Finance Globe

U.S. financial and economic topics from several finance writers.
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Your Budgeted Expenses won’t Always Remain the Same

Your Budgeted Expenses won’t Always Remain the Same

It is easy to believe that your budgeted expenses will remain the same month after month, but this has a way of changing over time. As the cost of living increases, it is important to review your budget and make the necessary changes.

There is nothing better than finding that one or more of your budgeted expenses has decreased. Conversely, when one of these increases, it can be a disappointment. Even so, you need to adjust accordingly.

Here are some of the many expenses that can change over time:

•    Groceries.
•    Fuel for your vehicle.
•    Rent.
•    Cell phone.
•    Cable.
•    Other utilities.

Some of these changes are a result of the economy. For example, gas prices go up and down based on a variety of factors. They are down right now, but nobody knows how long this will remain the case.

There are also changes that come about as you make life changes. If you bring a child into the world, expect your grocery bill to increase. Or if you decide to move into a nicer apartment, the cost of rent will trend upwards.

If you have control over a particular expense, do your best to keep it the same month over month. If you don’t have control, be aware that it could change at some point in the future.

Your budget should be as accurate as possible at all times. If your expenses begin to change for any reason, be sure your budget reflects this.

When was the last time you reviewed your budget? Did you find that some expenses have changed since your last review?

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Comments 1

Frank on Thursday, 14 January 2016 10:40

This is an important concept here and for anyone interested in a high-level business lesson, this is called variable expenses. Businesses deal with this everyday and have to adjust/plan for expenses that change over time. Some of the change is controllable, but sometimes the increase/decrease of an expense is out of your control. To have a strong budget, it is very important to have the ability and flexibility to make your expenses variable to be able to see how you are going to make up for the variability.

This is an important concept here and for anyone interested in a high-level business lesson, this is called variable expenses. Businesses deal with this everyday and have to adjust/plan for expenses that change over time. Some of the change is controllable, but sometimes the increase/decrease of an expense is out of your control. To have a strong budget, it is very important to have the ability and flexibility to make your expenses variable to be able to see how you are going to make up for the variability.
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