Little White Elephants in the Room – Inconvenient Budgets Which Lead To Financial Debt
Little White Elephants in the Room Inconvenient Budgets Which Lead To Financial Debt
See List Below: All of these "life's occurrences" listed below can potentially have a huge impact on our finances because these situations in our daily lives tend to get ignored and pushed aside. These are the little white elephants that are ignored mainly because they are uncomfortable and inconvenient conversations, that for most of us, we simply do not want to talk about these topics.
We put off these conversations and these little white elephants quietly lay in the corner of the room, waiting for their future attacks. These are the little "Financial Sleeper Agents" silently waiting for that right moment to spring their attack...waiting to grow into big elephants of financial pain...and...bam! We are suddenly surprised and cannot believe this has happened to us. And since we did not want to discuss it... we never considered to budget for it...and so we never set any money aside for this occurrence...and with that... we whip out our lovely credit cards and swipe those bad boys to cover the costs. This is "Where the Rubber Hits the Road!" This is the moment where this little white elephant can grow into huge debt. This is that defining moment where our lack of planning for everything including these uncomfortable topics, can really get us into debt and start the avalanche of our finances.
I mean...who wants to talk about buying new tires for their car? My wife certainly doesn't. Or who wants to talk about saving up some extra money for a plane ticket for when one of our relatives dies? And now we will need to fly across the country to attend the funeral, plus we need to cover hotel and food costs, etc. No one wants to discuss this! And I don't blame them. But these life occurrences will happen. There is no way getting around it. And who wants to discuss setting extra money aside for when the car needs to be replaced or it breaks down, or when you need to upgrade your cell phone, or what about when the plumbing "hits the fan?" Or when you need to replace the fridge... Oh, the fun in that conversation. And so they are usually ignored and zero money is set aside for them. Not so fun but they are important.
I strong urge all of us (including myself) to take a look at the list below and seriously think about setting money aside for these life occurrences. They will happen! Make no mistake they will happen! And if we don't set money aside, plan for it, and budget for them...then most likely we will have to use a credit card to cover the expenses. And this can be the cause for many of us, the start of our financial decline with debt. The credit card companies charge you huge interest, you pay the minimum payment because you did not plan for this to happen, and then like clockwork... another small white elephant comes tromping into the room with another "life surprise". And then the finances really start to turn south.
So just a suggestion (to myself included)... set aside an emergency debit credit card or a savings account that you automatically fund a certain small amount of money each week or month... and then start accumulating the emergency cash reserves. Start funding it on a weekly or monthly basis and then we will be ready for it! And let's say goodbye to credit card debt! Again...these things will happen in life...it is just a question of when?
Small White Elephants to Watch Out For!
Transportation ~ Auto repairs, maintenance, new tires, DMV renewals, car insurance, accidents, toll road assistance, car rentals, etc.
Holidays! If you celebrate say Christmas, Hanukkah, birthdays, weddings, anniversaries, etc.,
I would plan for setting money aside for these celebrations in life.
Family Death ~ Sadly there is nothing to stop this but we can at least make this less painful by having the finances at hand when this unfortunate event does happen. Travel expenses, hotel expenses, funeral costs, can all add up in costs.
Medical ~ Dentist, doctor visits, unplanned accidents, maybe you will need to take work off due to an injury? etc.
Cars and transportation ~ New Car or pre-owned car - your car will break down someday. Better to start making payments to yourself than to the dealership, right? And don't forget car rental for when the cars break down or other reasons.
Tech Gadgets ~ New computer - the one you have will become outdated and be useless! New Cell phone - Whatever you use...Plan for those cool items to become outdated and will need to be replaced with the latest and greatest.
Home Appliances ~ Washing Machine and Dryer, Refrigerator- the machines will break down at some point in time and need to be replaced. AC and Heater.
Plumbing ~ water pipes break, toilet busts, mold behind the wall, shower head, bath tub, etc.
Other stuff ~ Bed mattress, new TV, living room couch, kitchen accessories, etc. And let's not forget about replacing the carpet someday in the future or whatever flooring you have.
Do you have children??? New clothes, shoes, sporting equipment, team sports costs, school band, clubs, hobbies; this list can go on and on.
I am sure you can add to this list of NO FUN BUDGET ITEMS...
Please feel free to comment and add if you have some suggestions for anyone to help prepare, to plan, and fund these life's surprises.
Keep safe, Stay healthy, and Keep Moving Forward!