Get on top of planned expenses with sinking funds

By AMANDA BARROSO of NerdWallet

Mapping out planned expenses like vacations, holiday gifts and membership renewals in advance gives you time to save in smaller chunks. “Sinking” your funds into buckets created for each savings goal is one way to avoid feeling overwhelmed as the deadline approaches. Once you set your deadline for a particular expense, work backward to figure out how much you need to save each month to meet that goal. Adding to your sinking funds each month can not only make goals manageable but also help you avoid going into debt or pulling from your emergency fund.