I searched through the forum first but couldn’t find a similar question, though I imagine something everyone has to deal with.
Within many categories we budget let’s say £200 a month but only expect to make transactions in that category once or twice a year. E.g house renovation, new car.
How are these dealt with? In my own excel spreadsheet I would split the cost over 12 months, or have a yearly budget for some categories, or have rolling budgets (which I know are ‘coming soon’).
How are others dealing with rare but high expenses not throwing out their monthly budgets?
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I’m trying to think about what I would do in this situation… but I don’t think I account for any annual expenses in my budget at the moment?
Do you transfer 1/12 of the money needed for the yearly bill into a different account?
Do you have Emma Pro? Could you set up a custom category which was called “one-off expenses”?
@Gaoler, @Pa.ul, @jase, @o99 do you do anything like this in Emma at the moment?
Thanks for replying. You must have purchases that only need to happen a few times a year? E.g. what do you do with the Holiday category, you budget £300 a month but only spend once or twice a year. That means for that one trip you’re budget will be messed up and you’ll be under budget every other month.
Don’t know if this is any help but I set up budgets for one off payments (such as season tickets) for the full amount in the month in which the expense occurs. For the remainder of the year I reduce the budget amount to zero
Should have also mentioned that I also set up a subscription for each of these types of payments so you can see when they are coming and budget accordingly
dozens has a nice feature that lets you change a transaction from part of your daily budget to part of your monthly budget, effectively dividing it across the days in the month. Something similar for annual would be great in Emma.
My annual bills and subscriptions are budgeted for by placing 1/12 of the cost into a separate savings account.
That way, my budget remains constant throughout the year.
I actually have found a way to turn a perceived flaw in Emma, into a positive, to do this.
I simply setup a monthly payment to go to an account Emma can’t connect to, and each month 1/12th of the budget goes to that account.
If I make a payment from it but need more, I can always exclude the larger payment or return some and exclude that transaction.
I am using this now for holiday budgeting, putting a figure away each month up to my budget.
I think we budget in different ways. At the moment I don’t set a certain amount aside each month for holidays. I add as much as I can every month into savings, knowing that if I want a holiday, I can use that money? Not necessarily the best way, but works well to fit my financial goals
What’s the benefit of this? Is it so you “forget” about the account and aren’t tempted to use it?
I would use an account Emma can connect to and simply exclude the incoming transactions in the receiving account (Emma should exclude them automatically after excluding manually a few times). Then you can see your holiday budget going up.
Alternatively on Pro, I’d maybe set up a manual account with a negative balance, then set up a Smart rule to track payments out to a unconnected account in the manual account. Then, once your manual balance is zero, you know you’ve hit your target!
For recurring expenses that are charged annually instead of monthly I have a rough idea in advance what I will spend overall. I divide that by 12 and pay that amount into a savings account each month. At the moment this transfer does not have a dedicated category (I categorize as “investments” alongside my real “investments”). But I should probably change to something like “annual expenses”. When it comes time to pay the expense I release the money from the savings account (making sure transfer back to my current account is “excluded”). I also categorize the merchant transaction as excluded.
For unanticipated large expenses (e.g. replacing a broken boiler) I take the money from my emergency savings (that’s what it’s there for) and exclude the transaction.
The purpose was for the OP to do what they sort of need, as they want to budget an irregular amount over the month. Your manual account would work if they then excluded the actual payments they paid.
I paid 12 months of rent up front and I can then do something similar for paying that over the monthly period, otherwise my budget would not make sense.
Won’t rolling budgets help with this? Or maybe I’m thinking about it incorrectly because that’s what I thought I could use the rolling budgets feature for.
I would budget x every month for the holidays budget and could just better account for it. Currently I’m always either way under or way over depending if we took a holiday or not in any given month.
On this - I think would be good for items which are billed annually, e.g. insurance, or periodically (but not monthly) be able to click a button to split the payment evenly over the 12 months - any thoughts?
You could also put one-off expenses into another category, which would only show on a full year view, but would be excluded from the normal monthly views. (A bit like the “excluded” toggle, but instead an “one-off” toggle for transactions which are valid (not transfers etc) but one-off expenses - new car, new phone etc.
If you know the future date, I think it’s better to create a Savings account with a savings goal, which lets you set a target date.
This is more for things you aren’t really saving for, but just are either annual or one off (largish) expenses. Car / boiler / holiday / building work etc. and annual subscriptions (e.g. Emma!!)
Hi I was wondering if there was any update on splitting annual subscriptions into 12 monthly payments?
I’m also wondering if there’s a better way to handle this?
My use case is for expenses like:
- Annual credit card fee
- Car MOT & service
- Annual software subscription costs
While I can put aside £X/month into a different current account that it’s taken out of, when the payment comes it will exceed the monthly category budget in Emma which looks bad.