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Are these unexpected expenses eating your cash?

We’ve all had that sinking feeling of logging on to our Internet banking account or opening a bank statement and realising we have a lot less in there than we think. But what exactly is eating up your money and how can you gain back control?

The average person could be forking out £620 on unpredicted expenses a year, which could take up to 16 months to pay off, according to loan provider Provident. These costs can hit up to four times each year – but despite this, 57% said they don’t budget for the unexpected in their monthly income.

So what are those  surprising expenses and how can you be prepared for them?

Surprising costs revealed

Cars are the main culprit when it comes to unexpected expenses in the UK, setting people back £142 on average per year.

However, one in five admitted that when their car incurred surprising costs they left it until it steadily got worse. Easy to do – but not kind on yourself or your wallet!

Your moggy or hound could also be giving your purse an unexpected pounding as well. Perhaps surprisingly, Scottish respondents are the worst for this with 8% having to spend between £300 – 500 in unexpected pet expenses last year.

What can you do about these expenses?

Firstly, do not hesitate on any unexpected costs. Waiting, such as with a car or a household bill, often just makes things deteriorate more.

Secondly, if you can, put money aside every month as an emergency fund and try s hard  not to touch it. This is the hardest advice to follow but also the most fruitful. If money is short, start small. Saving £3.00 a day adds up to £1,095 a year.  Some people may find it easier to build up the habit of putting aside something seemingly small every day rather than putting aside a larger amount every month, which you may end up dipping into.

Also, consider the benefits of insurance. Only 10% of respondents said they would rely on insurance to cover their unexpected expenses, but it could be a lifesaver in times of trouble.

Be honest… do you do this?

There are lots of factors why you may find it difficult to save – but are you sometimes blind to your own spending? A significant 31% of us have fallen into debt following a payday spending splurge, according to loan agency Wizzcash.  The most popular ‘payday treats’ include booking holidays, food and clothes shopping.

If you find yourself getting in the trap of a payday splurge and then running out of money by the end of the month, then you need to break the cycle.

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