TCH Daily · Money
How to set up sinking funds — UK household method
Sinking funds turn annual shocks into weekly boredom. That is the point.
Eight moves. Predictable pots.
- List the shocks. Christmas, car MOT, holidays, kids' birthdays, boiler service.
- Annual cost divided by months. £600 Christmas / 12 = £50 monthly.
- Pots or envelopes. Bank pots named. Not one vague savings.
- Payday fill. Same morning as rent. Non-negotiable.
- Spend only from the pot. Christmas comes from Christmas pot. Not the overdraft.
- Review twice yearly. Costs change. Adjust.
- Start small. £10 pots beat perfect maths you never fund.
- Payday pack. UK Payday Budget Pack includes sinking fund lines.