Mapping out your fixed costs

Fixed costs are boring, and boring things are hard to remember. You remember the energy bill and the rent, because they hurt. The insurance that leaves your account once a year, the €2 increase on a subscription you took out four years ago, the second streaming service someone else in the house uses: those drop out of sight.

And the pattern isn't random. What you forget is almost always an expense, and almost never income. That is why the estimate is consistently too rosy, and why "there's nothing left" feels true but doesn't add up on paper.

You don't have to do any of this from memory. There are three places where the full picture already exists, and together they cover almost everything.

• Your bank statements for the last twelve months. Twelve, not three. Anything charged once a year (insurance, memberships, the municipal tax) won't show up in a quarter.
• The direct debits (domiciliations) at your bank. Most banking apps have a separate overview of standing orders and direct debits. That is the shortest route to half of your list.
• The subscriptions in your App Store or Google Play. They run through your phone account and don't always show up on your bank statement, especially if a prepaid card is attached.

Go through this list when you think you are done. These are the items most often missing in practice.

• Annual insurance premiums: home and fire, family liability, hospitalisation, car.
• The annual road tax and, in Flanders, the property tax (onroerende voorheffing).
• Trade union or professional association dues.
• Sports club, youth movement or music school, usually per season rather than per month.
• Servicing the boiler, and the chimney sweep.
• Domain names, cloud storage, a password manager: small, but not when you add them up.
• The subscription in someone else's name that you pay them back for.

Don't turn annual amounts into a monthly figure in your head. Write them down as what they are, with the month in which they are charged. Otherwise your average is right but your month isn't, and your account runs dry in a month, not in an average.

Once the list is there, it is tempting to sort it alphabetically or by amount. Splitting it into three groups is more useful, because that tells you straight away what you can do with it.

• Fixed and unavoidable. Rent, loan, the insurance you have to have. There is little to choose here, but it is good to know how big that block is.
• Fixed but replaceable. Energy, telecom, bank fees. Same service, different provider, different amount. This is where the money is that you can win back without changing your habits.
• Fixed out of habit. Streaming, apps, that one thing you can no longer remember using. The question that belongs here: when did I last really use this?

Fixed costs are sold per month, and that is no accident. Twelve euros a month sounds like nothing. The same amount is €144 a year, and that is a weekend away. So if you want to understand your list, put a yearly amount next to each item: multiply the monthly amount by twelve, divide a yearly premium by twelve, and convert a quarterly bill to both. Only then are they on the same scale and can you compare them.

The total is almost always higher than expected. Four streaming services at ten euros each come to almost €500 a year, and that is the kind of amount you do make a decision about, while you keep hesitating over €10 a month.

In Budgetto you don't have to work this out yourself. On the Fixed costs page, each fixed cost shows what it costs you over three months, a year, three years and ten years, and at the top you see the monthly and yearly total of everything together. The ten years isn't a joke: a subscription you don't cancel just keeps running, and then the question isn't whether it is worth €12 but whether it is worth €1,440.

A list you make once is out of date a month later. What helps is setting up the amounts once and after that only looking at them.

In Budgetto you add each fixed cost once, with the amount, the frequency and the start date. After that they appear in the overview on their own, and under "Upcoming" you see what will leave your account in the coming weeks. So you don't have to remember a yearly premium in March: in February you simply see it coming.

By default it stops there: the list shows what is committed, and you record your spending yourself. If you don't want that, you turn on Book automatically, one fixed cost at a time. Budgetto then creates the expense itself on every due date, and that cost simply counts towards your balance and your forecast, just like anything you type in yourself. If you leave it off, the forecast only recognises a fixed cost once it has come through a few times as a transaction.

One thing to know if you use that switch: don't enter that cost yourself any more, or it will be there twice. And whatever you already paid this month isn't booked retroactively, so you type that in yourself one last time.

Set yourself a reminder, once a year, to go through the list. Half an hour in January is enough. That is less work than the feeling that the money has run out and you don't know why.

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