BUDGETING FOR HOBBIES AND ACTIVITIES

WHY IT’S IMPORTANT TO BUDGET FOR HOBBIES

This topic was suggested by a listener, and I think it’s a really great one to talk about because for the most part hobbies and activities often have variable costs associated with them that occur periodically throughout the year. When you are not planning ahead for these costs, these expenses can really end up making you blow your budget when they come up. Plus, it’s really important to understand what your hobbies are costing you. Maybe there are a couple of different hobbies that you like just as much but didn’t realize that one of them costs a lot less to be involved in. If you are looking for a place to save money, knowing the cost of various hobbies can help you make choices to stick with what you can currently afford.

WHAT DO WE MEAN BY A HOBBY?

A hobby can really be anything that we do during our downtime for fun. This might include things like:

• Reading, Cooking, Bike Riding, Crafting, Yoga
• Taking care of or working with animals
• For kids – gymnastics, dance, karate, soccer, etc.
• This list can go on and on!

USE SINKING FUNDS

Pretty much for every expense that I have of this nature where it’s not a flat amount per week or month, I use sinking funds. A sinking fund is where you put aside a certain amount of money per week to save up for expenses that don’t happen on fixed schedules. For it to work, you can’t pull the money for something else – unless you have made the decision you will not use it for its intended purpose. It’s important to have the money segregated and identified what it is specifically for.

HOW MUCH DO YOU NEED?

You will need to think through the entire year for your hobby.  List out all expected expenses for the year in detail. It’s important to be detailed because at some point you might look at what you have saved and think it’s too much, but you may have forgotten that a large purchase will be coming at the end of the year. For example, my hobby is horses (and the listener that requested this episode has a horse too), when I thought about it – this is actually a good example that could be applied to how to think through the year and write it all down. With the horses, we have:

• Spring shots and fall shots, so those only happen 2 times per year
• Hooves to be trimmed – every 6 weeks
• Supplements – some last 3 months, some 4 months, etc.
• Wormer – given periodically during the year
• Emergency vet visits
• Supplies (new halter, hay bag, treats)

Using dance as an example:

• New shoes – probably every year, and possibly different types of shoes depending on the class
• Leotards
• Annual dance class pictures
• Cost of dance costumes, multiple if in different classes
• Tickets to recital

Once you have listed everything out and estimated the annual cost, you can determine how much you will need to put aside each week to cover these costs. Also, consider the timing of when the costs occur. If they are more heavily weighted towards the beginning of the year, then you will need to have been saving up already the prior year.  You don’t want to start saving up in January for a large annual expense that will happen in February.

WHAT IF THE WEEKLY SAVINGS AMOUNT IS TOO LARGE?

That means you can’t afford this hobby or kids’ activity!  If you are struggling to save up for it, then you most likely won’t have the money for the expenses as they come up. Once you have all costs listed out, it can really give you the opportunity to look at what this is costing you and see if there are any changes you can make. For example, with a dance class for a child, maybe 2 dance classes are too much, but 1 is doable.  If they really want to learn different types of dance, have them alternate.

RANDOM TIPS

It’s really important to make sure that your hobby can fit into your budget. You don’t want something that you love to become a source of stress because it is causing you to spend more than you have. Take a break if you need to. If your hobby is more than you can afford, consider taking periodic breaks from it to allow you to save up to cover the cost. You will enjoy the activity much more when you know you can afford it. This goes for kids’ activities too! When your child wants to take 3 dance classes with everyone else, and you have to tell them they can only take one, it can be difficult. However, it’s much more difficult to stress out every time you have to cover the cost of all of those classes if you can’t afford it. It’s also a good lesson to teach the kids about money.  Have them really think about it and choose the class they really want to do the most.  Just because the other kids are taking the 3 classes – doesn’t mean their parents aren’t going into debt for it!

CONSIDER ALTERNATIVES

I have given this tip many times.  I really love to read, but don’t want to spend money on lots of books, so I use the library app for free books. Is there anything like this with the hobby?  Maybe renting equipment if you can’t afford to purchase your own yet?

Thanks so much for checking in! If you would like to hear the podcast version of this topic to check out Lola’s Frugal Life Podcast! Also, be sure to check out my other blog posts on this site!

I would love to have you join my mailing list! Sign up here:

Email address:

Leave this field empty if you’re human: