How to Pay Cash For Big Expenses - Savvy Savers Academy

How to Pay Cash For Big Expenses


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Ever wish you could slap down a wad of cash to pay for anything you want?

There are numerous reasons why paying cash is so appealing to many people.

  1. You own what you just bought because you used your own money to pay for it, not someone else’s.
  2. You got to pay a better price because you don’t have to pay interest.
  3. You won’t add to your pile of debt. (Even someone who is careful with credit cards can end up in an unfortunate debt predicament if life throws them a curve ball.)​

There are more, but I’ll leave it at that. (You can check out cash vs. credit in our article here)

So making the switch. Is it possible? Don’t know where to begin?

Related: In this article we discussed “money buckets” and the freeing power they possess.

It’s not hard to set up, here’s how.


Make a list of what you’ll have on your plate this year.

​Start by thinking of all the big expenses that come up for you each year. It'll probably be helpful to refer to the following article.

Related: 18 Things You Definitely Don't Want to Forget to Budget For​

Create a savings goal amount for each item on your list.

Figure out how much you need to save.

This can be the hardest part but it’s totally worth the effort! Here are some tips to simplify things a little and get you started:

  • ​Refer to old bills or bank statements to see prior years spending amounts for things like car maintenance or membership rates.
  • Call experts to see what they charge if you are planning tax preparation, yard maintenance or how much new tires would be for your car.
  • Research online to get a good estimate for your vacation or other expensive products you’ll need to purchase.
  • Come up with an ideal amount you’d like to spend on birthdays, anniversaries, and holiday’s.
Add it all up. (I know, scary, right?!)

Once you have a list of your expenses and how much they will cost you per year (gulp), you'll be ready to break it up into bite sized pieces.

Divide by the number of paychecks you receive.

Do you get paid monthly? Twice a month? Every other week? Weekly? Manage your savings goal by saving a little from each paycheck.

It's a good idea to keep track of everything on a spreadsheet. You can use good old pen and paper or a digital version, like so:

You'll need to update the spreadsheet with each paycheck so that you know that the money in your savings has an assignment and where it's intended to go. 

You'll also want to update your spreadsheet anytime you need to cash out on one of your funds.

Some items on your list will be coming up soon, so you have a few options:

  • Accelerate the savings by putting extra into that fund. If you only have 6 months to save, divide by how many paychecks you'll get in the next 6 months.
  • Use extra money you get from selling stuff, work bonuses, tax refunds, a second job or other extra money to fill up your savings fund.
  • Cut expenses in another area and “move” the money to the area you need it most. i.e. If you didn’t need all of your grocery money, you can forgo movie night with the family this month, you didn’t quite need as much as you thought to register the car, etc.

Do you come up short?​

Try not to be discouraged.

It's actually a good thing that you caught on to the fact that you don't have enough money early on. This will help you find a better path to follow so you're not totally overwhelmed when the bill comes due.

If you’ve planned your non-monthly expenses and you can’t quite cover everything with your paychecks, here are some things that might help.

Go back through your list. Are there any items that you can cut out or reduce?
  • Can you plan for a less expensive birthday party? If you reduced Christmas by $100 could that cover a different category?
  • Are there subscriptions that you don't really use like magazines, gym memberships or streaming TV subscriptions?​
  • Could you reduce your budget on a variable category like groceries in order to save for something important like car maintenance? Shifting just $5/paycheck could help you save over $100/year.
Can you come up with extra money elsewhere?
  • Tax return, work bonus, rebate check
  • Do you have anything you can sell that you don't need or use anymore?
  • Could you earn extra money on the side? A few ideas might be waiting tables, tutoring, selling hand-made goods, repairing cars on the side if you're mechanical, referring for local school teams, teaching music lessons, cleaning offices or delivering newspapers.

Do you have a variable paycheck?​

You may think this won't work for a variable paycheck, but budgeting and being prepared in advance is especially important if you have a variable paycheck.

For years my husband had a second job with a variable income. First as a pizza delivery driver then as a server at a steakhouse restaurant. ​

Here are some things you can try that helped us:

  • Determine a minimum amount of money you know you can depend on. We became familiar with trends knew how much hubby should make based on his scheduled days. 
  • Come up with a minimum amount you need to save up for your goals. If you could save up the vast majority of the money you need then it won't be so stressful to pay the rest when it comes due.
  • Use other money to help fill up your funds. This could be tax return money, money from selling stuff at a garage sell, or a second side-gig. (For us the variable income was our second side-gig)

Where to keep your money.

You're probably thinking "a savings account, duh."

This money is not a cookie jar that can be snitched from. It should be respected and allowed to fulfill its purpose.

In other words … don’t touch it! Leave it alone until you need it.

We keep this money separate from our regular budgeted money so that it doesn’t accidently disappear into oblivion.

(Have you ever uttered the phrase “Where’d all my money go?”)

We use Ally Bank which has been rated as one of the number one online banks. It keeps our money out of reach and doesn’t cross paths with groceries, utilities, and rent. (We're not affiliated with the bank other than we have an account with them.)

I know, I can hear some of your grumbles through the internet! Sounds like a pain in the neck to have yet another bank account to keep track of.

If a separate bank account doesn’t work for you, just try a separate savings account.

You can easily keep track of how much money is for what fund by keeping a ledger in an excel spreadsheet.

​You're off to a great start! In the coming months you'll likely recognize how amazing it feels to be prepared and have money set aside to pay for things that are coming your way.

You'll also likely come to rely on this method because it creates total peace of mind.

In the coming months we will be offering a completely automated budgeting and savings solution. Yay for that! Be sure you’re on our email list to be notified when it gets rolled out!


Cameron is a Financial Coach who works with couples and individuals to achieve financial freedom and peace of mind. She believes being in control of money = less stress + more fun! Join her on the journey to think about money less and enjoy life more.