Sinking Funds
Some budgetteers call debt and savings by some funny names. One of these that I hear from time to time is 'Sinking Funds'. A sinking fund is (according to the Oxford English Dictionary) is: - a fund formed by periodically setting aside money for the gradual repayment of a debt or replacement of a wasting asset. So for example, when you purchase a fridge, once it arrives in your home you begin saving for the next fridge. This could mean that when you go to purchase a replacement fridge, that you would have the cash to buy it with. It is a good idea in principle, but how far does this go? When you buy a waterproof jacket, do you begin a sinking fund for your next jacket? When you buy the kids' school uniform, do you then begin a fund to pay for the next one? - this one makes sense. So, I thought I'd have a bit of fun and think about if we had 'Sinking Funds', what would we use them for? - fridge freezer. We bought a brand new fridge-freezer w
