Basic Budget Question

[Joe Grebe]

This is the most basic budget question.  My wife and I use Mint.com to track our finances and we just finished sitting down and looking at our spending for the year.  This gives a really good place to start for a budget for next year.  

One thing we always struggle with the infrequent purchases such vehicle maintenance.  Mint says we spend and average of 229 a month, but I know there are plenty of months all we do is put gas into our cars.  

Can anyone let me know how they deal with this?

Thanks.

[Ben Leybovich]

This is a very good question! There has been a lot of talk about CapEx on BP, mostly thanks to this guy named Ben Leybovich writing about it on the blog all the time...

CapEx stands for capital expense, and generally this tracks the big stuff - roof, water heater, AC, etc. This stuff, once replaced, will last for a number of years. But, on the day your write that check, it hurts like hell...

Works the same way with an alternator on your car, tires, kitchen faucet, medical bills, etc. **** breaks and costs money, and while we don't know when or how much, we know it will!

So - how do you budget for that? Simple answer - look at your life and try to understand what things are liable to break, and how soon. Then accrue the costs in savings, so you are ready to write the check when need be. Easier said than done, but you have to find a way :(