What Are Sinking Funds?

A sinking fund is money you set aside each month for expenses that don't happen monthly but will definitely happen. Instead of scrambling to find $600 when your car insurance bill arrives, you've been putting aside $50 a month.

Common Sinking Fund Categories

Think about everything that happens less than monthly but more than rarely. Car maintenance and registration. Medical copays. Holiday and birthday gifts. Travel. Annual subscriptions.

Setting Up Your Sinking Funds

Start by listing all your irregular expenses from the past year. Then calculate how much you need to save monthly for each: annual expense divided by 12.

Track Your Progress

Spendify can help you monitor your sinking fund balances and track progress toward your targets.