Monday, 10 November 2014

Saving for those Big Expenses

Though we all know we should be saving for the future - saving for retirement, saving for our kids' education, saving for emergencies and home repairs - sometimes it's hard to budget for those more immediate big expenses.

We figure out how much we can afford to put aside and set up monthly RRSP contributions and RESP payments. Because it's arranged in advance and is withdrawn automatically from our account, we consider it just another monthly expense. But many of us have a harder time saving for larger expenses that loom much closer on the horizon than a far-off university education or retirement dream - repairing a roof, replacing a dishwasher, buying Christmas gifts for a big family, paying annual memberships or sports fees.

Both of my older sons play rep soccer. The cost and time commitment is enormous, but it is their passion and they excel at it so we are committed as a family to making it work. Last week marked the start of the new season, the beginning of another year of indoor training building up to the outdoor competitive season, strength and conditioning and technical training and futsal. It also meant another year's worth of fees were due. Several thousand dollars' worth of fees.

For our part, because we live on a fairly tight budget and don't have a whole lot of money left over after our expenses each month, we save for the kids' sports fees all year round. Each month I pull cash out of my bank account and deposit it onto a prepaid Visa card that I keep in an envelope in the cupboard marked "sports." This way, because it's not in a savings account linked to my chequing account and not accessible just by pulling a debit card out of my wallet, the money won't accidentally be used for another expense during the year.

When the boys' soccer fees were due last week I had what I needed saved and paid the fees in full. No scrambling, no figuring out how to stretch this month's budget a little further to cover the extra costs, no throwing it on the credit card and dealing with it later like so many of my soccer mom friends did.
For our family, because we are on a budget without a lot of wiggle room, this is the only way we can afford bigger-ticket items - monthly savings set aside where we won't be tempted to touch them. The next saving challenge: Christmas!

Originally published as "Saving for those Big Expenses" on my weekly column at

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