It’s halfway through the month, and you feel pretty good about your budget. All your expenses are accounted for, and you even have some money left over for fun — but then, BAM.

Your Costco membership renewal is due, and suddenly, you’re scrambling to put together the extra cash.

These periodic expenses follow a set schedule, such as quarterly, semi-annually, or even annually, but because they don’t occur monthly, they can be easy to forget.

Other examples include property taxes, insurance premiums, yearly subscriptions, and tuition payments, which, if you’re not prepared, can throw your budget off track.

Fortunately, some extra planning, you can learn how to budget for periodic expenses so you won’t be caught off guard again.

What are periodic expenses?

Periodic expenses are those bills that don’t appear every month, so they’re easy to overlook. They could occur every couple of months, semi-annually, or even once a year.

Here are some common periodic expenses to watch out for:

• Insurance premiums (home, car, life, etc.)
• Property taxes
• Warehouse memberships
• Yearly subscriptions (magazines, apps, software)
• Gym or fitness memberships
• Tuition payments
• Gifts (holidays, birthdays, anniversaries)

So, how should you handle these types of expenses? Do you just pay them as they arise, or include periodic expenses in your budget?

While they may seem to pop up out of nowhere, you’ll have to pay them eventually, so adding them as budget categories makes sense.

How to budget for periodic expenses (a proven method)

Once you know what a periodic expense is, you’ll start to see them everywhere:

• You receive your property tax bill in the mail.
• Your car needs another oil change. Didn’t you just take it in like a month ago?
• Your anniversary’s coming up, and you decide to treat your partner to dinner and a movie.

And don’t even get us started on Christmas… 😭

But here’s the good news: you can plan for periodic expenses with a magical tool called… (drumroll)… budgeting!

Here are some steps you can take:

1. Make a list

Your first step is to write down all those pesky costs that don’t appear in your regular monthly budget.

If you can’t remember them all offhand (which, let’s be honest, you probably won’t), you can check your past bank and credit card statements.

If you’re budgeting with Lunch Money, the process is even easier. Lunch Money can auto-detect non-monthly (and monthly!) periodic expenses over time.

Alternatively, you can pull up your banking transactions in the app, filter out your monthly recurring transactions, and then choose your preferred timeframe, e.g. current year, previous month or year, custom date range, etc.

In the above example, we’ve chosen to list all non-recurring transactions in 2025. Once you apply the filter, sorting the transaction list by “payee” to get an alphabetical list will quickly surface the expenses that may be periodic expenses.

2. Add them together

Alright, you’ve listed all of your periodic expenses. Get out your calculator because it’s time for some math (hurray!).

Add all the expenses you wrote down in step 1 to find your yearly periodic expenses.

3. Divide it up

Take that yearly total from step two and divide it by 12. This will tell you how much you should set aside monthly for periodic bills.

If you budget biweekly, however, you’ll want to divide it by 26 instead of 12 (52 weeks ÷ 2 = 26).

4. Create a sinking fund

A sinking fund is an account you use to save for future expenses.

Once you know how much you need for periodic costs throughout the year, you can allocate a portion of your income to your sinking fund each budgeting period — similar to pay yourself first budgeting.

That way, when your Amazon Prime subscription is about to renew or your best friend’s birthday is coming up, you can simply withdraw the money you need from that account.

Pro tip: Open a separate bank account just for your sinking funds. If you’re using Lunch Money to budget, you can view the account on the Lunch Money dashboard, and easily keep track of your transactions.

Example of how to budget for periodic expenses

As mentioned above, start by listing all your periodic expenses. Then, add them together to get your yearly total. Here’s what it might look like:

Now, divide your yearly total of $4,800 into 12 months. Or, if you budget biweekly, divide it by 26.

$4,800 ÷ 12 = $400
OR
$4,800 ÷ 26 = $184.62

In this case, you’ll need to set aside $400 each month into your sinking fund, or about $184 every other week for biweekly budgeters.

Should you include periodic expenses in your budget?

Absolutely! By figuring out how to budget for periodic expenses, you’ll have a clearer view of your spending. And you’ll never have to panic again when your annual car insurance or quarterly gym membership renews.

That is, unless you like living on the edge, with surprise bills around every corner (no judgment here). But we’ll take a wild guess and say you probably don’t want that.

Remember that Lunch Money lets you add a special budget category where you can set money aside for periodic bills. Sign up today for a free trial to check it out!