The core idea
Some costs don't happen every month, but they're still predictable. You know roughly when they're coming and roughly how much they'll be. The simplest way to stop them disrupting your budget is to estimate the annual cost, divide it by 12, and set that smaller amount aside every month, so the money is already there when the bill actually arrives.
Common examples
- Annual insurance renewals (car, home, pet, travel)
- Car servicing and MOT
- School-related costs
- Christmas or other seasonal spending
- Subscriptions billed annually rather than monthly
- Household repairs and maintenance
- Annual professional fees or memberships
These are illustrative examples, not a claim that every household has all of them. Your own list will depend on your circumstances.
A simple worked example
If your car insurance renews once a year at £600, setting aside £50 a month (£600 ÷ 12) means the full amount is already saved by the time the renewal bill arrives, rather than it landing as a single unexpected cost in one month.
This works alongside your regular budget
Treat the monthly set-aside amount as its own regular expense line alongside your normal monthly bills, the same way you'd enter any other expense in the Budget Planner. See how to build a monthly budget for the wider method this fits into.
What this doesn't cover
This is a way of planning ahead for costs you already expect. It isn't debt-repayment guidance, investment advice, a credit-product recommendation, or mortgage-affordability advice, and it isn't personalised financial advice.
Plan it in your own budget
The Budget Planner lets you enter irregular costs at whatever frequency they actually occur, including annually, and it converts them into a genuine monthly figure automatically, alongside the rest of your income and expenses.