How To Fit Unexpected Expenses Into Your Budget

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Red car with orange traffic citation under windshield wiper.

That will ruin your day … and maybe your budget.

Question for all of my fellow Massachusetts folks: Did you know that parking in a spot with your car facing opposite the flow of street traffic is a parking offense, aptly named “wrong direction”?

I had absolutely no idea. So when I parked my car in the city a few nights ago for a couple of hours, and came back to find a fat, bright orange citation envelope on my car’s windshield, I was a little confused.

***

After severely questioning the logic of both the state of Massachusetts and the cosmos, I realized that, regardless of what I thought of the existence of said citation, I was going to have to pay it.

Only one issue: There’s no line in my budget for “parking tickets.”

You Need An Emergency Fund

As I’m sure any financial expert will tell you, it’s essential for you to have an emergency fund. Even us young’uns need one; bad things can happen to anybody regardless of age, and there things that are a whole lot worse than a parking ticket.

I have about 3 months’ worth of wages tucked away for the occasional rainy day. So, although I wasn’t happy about getting a ticket, I was able to pay it without issue. You might not need 3 months’ worth—you could have a lot less or a lot more saved. (Though enough money to cover 3 to 6 months of fixed expenses is what experts recommend.)

Regardless, the key here is to have some cash squirreled away for when the universe decides to play a nasty prank on you.

Sacrifice, Sacrifice, Sacrifice

If you haven’t got an emergency fund of any kind, things get a bit more complicated.

The fact of the matter is that the parking ticket, or whatever other emergency you’re dealing with, will likely need to be paid quickly, if not immediately. If you haven’t saved any money, you’re going to have to slash some regular monthly spending to take care of it.

You’re obligated to pay your fixed expenses for the month: rent, student loan payments, car insurance, and the like. So, as much as you may want to, you can’t pull the money from those.

Instead, you’ll have to cut your variable expenses—you know, the ones that you actually want to put your money toward. Your cash for groceries, restaurants, entertainment, etc. will, unfortunately, all be options for the chopping block.

Change A Lot Or A Little?

My advice if you find yourself in a situation like mine? See if there’s one large “luxury” category you can eliminate entirely.

For example, although I like to get my shirts dry-cleaned, it’s not a necessity—it’s a luxury. I could wash and iron them for free, if I wanted to put in the time and effort.

I’m happy I had money saved for an emergency, like this ticket. If it had reared its ugly head my way when I didn’t have those funds, I would have laid off the dry cleaning for a month to fit the extra expense into my budget.

The other way to go about this is, of course, scaling back on everything. Rather than completely eliminating a luxury, just spend a little less across every expense to accommodate for the emergency. I think this is a bit tougher to pull off, but not impossible if you’re already working with just the bare necessities.

How do you deal with emergency expenses? Share in the comments below!

(Photo: Wikimedia)

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  1. Brian May 29, 2014 / 11:16 am

    I don’t know where you are from but i have been all over most of the US and it is the same for all the states I been in. Pulling out heading into traffic is asking for trouble and dangerous.

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