Bills That Keep Coming: How to Budget For Recurring Expenses

Learning how to budget for recurring expenses — Image Source: Pexels

Do you feel a lump in your throat whenever recurring bills come due? Chances are, you haven’t planned for recurring expenses each month. If this is true, you’re probably putting more pressure on yourself than you need to stay on top of your bills. With a little organization and planning, we’ll teach you how to budget for recurring expenses.

What Are Common Recurring Expenses?

According to the 50/30/20 rule, 50% of your monthly budget should be used for needs. These expenses can either be fixed or variable expenses. Some fixed monthly expenses that should be accounted for in your budget are expenses like mortgage payments, insurance premiums, medication, phone bills, rent, childcare, car payments, cable, and subscriptions.

Variable expenses may include things like utility bills, food, and entertainment. Limits and estimates for these expenses should also be planned out in your monthly budget by looking at past spending.

List Out All of Your Recurring Expenses

The first step on how to budget for recurring expenses is to list out all of your expenses. Your banking app can help you accomplish this as well as any budgeting app. Once you have a better picture of your spending, you can create a realistic plan for bills that just keep coming.

Categorize Expenses

Every expense in your budget should be categorized for better organization. Common categories include shopping, entertainment, health and wellness, restaurants and dining, groceries, home and utilities, transportation, etc. Once you have your categories set, you can adjust your spending to account for recurring expenses. By categorizing your expenses, you can track bills over time as well. You can then see fluctuations in prices by season for variable expenses like utilities.

Cut Unnecessary Subscriptions

If you’re trying to learn how to budget for recurring expenses, trimming your budget is important. Are you paying for too many streaming services or subscriptions that you don’t even use? Be realistic about what you can live without so that you aren’t overwhelmed by recurring bills.

Set a Realistic Budget

After you’ve made necessary cuts in your spending, look at your budget as a whole. Is it realistic and achievable? Try out your new budget for a few months and see where adjustments need to be made. If your budget doesn’t fit your lifestyle or is too restrictive, you probably won’t stick to it.

Automate Bills

The last step in learning how to budget for recurring expenses is to automate your bills. You won’t feel as stressed about money for bills coming out of your checking account because you’ll have done the legwork to plan for them. Plus, you won’t have to juggle managing multiple payments.

Learning How to Budget for Recurring Expenses

Now that you know how to budget for recurring expenses, you can breathe easier. Organizing your finances and coming up with a solid budget will help you to not only prepare for recurring expenses but will also improve your overall financial health. Don’t be at the mercy of never-ending bills, instead take back your power over your finances.

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Teri Monroe

Teri Monroe started her career in communications working for local government and nonprofits. Today, she is a freelance finance and lifestyle writer and small business owner. In her spare time, she loves golfing with her husband, taking her dog Milo on long walks, and playing pickleball with friends.