Instructions For Using College Financial Planning Worksheets (Page 2 of 2) in pdf

What are “Hidden Costs”?

Many expenses occur on a regular monthly basis. Examples of these are housing, utility bills, and food costs. However,

every household experiences periodic or non-monthly costs that are “hidden” from the monthly look at your income

and expenses.

Examples of hidden costs could include costs at the beginning of school or a semester, car tags and taxes, expenses for

birthdays or holidays, trips that occur a few times per year, and perhaps many others. Everyone experiences hidden

costs and everyone has a different list. If you plan for your hidden costs you will be able to determine how much money

that needs to be set aside for expenses that cause some household “budgets” to fail.

You will see the Hidden Cost column on the expense tracking spreadsheet. The challenge is to estimate your yearly

hidden costs, add them together, and then divide that total by 12 so that you’ll know what your average amount for

hidden costs is every month. That’s the easy part. Now put that figure on the $_____ line at the top of the hidden cost

column. For example if someone found their yearly hidden costs were $1,200 then their monthly figure would be $100.

The real challenge is to find a way to set aside your hidden costs figure every month, perhaps in a separate savings

account. Record the date or dates of the month, on the expense tracking spreadsheet, that you set aside money to the

hidden cost fund. Try to set aside the amount you’ve written at the top of the column every month. This is not an

emergency fund. Emergencies are events that you can’t plan for but happen to everyone. Other funds set aside in

savings should be for emergencies. Make a list of your hidden costs here:

Hidden Cost - Name

Hidden Cost - Amount

________________________

Total Costs for the Year

________________________

Divide the Total by 12

________________________ This is the amount you need to

set aside every month. Put this amount at the top of the Hidden Cost column on the expense tracking spreadsheet.

Instructions For Using College Financial Planning Worksheets Page 2