Do you have a Freedom Account?

Many years ago Kevin and I set up a Freedom Account. This is a separate account to handle irregular or non-monthly expenses. Rather than trying to cashflow the car insurance premiums twice a year, we set aside money each month into a section of our Freedom Account to cover the 6 month bill when it arrives. Instead of trying to squeeze the money for a summer camp out of our regular budget, I have a section for kids activities. I set aside money each month to cover the irregular stuff that comes up, like scout camp once a year or the baseball fees I paid in February.

We have sections in our Freedom Account for car repairs, home and yard maintenance, kids activities, vacations, medical, pet things (this doesn't cover food, but vet visits), trash and sewer (paid quarterly), Christmas gifts, etc. When I started saving money to replace the roof I started saving it in our Freedom account - I just started a new page for the roof money. In the past we have had sections for home owner dues, life insurance policies, clothing (I now do the envelope method for that), our beach vacation, and furnace repairs.

You could set up a section for anything you want. In fact Kevin and I each have a section for just us. We only put $10 a month into each section, but you would be surprised how quickly it accumulates. We use it to cover the occasional splurge or unplanned want. I will frequently use mine to buy scrap booking supplies. When Kevin wanted to start making his own beer, I certainly didn't want to come up with $150 out of our regular budget for beer supplies LOL. I checked his account and he had money in there to cover it. We were both happy with this solution.

I have said it before and I will say it again. Having a Freedom Account set up to cover irregular expenses has almost completely eliminated the need to use our Emergency Fund. Repairs to your car and home will need to be done at some point. Saving money towards those each month, means that when the washer breaks down and needs to be repaired, you have the money set aside and it isn't really a financial emergency at all. It takes a lot of stress out of life, which is never a bad thing. Do you have a Freedom Account?