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Averaging out your monthly household bills

One of the dangers of budgeting your monthly household expenses is that some of them fluctuate over time. If you make your budget based on summertime electricity usage, but in the winter it goes up four times because you are heating your house, you have inadvertantly sabotaged your budgeting, unless you have taken the added winter expenses into account. Likewise, if you live in a hot climate, the summer electricity bill could skyrocket if you are using your air conditioner 24 hours a day.

When you sit down to do your monthly budget, be sure to take into account fluctuations. If you do not have your previous months bills, simply contact the utility company in question and ask for your yearly average per month or the totals of the previous twelve months. That way there won't be any surprises.

To average out your monthly expense for each, simply add up the previous 12 months bill totals, and divide by 12 to get the average you spend per month.

 



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