Jesse shares a trick for improving your Rule Two planning (Embrace Your True Expenses), and better prepare for the next unexpected expense.
Jesse suggests pulling your last six months of bank statements, and quickly scanning them for large expenditures. Look at the number of digits, and flag the transactions that have a large number of digits (to you). This should only take a few minutes. Note the payee. This exercise is the first place to look when planning for future unexpected expenses. Did you get in a fender bender and end up with a $1,000 bill from the body shop? Did you hire a plumber to fix some leaking pipes in your basement? These are possible future expenses you can use Rule Two to plan for.
Now, hopefully you won't be getting into fender benders on a regular basis! But that auto shop expense might trigger you to think about upcoming regular car maintenance that you haven't yet budgeted for. Likewise, owning a house means regular maintenance, so at some point you're probably going to call a plumber out again. Time to assign money in your budget and plan for that!
This is a good, easy strategy for improving your Rule Two thinking, and put future you in a better financial position.
Got a question for Jesse? Send him an email:
askjesse@ynab.com
Sign up for a free 34-day trial of YNAB at www.youneedabudget.com
Meet the Man with All the Hacks! Chris Hutchins
Behind the Scenes: Working at YNAB
EP10 Money Stories: How Tristan Pursued His Art Dreams and Paid off $80k of Student Debt
Behind the Scenes: Budgeting with a Partner
Mom and Dad, We Need to Talk: Money and End-of-Life Care with Cameron Huddleston
Behind the Scenes: What's The Budget Done for You Lately?
Meet Your Guide to the Student Loan Jungle: Travis Hornsby (Student Loan Planner)
Behind the Scenes: YNAB Employees Tell Their Debt Stories
James Clear: Building Good Habits and Breaking Bad Ones
Dear College Student
Hannah Cole: Simplifying Taxes for Artists and Creative Professionals
You're Broke and Winning
A New Way to Pay for College? David Stackpole's Unique Strategy
EP09 Money Stories: Carol Kissinger Was "Bad At Money," Until She Found YNAB
How to Be a Financial Grownup with Bobbi Rebell
Uh, Are You Still Budgeting?
EP08 Money Stories: Ivan & Daniel Budget for the High Income Earner
After Years of Experiments, Jesse Does the Unthinkable
Jean Chatzky: Helping Women Find Security in Money
6 Money Lessons for Newlyweds
Create your
podcast in
minutes
It is Free
We Study Billionaires - The Investor’s Podcast Network
Money Girl
So Money with Farnoosh Torabi
Money Tree Investing
The Disciplined Investor