Every sinking funds list you’ll find online is somebody else’s list. Twenty-five categories, alphabetized, copied from the last one. Car maintenance, Christmas, dental, eye care, gifts, home repair, and on down to things like “hobbies” that nobody has ever actually put money aside for.
You can’t use someone else’s list, and the reason why is the most useful thing in this post. But you do need a starting point, so here’s mine — and then the test that tells you which of these belong to you and which don’t.
The test: certain, but not scheduled
There are three kinds of money leaving your account, and only one of them is a sinking fund.
Certain and scheduled. Rent, the car payment, your phone bill. You know the amount and you know the date. That’s not a sinking fund, that’s a bill. It belongs on a bills page and it needs no saving toward.
Uncertain. Losing your job. A roof that fails. The things that would genuinely change your life if they happened and might never happen at all. That’s what an emergency fund is for, and it’s a different animal — one pot, no categories, don’t touch it.
Certain but not scheduled. Your car will need tires. Christmas will happen in December, as it does every year. The cat will need the vet at some point and it won’t be convenient. You know these are coming. You just don’t know exactly when or exactly how much.
That third group is what sinking funds are for, and it’s the only group.
Most lists you’ll read fail this test in both directions. They include bills, which don’t need a fund. And they include emergencies, which need a different kind of fund entirely. Anything that isn’t certain-but-unscheduled is in the wrong place.
The categories worth having
Not a complete list — a starting list. Each of these passes the test for most people.
Christmas and holidays. The single most predictable financial event of the year, and the one people are most reliably surprised by. It arrives on the same date annually and has done for some time.
Car. Not the payment — that’s a bill. This is tires, brakes, the service, the thing the mechanic finds while doing the service. If you own a car you will spend money on it this year that you haven’t planned for.
Medical and dental. Whatever your insurance doesn’t cover. The deductible, the copays, the dental work that gets described as “we should keep an eye on that.”
Home. Renters need a smaller version of this than owners, but both need one. Appliances, repairs, the deposit you’d like back.
Gifts and occasions. Birthdays, weddings, baby showers, the leaving present for someone at work. Individually small, collectively a real number, and always at the wrong moment.
Annual renewals. Insurance paid yearly, car registration, professional memberships, the subscriptions that bill once a year and feel like an ambush. These are technically scheduled, but they’re lumpy enough that spreading them monthly is the whole point.
Travel. Only if you actually travel. If you haven’t taken a trip in three years this isn’t a sinking fund, it’s a wish.
Pets. If you have them. Routine care is predictable, everything else isn’t, and vets are expensive in a way that surprises people every single time.
That’s eight, and most people won’t need all of them.
If you want the other half of this — how much to actually put in each one, worked out from your own numbers rather than a percentage rule — I’ve written that separately in Sinking Funds: How Much to Actually Save for Each One.
The one nobody puts on the list
Things that break.
Not a specific item. The washing machine, the laptop, the phone screen, the thing in your house you haven’t thought about because it currently works.
Every list online skips this, presumably because it sounds vague. But it passes the test perfectly: you are certain that something will break this year, and you have no idea what or when. That’s the definition.
It also tends to be the fund that saves you, because a broken washing machine on a Tuesday is exactly the kind of thing that puts a month onto a credit card.
Call it Replacements if Things That Break feels too blunt for a page you’ll look at every week.
How many is too many
Six to eight is the range that survives. Beyond that you’re not budgeting, you’re doing admin.
The reason is the same one that kills over-categorized budgets: every fund is a decision you have to make each month about how much goes in, and a decision at the moment of spending about which one a cost belongs to. Is a new tire Car, or Things That Break? With eight categories, the answer is usually obvious. With twenty it’s a judgment call every time, and small repeated friction is what quietly ends a system.
If you’re not sure whether something deserves its own fund, the question isn’t “could this expense happen?” — almost anything could. It’s “has this wrecked a month for me before?”
Now make it actually yours
This is the part that matters, and it takes about twenty minutes.
Open your bank statements and go back twelve months. Not this month — a full year, because sinking funds are for things that happen annually and you can’t see them in a thirty-day window.
Look for the months where the number was wrong. Where you spent noticeably more than usual and it wasn’t a holiday or a treat. Then find what caused it.
You’ll usually find three or four culprits, and they’ll be specific to your life in a way no online list can be. Someone with an old car and no pets has a completely different sheet from someone with two dogs and a new lease. One of you needs a serious Car fund; the other needs Vet and doesn’t need Car at all.
Those months are your list. Everything else is optional.
There’s a second thing worth doing while you’re in there: write down the amount, not just the category. “March, $680, car” is a real number you can divide by twelve. “Car maintenance” on its own is a category with no size, and a fund with no target is just a vague intention.
Where the money actually lives
You don’t need eight bank accounts. Some people do this and it works, but it’s a lot of administration for the benefit.
One savings account, and the categories tracked on paper. The bank shows one balance; your page shows what that balance is made of. When the vet bill comes you look at the page, see the Pet line, and take it from there.
This sounds less rigorous than separate accounts. In practice it’s more sustainable, because opening an account creates friction and friction is what kills systems. The page is what does the work.
The thing that goes wrong
You’ll raid one fund to cover another. Everyone does, and it isn’t the failure it feels like.
The mistake isn’t taking $200 from Travel to fix the car. The mistake is not writing it down. A fund you quietly borrowed from is a fund you now can’t trust, and once you can’t trust the page, you stop looking at the page.
Write it down. “Took $200 from Travel → Car, March.” Two seconds, and it keeps the whole thing honest.
Three months of annotated, corrected, slightly messy pages will tell you more about your actual life than a year of tidy ones that stopped being true in week two.
Getting it on paper
None of this requires a printable. A notebook works.
What a proper sheet gives you is the structure already decided — the categories laid out, a target next to each one, a column for what’s in there now, and space to note what you moved and when. The difference between a blank page and a form, which is the difference between meaning to and doing.
That’s what my Sinking Funds Planner is for. Five pages, printed at home, kept wherever you do this.
Start with your own twelve months. Find the three months that hurt. Those are your first three funds, and they’ll be worth more than any list you could copy.
— Richard