It’s easy to forget about things when you’re putting a budget together. Unfortunately, unexpected costs can arise from time to time, and they can essentially ‘break your budget’ if you don’t have something to fall back on.

Although things like Mercedes Benz servicing can be expensive, unexpected breakdowns and repairs can be a lot harder to pay for. It’s therefore important to keep them in mind when you’re putting together a budget, and make sure that you include them. Put it this way: it’s a lot better to have money left over at the end of the year than to run out of money when you need it.

Consider the following things to help you budget for unexpected costs:

Use The 1% Rule:

The 1% rule is an old budgeting guideline that involves putting aside 1% of your income every week for unexpected expenses. Although it works, 1% isn’t a lot, and it may not give you enough savings to pay for large repairs.

For example, if you earn $1000 per week – a pretty average salary in Australia – you would be saving just $10 per week. By the end of the year, you would have saved about $520. If you’ve ever had a major car breakdown before, you’ll know that this won’t cover very much. With this in mind, I’d probably recommend putting aside two or three percent of your income.

Create A Separate Savings Account

It’s easy to spend money if it’s visible and easy to access, like it is when it’s in your everyday use account. One of the best ways to put aside money for future use is to create a separate savings account. Most banks allow you to do this either online or over the phone, so it’s very easy to do.

Once you’ve got a savings account set up, you need to start transferring money into it regularly. If you’re interested in following the 1% rule (or 2% or 3%), then set up a regular transfer according to that. Alternatively, you may choose to send different amounts into your savings each week, depending on how much you can spare that week.

Expect The Unexpected

Cars do break down. Although the exact timing of a breakdown can be unexpected, you can work on it happening occasionally. When your car breaks down, you will need to be able to pay to fix it. If you’re expecting a breakdown to happen from time to time, you won’t be stuck with nothing when it does finally happen.

Final Word

The unexpected is only unexpected if you don’t expect it. If you prepare for unexpected car breakdowns before they happen, you will find it a lot easier to cover their cost without putting yourself in significant financial trouble. In my opinion, the best way to do this is to put aside a portion of your income every week. Open a separate savings account and get started as soon as you can!