Broker Check

Expect the Unexpected

| October 01, 2023

As a financial planner, I am well aware of the meaning of this month’s blog title, “Expect the Unexpected.” We know that unplanned expenses are going to occur, it is just a matter of when. This is something I too experience just like the rest of us so is there a way to be better prepared?

I have two favorite expressions that I counsel clients on continually. The first is that no matter what planning we are doing now, in two years, things will have changed somehow and we should and will need to make adjustments.

The other is expect the unexpected! The best test is to look back on your unexpected expenses listed in your check book over the last 12 months. You’ll start to see that it is not so "unexpected" and it’s more like clockwork. Here is what most people do. They put together a budget for the month and then at the end of the month it is no where near what was planned.

Pie in the Sky Budget

Income                   $6,000

Expenses              - $4,500

Savings                 $1,500


Reality Check Budget

Income                               $6,000

Expenses                          - $4,500

Unexpected Expense        - $3,200

Savings                             ($1,700)

I like this example because this past month, $3,200 was the cost of my new “unexpected” water heater. I hope the takeaway here is that we all need a secure, reliable source of savings that is liquid and accessible to help weather the storm. Trust me, there will always be another storm so let us help you be ready for the next one.