A sinking fund isn't traditional savings. Instead, it's money that's meant to be spent — the idea is that you already have it set aside when you need it. It's a buckets of savings set aside for significant expenses.
I don't feel guilty dipping into my sinking funds. Unlike my emergency savings, I'm not setting money aside for a worst-case scenario. Instead, it's cash I know I'll need.
Because of this system, I was able to travel all throughout 2022 while simultaneously saving to move to Miami.
You can open up sinking funds for: travel, home repairs, car maintenance, home insurance, property taxes, gifts, clothing, insurance and so much more. Listen to this episode if you want to learn more about how to set these up!
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