How to Start a Month Ahead Binder and Savings Challenge Binder | What are Sinking Funds?, by Stuff And Budget on YouTube. 27 min 18 s.
- Video length
- 27 min 18 s
- Time to do it
- 1 hour
- Difficulty
- Easy
- Steps
- 8
What you need
Steps
Get a ring binder and add dividers. Label one section Month Ahead, one section Savings Challenges and one section for each sinking fund you need.
List every monthly bill with its due date and amount. Add up the total so you know the exact figure one month of expenses costs you.
Divide each bill by the number of paychecks you get in a month. Put that amount aside from every paycheck so the bill is covered before it arrives.
Build the month ahead buffer. Save one full month of income first, then use last month's money to pay this month's bills.
Write a sinking fund page for each irregular cost, such as car repairs, holidays, insurance or birthdays. Note the target amount and the date you need it.
Divide each sinking fund target by the months left. That is your monthly amount, and it goes into the binder as a fixed line in your budget.
Choose a savings challenge, like a 52 week plan or a 100 envelope tracker. Colour in one box or envelope each time you add money.
Update the binder once a week. Count the cash, write down what went in and what came out, and check each fund against its target.
Tips and common mistakes
Start the savings challenge with small amounts so you do not quit in the first month.
Keep only a small amount of cash in the binder and store it somewhere secure.
Review your sinking fund amounts every month, since car and holiday costs change.
Pay the month ahead buffer back first if you ever have to borrow from it.
Questions
What is a sinking fund?
It is money you set aside a little at a time for a known future cost, like new tyres or Christmas. You save monthly so the bill does not hit one paycheck.
How is a month ahead binder different from a savings challenge binder?
The month ahead section holds one month of living costs so you pay bills with last month's income. The challenge section is a fun tracker for building extra savings on top.
How much should I put in each sinking fund?
Take the total cost, divide it by the months until you need the money, and save that figure each month. Adjust the date or the amount if it does not fit your budget.
This guide was drafted from the video's details and general task knowledge. It has not been checked against the full video. Check the video and relevant product instructions before following a procedure. Report a correction.
