I feel like there is a bit of a contradiction here... You first mentioned how before diving into Bitcoin, you always set aside some money for an emergency fund, and that it is been incredibly helpful for financial challenges we can not predict, which honestly makes a lot of sense… But then later, you are also talking about using that same emergency fund for your child’s school expenses...
Now, school expenses are not exactly an unexpected emergency, they are more of a planned expense you can anticipate months in advance.. So if you start dipping into the emergency fund for planned costs like school expenses, then you might not have it when a real financial challenge comes knocking…. I am not saying your plan is bad sha, but maybe it would be better to keep the emergency fund strictly for true emergencies, and have a separate future needs fund for things like school expenses and all…
I would guess that when you have a child, there are unexpected expenses from a child as well. Meaning, like lets say there is a school trip, and takes a good chunk of money, that would still be unexpected. Doesn't mean they have to go, but it is still nice to give your kids that experience when they are young so it would shape them to be better later in life.
It's important to realize, kids are unexpected expense machines, not just even school, everything in their life is an unexpected expense and you end up with spending more than you calculate. Anyone who has a child can tell you 100% true that you can calculate at the start of the month how much everything costs and make a calculation, and then at the end of the month you realize you spent more than you calculated because of them.
I get where you’re coming from because the reality is, once you have kids, even the most perfect budget can turn into a moving target. . You might set aside what you think is enough, but then a random thing comes up and suddenly you are adjusting, That is just part of the parenting game…
But, I think the main challenge is not about whether these expenses are real or not, they definitely are, but about how they are managed without disturbing the foundation. If every little unplanned cost ends up being pulled from the same pot meant for emergencies, then when a real financial crisis hits, you might find yourself empty handed…
I am not sure what the differnce between the expenses of children, spouses or even businesses. There are going to always be ways in which our cashflows become more complicated whether we are referring to the income, the expenses or to both.
The safer way to budget would be to provide extra budget and perhaps including calling it float, so if you keep your float at a higher level then you have more likelihoods of capturing all of the expenses, and then perhaps having more money at the end of the month than you had expected rather than having less than what you expected.
It seems to me that the building and maintaining of strong cashflow management would attempt to error on the side of not getting caught with your pants down so you would rather have extra money at the end of the month rather than not enough.. and sure if the expenses become just way too difficult and sporadic because there are are several kids, a spouse and maybe one or two other members of the extended family on the support system... so then maybe there would be a practice of keeping an extra slush fund of $300 to $1k that is just for the unexpected family-related expenses purposes. There also could be an approval problem, since maybe if you are the one who has to approve all expenses that are more than $50, or maybe your spouse is the person who makes the final approval. I doubt that any family just gives a blank check to child expenses merely because the child is the greatest thing since sliced bread. On the contrary it seems important to figure out reasonable limitations whether referring to kids, spouse and/or other family members. Similar kinds of difficulties with income and/or expenses are likely to happen in relation to carrying out a business, and surely some businesses have more complicated/unreliable cashflows than others... yet each of us still would be attempting to bring into control and/or to put appropriate limits on certain expenses and even making sure that income is collected without allowing cash receivables to linger for long periods of time.
I like the way you placed this with the idea of a float or slush fund. It is a much more disciplined way to handle unpredictable expenses without constantly blurring the lines between necessary safety reserves and day to day budget shocks..
U kw this principle applies beyond just family life, business owners, freelancers, or anyone with variable cashflow can benefit from this same system.
The big win with your approach is that it shifts the mindset from reacting to expenses towards anticipating them.. Having that extra cushion means you are not scrambling or making emotional money moves just to cover something unexpected. And in the long run, it is the habit of over preparing, even slightly that keeps your financial thing steady, whether you are dealing with kids, a spouse, or the occasional sector life throws your way.