Author Topic: Unplanned spending is killing me  (Read 1632 times)

Roadrunner53

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Unplanned spending is killing me
« on: October 04, 2018, 04:51:47 AM »
Had a rough year in the spending department. Freezer broke last week full of food. It is an upright model. Had to get one quick and got lucky ordering it from Sears. They delivered in just a little over 24 hours. We didn't lose any food. A month before that the dishwasher broke. I know it isn't a necessity but it is my one luxury I appreciate. So we bought a new one. One of my dogs has been undergoing treatment since May. Has had several operations and chemo. He is doing well and finished his last treatment on Tuesday.

Our brick sidewalk caved in on one spot and needs fixing by a mason. We also need to put in a little retaining wall due to the mud/dirt flowing into the driveway. The sidewalk caved in due to critters burrowing under it.

So much outgoing money we never expected to spend this year! My other appliances are ticking time bombs and are ready to self destruct any time too!

Anyone else having an expensive year?

Alf91

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Re: Unplanned spending is killing me
« Reply #1 on: October 04, 2018, 05:05:56 AM »
That's unfortunate! I had about $1100 worth of unplanned spending this year (dental work - ugh!). So thankful I have savings for situations like this.

Cubert

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Re: Unplanned spending is killing me
« Reply #2 on: October 04, 2018, 05:09:26 AM »
All that stuff pales in comparison to the new roof my insurance company forced us to install. Almost 6 grand right there. Home ownership is full of unexpected surprises.

One way to mitigate is to attempt DIY repairs but do your homework first! I am a fan of YouTube videos sponsored by appliance service parts companies. You can generally find a video for the specific model of washer, dryer, dishwasher, you name it. I've saved thousands by making simple part swaps, vs. buying an entirely new appliance.

Sorry about your dog - I hope things resolve there soon.

Roadrunner53

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Re: Unplanned spending is killing me
« Reply #3 on: October 04, 2018, 05:16:57 AM »
All that stuff pales in comparison to the new roof my insurance company forced us to install. Almost 6 grand right there. Home ownership is full of unexpected surprises.

One way to mitigate is to attempt DIY repairs but do your homework first! I am a fan of YouTube videos sponsored by appliance service parts companies. You can generally find a video for the specific model of washer, dryer, dishwasher, you name it. I've saved thousands by making simple part swaps, vs. buying an entirely new appliance.

Sorry about your dog - I hope things resolve there soon.


Yes, appliances can be fixed but with the freezer it was full of food and we would have lost about $800 had we not purchased a new one quickly. The old one was probably 25 years old. Was very stressful trying to find a freezer so quickly. We were quoted 3 days delivery by 4 different local places. Couldn't believe I bought an upright giant freezer, sight unseen to be delivered! Worked out fantastic!

Thanks about our dog! He is a sweetheart and money well spent!

singpolyma

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Re: Unplanned spending is killing me
« Reply #4 on: October 04, 2018, 06:11:00 AM »
The key to unplanned spending is to plan for it. How much do you budget for appliance repair/replace or home maintenance?

Linda_Norway

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Re: Unplanned spending is killing me
« Reply #5 on: October 04, 2018, 06:12:31 AM »
Not so many this year, although we had to buy a new wheel bearing for an old car and had it installed by professionals, as the internet warned DH it was difficult to do it himself in our car.
Some years ago, we have had 3 freezers of combi-fridges break down. Also, our main car has had a year with many repairs. Once I managed to have a flat tire, which became too flat. We had to replace all 4! tires because of 4 wheel drive. That really sucked. Some years just suck big time. But the next year will probably be low expense.
If your appliances are 20 years old, you should count on more of them breaking down. You should also consider buying second hand whenever that could be applicable.
« Last Edit: October 05, 2018, 01:34:31 PM by Linda_Norway »

Just Joe

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Re: Unplanned spending is killing me
« Reply #6 on: October 04, 2018, 07:49:46 AM »
Yep. $10K in home repairs recently.  We had the cash saved up. Things wear out. Still its a hassle.

Will be repairing the vacuum cleaner tonight. Its ancient but still works well enough. Delaying another purchase.

Also tonight will be bicycle maintenance with our younger child. That's more fun than the vacuum.

I get tired of repairing things if it happens too often b/c that's what I do at work too.

Roadrunner53

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Re: Unplanned spending is killing me
« Reply #7 on: October 04, 2018, 08:06:12 AM »
Yep. $10K in home repairs recently.  We had the cash saved up. Things wear out. Still its a hassle.

Will be repairing the vacuum cleaner tonight. Its ancient but still works well enough. Delaying another purchase.

Also tonight will be bicycle maintenance with our younger child. That's more fun than the vacuum.

I get tired of repairing things if it happens too often b/c that's what I do at work too.

Yeah, between the dogs medical care, dishwasher, freezer and mason work, it is over $10,000. The mason is doing a few other odds and ends like replacing a broken piece of flagstone in our front step which is a tripping hazard and another sidewalk that has dipped on one side. We also need the driveway sealed and that isn't happening unfortunately because it is getting too late in the season. Getting too cold to put the stuff down. Also need a new kitchen floor. The one I have is vinyl and was put down in 1987! It has started to crack. OMG, it never ends! We have savings to cover this stuff but it seems the money goes faster than it comes in! Nothing lasts forever! It is easier to plan to do one or two big projects a year but emergencies do mess up the schedule!

Bicycle maintenance with your kid should be fun!

wenchsenior

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Re: Unplanned spending is killing me
« Reply #8 on: October 04, 2018, 08:16:30 AM »
Even up to ~5 years ago I was still calling these kinds of things 'unplanned expenses' and then wondering why our annual spend was always 5-10K over what I expected. 

But eventually I decided that we are almost always going to spend 5-10K/year more than I expect, which means that our actual annual budget will be 5-10K more than I want or believe it 'should be'.  And I plan accordingly.

Now what persists in annoying me is that even when I plan, and can manage these things in terms of cash flow, the universe persistently scoffs at my plans.

E.g., after 3 straight years of out of pocket medical costs (not including premiums) >5K, I decided to use a Flex Spending Account to at least save on taxes!  I dutifully set it up last winter to max out (2650$/year) figuring even if we had a more 'normal' spending year,  we can carry up to 500$ over to 2019. Well, as of today, we've spent <1,000$ on medical stuff, and I am scrambling to figure out how to burn off 1200$ worth of care in 3 months!  I'm actually thinking of scheduling a brain MRI (I get one every few years)  an entire year early! Ugh.  Good problem to have, I know, but it's so annoying to try to be a smart planner and then have it not work out.

Or, another example:  Cars.  Our plan has always been to buy one new or near-new car every 10 years, and drive each car for 20 years.  That gives us plenty of time to get value out of each car; and it means that we have one car per household (newer car at our house, older car for my mother, who we partially support).

We were on track to ditch our old car (mom's ride, 20 yr old Saturn), give her our 10 yr old Suburu, and buy ourselves a new-ish car sometime in 2019. 

But I got t-boned by a college student 3 weeks ago (his fault).  His car was destroyed, and our damaged Suburu (back door drivers side crushed) has been at the wrecking yard racking up storage bills while waiting for the insurance claim to go through.   After 10 days of renting a car, DH and I figured, 'fuck it' and went down and bought a new-ish car.  Which is fine, but a good year sooner than we planned to do it. 

Plus, if the insurance company doesn't want to repair our old car, we will now be faced with what to do with the much older car my mother is driving, which we formerly planned to replace with the older Suburu.

It's annoying.  On the other hand, everyone involved in the car accident walked away with whiplash.  A few seconds difference in timing, and that kid would have t-boned MY seat, rather than the back seat.  I was really lucky.  So these are first world problems, for sure. 

Still annoying, though!

tooqk4u22

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Re: Unplanned spending is killing me
« Reply #9 on: October 04, 2018, 08:32:04 AM »
All this stuff may be unplanned but its not unexpected.  If you are a homeowner/car owner you need to plan for it.  Every time I have bought a house I figure the age and estimate the remaining life of the big items and appliances and cost to replace.  If something has only 40% of its life remaining then I put 60% of the cost to replace in an account.  If its past its life then I put 100% of the cost.  I treat these initial amounts as part of the cost of buying the house - usually stuff lasts longer than expected but sometimes it doesn't (like my HVAC - expected 5 more years, but only got two - heater was fine but the AC wasn't but was better just to replace whole system given the age).  After that I put $400 per month into the same account to cover the balance over time and other items that come up. 

So yes my budget and FIRE numbers include $4800/year just for paying to fix or replace shit....so much more fun than a Hawaii trip ;)

Really this should be a disclosure for first time home buyers. 

Roadrunner53

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Re: Unplanned spending is killing me
« Reply #10 on: October 04, 2018, 10:19:03 AM »
All this stuff may be unplanned but its not unexpected.  If you are a homeowner/car owner you need to plan for it.  Every time I have bought a house I figure the age and estimate the remaining life of the big items and appliances and cost to replace.  If something has only 40% of its life remaining then I put 60% of the cost to replace in an account.  If its past its life then I put 100% of the cost.  I treat these initial amounts as part of the cost of buying the house - usually stuff lasts longer than expected but sometimes it doesn't (like my HVAC - expected 5 more years, but only got two - heater was fine but the AC wasn't but was better just to replace whole system given the age).  After that I put $400 per month into the same account to cover the balance over time and other items that come up. 

So yes my budget and FIRE numbers include $4800/year just for paying to fix or replace shit....so much more fun than a Hawaii trip ;)

Really this should be a disclosure for first time home buyers.

Yes, this is true. I have always said it is easy to pay a mortgage but all the other stuff will kill you that you don't plan for. There are so many unknowns. Pumps in wells, septic systems, driveways, trees blowing down and having a company come and cut them down. Insurance doesn't pay for that unless the tree damages a car or property. No tree removal included unless you have a rider. Lawn mowers breaking down in summer, ac units breaking down in summer, heating units breaking in winter, frozen pipes. They joy of home ownership! A few years back had our house vinyl sided, new roof, new gutters, new deck...that was fun! NOT!

Dyskolos

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Re: Unplanned spending is killing me
« Reply #11 on: October 04, 2018, 10:24:52 AM »
I call this SOAK (Spending Of Atypical Kind). It gets its own category in my financial spreadsheet.
Put simply, it is "lumpy" spending; I basically include anything that can't be easily broken into a monthly cost, meaning that there is uncertainty somewhere either in the amount or the timing, or both. It can be either need-based (new roof) or want-based (hobby equipment); the defining factor is the uncertainty. I don't think it is possible (or even necessarily beneficial) to eliminate SOAK entirely, but it can certainly be planned for. High levels of SOAK complicate my financial planning, so I mostly view it as beneficial to minimize my exposure to it, modulated to the extent that it fits with my goals and values. For example, I tolerate the SOAK attendant with home ownership for various other reasons, but I recognize that I could eliminate a large chunk of my SOAK just by renting, and letting the landlord take the SOAK (Though I would be paying for the privilege of having smoothed-out spending in the rent).

I too got SOAKed pretty hard this year, . New roof (thankfully largely paid for by insurance, OOP $1600), replacement car (used, $2500 plus $400 for tires), auto repairs ($450, plus significant time expenditure to do my own work), house A/C condenser coil ($2000), and I bought a milling machine ($2500). None of this was planned for specific amount and time, but it was not unexpected, and we were well able to cover it.

« Last Edit: October 04, 2018, 10:26:44 AM by Dyskolos »

Bateaux

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Re: Unplanned spending is killing me
« Reply #12 on: October 04, 2018, 01:41:33 PM »
Budget expenses are the easy ones.  Anyone with a slather of discipline can handle day to day stuff.   It takes a Mustacian attitude and big oh shit fund to tackle the random stuff.

ixtap

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Re: Unplanned spending is killing me
« Reply #13 on: October 04, 2018, 01:55:05 PM »
A few months like that sucks for anyone. Even if you have the cash to splash with an oversized emergency fund, it is stressful.

However, if you are living on a budget, this should not be unplanned spending. Your budget should take into account the fact that appliances and roofs and cars and sidewalks need fixing and replacing. It is a matter of when, not if. Then you can say something like "I just blew through two years' worth of maintenance in a month because life sucks. And I had to take it out of my emergency fund so now I have to decide whether to build that back up steadily or cut back somewhere else to rebuild the EF."

Noodle

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Re: Unplanned spending is killing me
« Reply #14 on: October 05, 2018, 09:13:04 AM »
I love the SOAK terminology. I have read that some people have two savings funds--one for the expenses that you know will be incurred, you don't know when (car repairs, house repairs, vet bills...if you have a car, house or pet, it's going to come up sometime) and a second "true emergency fund" (someone got laid off, a freak storm flooded the house, etc). The SOAK fund is expected to ebb and flow, the true emergency fund should go untouched for the most part. If the unpredictable expenses are stressing you out, maybe it would help to make them "predictable" by having a budget line for them--plan to deposit X dollars/month in if the fund is under a certain amount and don't worry about what's coming out because it's already "spent"...you just don't know exactly on what.

I do think a lot of budgeting advice focuses so heavily on monthly spending and long-term planning that the occasional but required expenses sometimes get forgotten.

Linda_Norway

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Re: Unplanned spending is killing me
« Reply #15 on: October 05, 2018, 01:40:29 PM »
It really helps the more you can fix yourself. House repairs, appliances repair, driveway repair should preferably be things you should fix at least 50% yourself. As soon as you need to pay someone to do it for you, it starts becoming expensive.
« Last Edit: October 08, 2018, 03:41:14 AM by Linda_Norway »

Dicey

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Re: Unplanned spending is killing me
« Reply #16 on: October 07, 2018, 12:21:00 PM »
Having a generous Emergency Fund is not supported in some quarters here. I don't agree and never will, yet I somehow managed to reach FIRE, so I know it can be done. All of the expenses you list could have been abated with a generous EF, and dare I say, a bit more of a can-do, DIY attitude. Even if you know you're not going to do the work yourself, spend some time on YouTube learning about the repair. This will help you chose the best provider and not overpay.

Linda_Norway

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Re: Unplanned spending is killing me
« Reply #17 on: October 08, 2018, 03:43:36 AM »
Having a generous Emergency Fund is not supported in some quarters here. I don't agree and never will, yet I somehow managed to reach FIRE, so I know it can be done. All of the expenses you list could have been abated with a generous EF, and dare I say, a bit more of a can-do, DIY attitude. Even if you know you're not going to do the work yourself, spend some time on YouTube learning about the repair. This will help you chose the best provider and not overpay.

MMM has written somewhere that your stash of stock is your emergency fund that can be made available in just a few days. Most emergencies don't need to be paid the same day, but could be paid by e.g. a credit card that needs to be paid off some weeks later. In that time you can sell enough stock to cover for it.

Mississippi Mudstache

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Re: Unplanned spending is killing me
« Reply #18 on: October 08, 2018, 06:52:45 AM »
My phone and my car are both on their last legs. Seems like a bad combination to have unreliable transportation and communication, so I suppose I'll replace the phone this week. I'm going to try to string the car along until the end of this year, when (hopefully) my annual bonus comes in.

bacchi

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Re: Unplanned spending is killing me
« Reply #19 on: October 08, 2018, 10:10:16 AM »
Having a generous Emergency Fund is not supported in some quarters here. I don't agree and never will, yet I somehow managed to reach FIRE, so I know it can be done. All of the expenses you list could have been abated with a generous EF, and dare I say, a bit more of a can-do, DIY attitude. Even if you know you're not going to do the work yourself, spend some time on YouTube learning about the repair. This will help you chose the best provider and not overpay.

MMM has written somewhere that your stash of stock is your emergency fund that can be made available in just a few days. Most emergencies don't need to be paid the same day, but could be paid by e.g. a credit card that needs to be paid off some weeks later. In that time you can sell enough stock to cover for it.

I definitely had a cash E-fund in the early days of my FIRE journey. In the later years, I moved it all to a brokerage account.

I still keep a large checking account for rental expenses.

Linda_Norway

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Re: Unplanned spending is killing me
« Reply #20 on: October 09, 2018, 01:33:04 AM »
My phone and my car are both on their last legs. Seems like a bad combination to have unreliable transportation and communication, so I suppose I'll replace the phone this week. I'm going to try to string the car along until the end of this year, when (hopefully) my annual bonus comes in.

And replacing a phone can be quite cheap if you buy a cheap phone, new or second hand.

Dicey

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Re: Unplanned spending is killing me
« Reply #21 on: October 09, 2018, 02:59:23 AM »
Having a generous Emergency Fund is not supported in some quarters here. I don't agree and never will, yet I somehow managed to reach FIRE, so I know it can be done. All of the expenses you list could have been abated with a generous EF, and dare I say, a bit more of a can-do, DIY attitude. Even if you know you're not going to do the work yourself, spend some time on YouTube learning about the repair. This will help you chose the best provider and not overpay.

MMM has written somewhere that your stash of stock is your emergency fund that can be made available in just a few days. Most emergencies don't need to be paid the same day, but could be paid by e.g. a credit card that needs to be paid off some weeks later. In that time you can sell enough stock to cover for it.

I definitely had a cash E-fund in the early days of my FIRE journey. In the later years, I moved it all to a brokerage account.

I still keep a large checking account for rental expenses.
@Linda_Norway, I never want to be forced to sell in a down market. In fact, I just made a contribution at a charity event this weekend. I will pull the money out of my Donor Advised Fund, which is 100% VTSAX. It pisses me off that the market has had a couple of bad days, so now I'm wondering how long I can reasonably delay pulling the funds. What if I stall and the market drops more? Ugh. BTW, I set it up this way deliberately, so I knew the risk, but the DAF holds a relatively small amount of money. In real life, I am NOT going without an EF.

My thinking is closer to @bacci's. We keep a shitload of cash earmarked for our flip projects (because they're expensive to do), and smaller, but still significant, pile for our rentals.

UPDATE: Regarding the charitable contribution, the director says there's no rush to pay the bill. She says as long as I pay it by the end of the fiscal year (June, 2019) it's fine. I intend to pull the trigger by the end of 2018, but having the breathing room is really nice. Especially as we're going to another such event tonight. This time we're wearing what's in our closet and planning on a much more modest cobtribution. It's not an endeavor we have supported before, but the evening honors a dear friend.
« Last Edit: October 27, 2018, 10:20:20 AM by Dicey »

foobaz

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Re: Unplanned spending is killing me
« Reply #22 on: October 26, 2018, 10:08:06 PM »
I've had bad months where unexpected expenses kept coming in left and right, but I feel like it balances itself overtime where you can just average the unexpected expenses over the year and budget for that. For every bad month it seems I get at least 3 or 4 uneventful months where everything goes as expected.

Roadrunner53

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Re: Unplanned spending is killing me
« Reply #23 on: October 27, 2018, 03:56:53 AM »
Just had an oil change, brake job on front of car and a slow leak fixed on one tire. All that came to just under $600. Hub has to take his vehicle in next Tuesday for oil change and the mechanics will go over it to see what else it needs. Then on Wednesday one of my dogs needs some special medical tests.