It is very important to have a budget. Without one, you won’t know how much money you’re spending or if you have enough to cover your expenses. There are many things you need to consider as you make a budget, but you also need to expect the unexpected. Emergency costs can come up at any time. If you don’t have the money to cover them, you could be in trouble. Here are some common emergency costs you should leave room for in your budget.
1. Home Repairs
If you own a home, unexpected costs are going to come up all the time. There are so many interconnected systems that keep your house safe and comfortable. If something goes wrong in one of them, it can cause many things to go wrong. This is especially true if you have a private well. According to the US Geological Survey in 2009, 23% of the two million wells in the United States had enough of at least one kind of contaminant to cause public health problems. You don’t want your family to get sick in a situation like this, so you need money available to make the necessary repairs.
2. Car Repairs
Unless you live in certain areas, you likely need a car in your everyday life. Unfortunately, cars can break down. They also need regular maintenance in order to prevent bigger problems from occurring. Around one in three drivers will have their car break down each year, which leads to 69 million car breakdowns. The necessary repairs can be expensive. However, ignoring the problem can make it even worse. This could eventually lead to extremely expensive problems or the need to get a new car. If you have money put aside in your budget to cover car repairs, you’ll be able to fix these problems before they get too big for you to solve on your own.
3. Burglary and Theft
Nobody wants to be the victim of theft. However, it is common. In Tennessee, the FBI says there were 191,279 reported property crimes, of which 137,708 were larceny-theft. While authorities might be able to get some stolen goods back, this isn’t always the case. If your valuables are stolen, you may need to replace them. This is especially true for things like computers, which many people need for work. Make sure that you have some money in your budget to cover replacing these things if they’re stolen.
4. Medical Expenses
Accidents and illnesses happen, so it’s important to be prepared for these things. When you or a family member are in the hospital, the last thing you want to worry about is how you’ll pay for the treatment needed. When you have some extra money set aside in your budget to cover unexpected medical expenses, you’ll be in a much better position to focus on treatment and recovery without added stress.
5. Job Loss
Unfortunately, job loss happens. If your job is the only source of income you have, this can be an extremely stressful situation to find yourself in. While you might be able to get a new job quickly, it isn’t guaranteed. And you’ll need to be able to cover expenses while you search. In order to keep yourself secure in this situation, you should plan for it well in advance. Put any extra money you get from your current job into savings. That way, it will be there for you, even if you don’t have any money coming in. To fully cover a job loss, even for a little while, you’ll need to have a lot of extra money in your budget.
Emergencies happen, so make sure you’re as prepared as possible for them when they arrive. Keep these common emergency costs in mind and make room for them in your budget.