran Saves, we say Start Small but Think BIG! Start with a small amount. Over time, your deposits will add up and will help you meet your goals and be prepared to cover the things most important to you when the time comes.  

If you’re just starting your savings journey, take the Veteran Saves Pledge today! Choose Saving for the Future as your goal and we’ll send you texts and emails full of tips and resources to support and encourage you along the way!