With prices around us ever increasing, it is critical to determine what our biggest financial priorities are and what we can eliminate from our overall expenses. For example, housing or our mortgage could be our biggest priority (especially with rate increases throughout the last year from the Bank of Canada) or, it could be a vacation we are prioritizing so that funds are allocated for the totality of the trip, preventing any debt from being incurred while away on our travels.
It's important to take the time to write down what our priorities are and allocate funds to these financial priorities on a timed schedule. For example, if you know you'll be traveling in December 2023, there are 10 more months until December. So you take the total amount you'll need for the vacation, say it's $10,000 and divide it by a timeline of 10 remaining months. This would amount to a savings of $1000 per month for 10 months for a total of $10,000 to use for the totality of the vacation by December 2023.
I've used this technique for years, whether it's saving up for a trip to Asia, or saving up for a book I'd like to read that isn't available at the library. Living out our financial priotities by creating a timed schedule of how much and when we are going to save makes life so much easier when it comes time to make the big purchase. Try it out. Let me know how it goes. Signed, Filipina Budget Girl.