It may be a little early to talk about Christmas but this tip will show you how a sinking fund can help you pay for gifts without panicking in December and without going into debt.
Like what you heard? Go ahead and share on your social media! Visit trianglecu.org to learn more about how we can serve you and don't forget to follow us on Facebook and Twitter!
Transcript:
Welcome to Money Tip Tuesday from the Making Money Personal Podcast.
It is mid-March as I record this for you. We’ve had a couple of days of warm weather here in New Hampshire but we are all still recovering from Winter and everything that came with it. Christmas is likely the very LAST thing on our minds.. it was just about three months ago after all. If you are like many Americans, it is likely that you scrambled at the very last minute to get gifts for those special people in your lives.. The average person waits till about November to begin shopping and many of us wait until December 15th. Waiting until the last minute to shop is hard enough but it is even harder if you also didn’t have any separate funds saved to pay for it. This is where a sinking fund comes in!
A sinking fund is a separate account containing money to pay for something in the future. This fund or these funds can be used for whatever you want.
Lets say you plan to spend $500 on gifts at Christmas and you start a sinking fund in January. Simply take 500 and divide by 12 months. Just like a bill, every month you would pay (or transfer) $42 to a separate savings or checking account that is specifically for Christmas. You can even label it “Christmas Fund” so you know what you are saving for.
I love sinking funds. It is a stress free way of paying those items that don’t occur each month. I use them for insurance premiums, activities for my daughters like ballet and gymnastics, and Christmas! I know many people who also use them for other items like a new phone every couple of years, or a new car they know they will need to get in the future. You can do this for anything and it can even be for items you pay monthly. I love to do this for my rent every month! I take my rent payment and divide it by the number of times we are getting paid in the month and I transfer that to my rent savings account. On the first of the month, that money is there!
Do you have any additional tips or advice that will help our listeners with this topic or other financial matters? Send us an email! That email address again is TCUPodcast@trianglecu.org or look for our Facebook page and get connected!
Thanks for listening to today’s Money Tip Tuesday and be sure to listen to our other tips and episodes on the making money personal podcast.
How to Avoid Advance Fee Scams - Money Tip Tuesday
Top Reasons to Talk To a Financial Advisor - Money Tip Tuesday
Episode 50: Why You Should Consider Identity Theft Protection - Basil Paul from Econocheck
Quiz: How Secure is Your Online Holiday Shopping? - Money Tip Tuesday
The Pros and Cons of Purchasing a Vacation Home - Money Tip Tuesday
Five Fun Things to Do in the Fall - Money Tip Tuesday
What is Synthetic Identity Fraud? - Money Tip Tuesday
Episode 49: Marketing Best Practices for Your Small Business with Terri and Liz
The Pros and Cons of Working from Home - Money Tip Tuesday
Can You Answer These 5 Financial Questions? - Money Tip Tuesday
Fraud Prevention for Phone Scams - Money Tip Tuesday
The True Cost of Purchasing a Car - Money Tip Tuesday
Tips to Saving Money while in College - Money Tip Tuesday
Episode 48: Why You Need a Business Exit Plan with Eric Cooper
Simple Ways to Pay Down Debt Faster - Money Tip Tuesday
Cybersecurity for Small Businesses - Money Tip Tuesday
The Benefits of Banking with a Credit Union - Money Tip Tuesday
Top Items for Your College Shopping List - Money Tip Tuesday
5 Skills to Become a Successful Entrepreneur - Money Tip Tuesday
Episode 47: Steps to Starting Your Own Business with Sunil Khadka
Create your
podcast in
minutes
It is Free
Navigating Life After 40
Teaching Learning Leading K-12
Regenerative Skills
The Jordan B. Peterson Podcast
The Mel Robbins Podcast