Why Your Budget Keeps Failing—and the Simple System That Helps You Save for Auto Insurance, Property Taxes, Big Bills and Unexpected Expenses | 448
Your “unexpected” bills aren’t unexpected — you just haven’t planned for them. With one simple system, you can eliminate surprise expenses and finally get off the budgeting rollercoaster.
The Real Reason Your Budget Feels Like a Rollercoaster
You sit down at the start of the month, map out your income and expenses, and everything looks good…
Until an annual car insurance bill shows up. Or your Amazon Prime auto-renews. Or the state wants your vehicle registration fee — again.
Suddenly your plan is toast, and you’re pulling from savings (or worse, credit cards) to keep up. And just like that, you’re back to square one.
Here’s the truth:
These bills aren’t emergencies. They aren’t surprises.
They’re predictable — you just weren’t planning for them monthly.
And the solution? A simple system we teach every single client we work with:
The Annual Bills Savings Bucket.
What Is an Annual Bill, Really?
An annual bill is any expense that:
- Doesn’t happen monthly, but
- Happens predictably, at the same time every year (or quarter)
Some common examples:
- Auto insurance (if you pay it in full for a discount)
- Homeowners or renters insurance
- Property taxes (depending on where you live)
- Vehicle registration
- Memberships and subscriptions (Amazon Prime, Costco, AAA)
- Heating oil or propane (for our cold-climate friends)
- Water or trash bills paid semi-annually
- Software renewals (QuickBooks, antivirus, etc.)
These are often large-dollar items, and when they show up in an already-tight budget, they feel like a financial crisis. But they don’t have to.
How to Budget for Annual Expenses (Without Breaking a Sweat)
Let’s walk through how to create your Annual Bills Savings Bucket — a system that helps you stay ready all year round.
Step 1: Identify All Your Annual Expenses
Look back over your last 12 months of bank or credit card statements. What charges came through once or twice a year? Make a list.
Don’t worry about being perfect — start with what you know, and keep adding as more come up.
Step 2: Write Down the Amount + Due Date
For each bill, write down:
- The total amount due
- How often it comes (annually, semi-annually, quarterly)
- The month it’s due
This helps you see any seasonal patterns. (For example, many families get hit with multiple annual bills in July and December — right when vacations and holidays stretch your spending.)
Step 3: Add Up the Total & Divide by 12
Once you know your total annual expenses (say, $6,000), divide that by 12 months.
That’s your monthly savings target. In this example:
👉 $6,000 ÷ 12 = $500/month
That $500 needs to be moved into a separate savings account — not left sitting in your main bills checking account. We want this to be clean and organized so you’re not tempted to use it for everyday spending.
Step 4: Automate It
Set up an automatic monthly transfer into your Annual Bills Savings Bucket (name the account that way!).
Now, when your $1,200 insurance bill hits in October, the money’s already waiting — no scramble necessary.
But What If You Can’t Afford the Full Monthly Amount?
We get it — not everyone can suddenly start setting aside $400 or $600 a month.
Here’s what to do if you’re starting from behind:
- Prioritize by due date. Start with the bills coming up soonest and work backward.
- Use short-term math. If a $1,200 bill is due in 3 months, you’ll need to save $400/month for now.
- After it’s paid, shift back to monthly math. Once that bill is handled, you can return to saving $100/month over the next 12 months.
Even if you can’t save the full amount yet, saving something is better than nothing. Every dollar you set aside now reduces stress later.
Why This System Works (Even If You’ve Tried Budgeting Before)
Here’s what makes this method so effective:
- It removes the panic from your budgeting process.
- You can pay bills in full and take advantage of discounts.
- You won’t dip into your emergency fund for non-emergencies.
- You’ll feel in control — which is the whole point of budgeting.
This isn’t about restriction. It’s about intention.
And that’s the difference between living paycheck to paycheck… and building financial momentum.
Ready to Ditch the Budget Chaos?
We’ve helped hundreds of families implement this exact system — and they all say the same thing:
“I had no idea how much anxiety these surprise bills were causing… until they stopped being surprises.”
If you’re ready to stop letting annual expenses throw your finances off track, start with our free Annual Bills Tracker and Budget Template.
Click below and get your Savings Bucket set up in 30 minutes or less.
Your future self — the one who’s not freaking out in December — will thank you.
Book Your Free Call Now!
We are excited to create the time & space to talk to you about your current money situation. This is a free, no-obligation call where we can answer questions you may have and maybe find some quick wins for your budget.
What do you have to lose?
FULL TRANSCRIPT
Do you have unexpected big bills that pop up here and there in random, ran what feels like randomly and ruin your monthly budget.
Yes, we do have that. Yes, we do have people who come in and say, listen, I’ve totally forgot about this bill and I forgot about that bill, and I don’t know what to do now with my monthly budget. How do I fix it? Yes. So today we’re gonna hear, we’re here to talk about what are these unexpected big bills that come through.
We’re gonna label them and give them a name and we’re gonna tell you how to budget for them monthly.
So much of what we teach is to help you take the surprise outta the budgeting, the rollercoaster, the. How am I gonna come up last minute with all this money? We know that’s what keeps you stressed.
So we want to take every opportunity we can to get rid of that feeling and that’s what we will do today. We’re gonna explain the annual bills savings bucket. Yeah. It is something that we set up with all of our clients regardless of how many annuals they may have, we set it up with them and help them to take out that rollercoaster of.
Of having these big things pop up that you, you aren’t sure really where you’re gonna get the money from. Yeah. Because the reality is having a $3,000 auto insurance bill, even if you break that up monthly, it’s still a lot of money. So people want to be able to pay for these things and save on the discounts because you get a lot of discounts by paying in full.
Yeah. And, having yearly memberships or sub subscriptions and things, but they don’t know how to budget for them and pay for them in the moment because. Their budget is already so tight, or they think it’s tight. And they’re just spending money randomly. And they don’t have a system. They don’t have a plan in place.
Yeah. So let’s define real quick. What is an annual bill? An annual bill is one of those big bills that, that is that you don’t pay monthly. You might sometimes pay a quarterly. But it just pops up maybe once or twice a year. And it’s bigger. It’s not a monthly bill, but it’s something that you do have to pay every year.
Yeah. So some examples are like auto insurance, like Vanessa said Amazon Prime is one. Property taxes can be one if you, depending on what state you live in you can either have personal property taxes or you might have it in your escrow. Either way, all of these things, car inspections, like your registration that you have to pay.
Vehicle registration. Yeah. I have a new client who has oil. She lives up north and she has to buy oil for her house and that’s how they heat their home. So it’s not propane, it’s literally oil. And so that is a huge expense they have to pay. $1,400. A year for that to be able to keep their, and they can’t let it go out.
If it goes out, that’s a huge deal. So think about all this money auto, I think Shayna said auto insurance. A lot of people have homeowners insurance ’cause they wanna pay that in full ’cause you can get a huge discount. So those are huge expenses and it’s really hard to be able to budget for those in the moment if they come up say, Hey, around Christmas time.
Yeah. Yeah. So like the worst time. So if you’re, if you are able to watch along, follow along looking, we’re gonna try to explain it visually how it looks. So we have a savings bucket and we, what we want you to do is list the name of each annual bill that you have. So you can do this by going back and looking.
You can use our examples and try to jog your memory, talk to your spouse, whatever. But you wanna list each one of them. And then you wanna list. The amount. So the annual amount, how much you pay in a year, not so if it’s quarterly, you’re gonna put the times four. That amount times four.
If it’s oil, like you’re gonna get it filled probably twice a year, you’re gonna list that amount times two in the budget. And then, this is why I started to talk about this, Vanessa. Then you’re gonna put when it’s due. Because you might find out what the problem is. Yeah. You might have all of your bills due in either a July or December.
And you’re wondering like, why was it always feel chaotic in those months? Now, yeah. When you have those big expenses come out at prime times, so like over the summertime when you guys are trying to take vacations and there’s a lot of moving parts and you have. $5,000 worth of annual bills coming out, that’s a huge deal.
And then Christmas, you’re trying to be giving, you’re trying to buy presents and you can’t because you have all these bills due. So we are trying to set up a system for you, so that way we have an account set aside for all of the annual bill expenses that you have coming up throughout the year, and we’re gonna add up the total.
We’re gonna divide that by 12 and figure out if I were to save monthly for this. What does that look like? So I know consistently in my budget. I have the, like these annual bills covered. Yeah. So you will, so we obviously teach you to have a regular Bills account, where your monthly things that you pay for monthly come out of.
We actually want this one to be separate. So that you know that the Bills account can be clean and be marked off each month and it’s nice and neat. And then you have the big bills. You have money pulling up over their. For whenever these big bills are gonna come due, you have the money to pull and pay for it.
And there’s no big hurt to your monthly budget. So you’re gonna have a separate account, you’re gonna name it annual bills, and then you’re gonna be transferring automatically this certain amount that you come up with. Like we said, you’re gonna add everything up divided by 12 and that’s how you know how that is actually going to be a savings bucket.
Try line item in your budget. For annual bills. Yeah, and I wanna reiterate here that if you are not at a place yet, that you can add annual or you can add savings buckets to your budget. You have to be able to add this one. Like this one is a non-negotiable. Why? Because it’s a bill. It has a due date, just not a monthly due date.
And these things will come due. Like my client with the oil. It absolutely cannot go like that. Tank can’t get emptied. If it does, they have to buy a whole new tank. Your vehicle registration, you have a car that you have to drive to work, therefore you have to, it has to be registered so you don’t get pulled over and get a ticket.
Homeowner’s insurance. We live in Florida, lovely hurricanes. You need to be able to be current on all these bills and you can’t be delinquent. So these bills are very important to put in your budget and make sure that you account for them.
And so you’re gonna, you’re, like we said, you’re just gonna put the annual amounts and then your budget or our budget system@budgetbesties.com slash budget will help you figure out the amount.
So in, in the case of this. Particular budget that we’re looking at. They have Prime, Amazon Prime, they have Walmart plus they have Costco. Look, they got a lot of memberships. Okay. And they wanna pay for them annually because they save money. They also have oil. Like Vanessa said, they have their auto insurance card registration, EPAs, which is their toll payment.
So they also pay for their water twice a year. I’ve never heard of that before. So that’s a lot of money. Yeah. That is also in there. Yeah. So they have come up with the amount of annual bills they pay is $8,000, and so their monthly budget’s gonna be 6 68 is what they’ve come up with.
And so then if we go over to their budget, then we would see 6 68 is actually coming out of their their monthly budget to go into their savings account. Yeah. And so this is saying. Here’s my budget with all my income, all my debt payments, and my regular bills that are getting paid out of my current bills checking account.
But I’m also saving $668 every month into an annual bills savings account that all the money is pooling into. And then whenever those bills come due, you transfer the money from annual bills into your bills account, and you pay the bill. Yeah. And you might be tempted to round up to 700. We would not hate you for that.
We would not. Yeah. We would not be mad at you. ’cause they always go up. Yeah. They always, you know that. Always. Yeah. And so the other thing here to think about though is like Vanessa said, we do start our clients with the annual bills, but that doesn’t mean they can afford to save $668 every time.
So what you might need to do is figure out which ones which ones are coming due and how much you can I get enough in this account to pay when it’s coming in three months from now or whatever. You might have to finagle it if you don’t have the perfect scenario. Like the perfect scenario for this would be, oh, I have $8,000 already saved up.
Here it is. I’m gonna put it in my. I’m gonna put it in my account and then I’ll just be funding it. That would be the best case scenario, whatever. We understand that’s probably not gonna happen. I don’t think we’ve ever had that. Yeah, I think you’ve had one. I’ve had several people like that.
You’ve had a couple clients. Yeah. I’m just saying the, I have never had any clients, angel clients that can fund their savings buckets. It’s fine. But then the other thing is you might get to. You might come in and you have three months till one of the bills is due, six months till the next, and then you’re just gonna, you’re gonna have to do a little extra math.
But and see, okay, actually I don’t have 12 months for this one. I only have three. And then you’re gonna do that math, you’re gonna, you’re gonna set it aside, and then once that bill’s paid you can start back with a 12 month mark. Yeah. So for instance, if you have a $1,200 auto insurance bill coming due in three months, you need to save $400 a month, not a hundred.
Right. 400 a month between now and then to make that full payment. And then as soon as that payment goes through, then you can, like Shana said, start saving just a hundred bucks a month, which will really free up your budget. Yeah. But coming up, having to save $400 a month versus 1200 in that one month is really gonna feel much better, I promise.
Yeah. So if you can really try to get your, at least like your first bucket that you do besides your emergency fund, is get this annual bills set up and going as fast as you can. Yeah. And the o the only other tweak to that, and we’ve said it before, is. If you can at least start with what you can. And if you have to fill some of that with your monthly budget, let’s say you have a thousand saved up, but the payment’s 1200 and you need to get 200 from your budget.
Like you can do that eventually. It’s still better. Yeah. It’s still better having a thousand saved up. Is way better than having zero saved up, right? So just understand like the perfect scenario is you’re able to save the exact amount every month and that everything comes due and it’s all already been saved up for You might have a little tweaks in the very beginning of your budgeting process to get to that point.
But it’s gonna be so worth it. Knowing all of that money is set aside. You’re gonna love it. And we hope that you’ve set up your annual bills savings account, separate savings account today. Yes. And if you’ve loved if you guys are that are watching visually, if you’ve loved looking at our savings bucket tracker and our budget, go to budget bus 📍 use.com/budget and check it out.