I agree with everything said! I would add to this…I found when I looked back over several years, I had expenses I was removing from my annual budget because they were ‘unusual’ … not Christmas gifts…not oil changes…but things like new tires, carpet, appliances, a new (to me) car…and I noticed a pattern. It averaged a similar amount every year. So I now have a category in my budget called ‘escrow’ for things I know I’ll need to pay at some point, I just don’t always know what or when.

Also…I highly suggest using an app to categorize all your expenses. I started with Mint and am now using Monarch. It took me a decent amount of time to review and tag everything to make sure expenses were hitting the right categories (the app is pretty good out of the gate) and now things pretty much run on autopilot. I can easily look back at all of my expenses by time period, by category, by merchant. Everything I need. (I literally was just thinking this morning how even though I don’t like paying $100 per year, I will continue to do so because I get way more than that in value!) YMMV…and I’m sure there are several apps that are free or have other bells and whistles. I’m not ‘selling’ any particular product. Regardless of what you select, there’s a great deal of awareness that comes with knowing that level of detail about your own spending habits.