How do I save for rego, car insurance and other big yearly bills?
Add up every bill that only turns up once or twice a year, divide the total by 26 if you're paid fortnightly (or 52 if weekly), and move that amount into a separate pot every payday. That pot is a sinking fund. If a bill is due soon and the pot is empty, divide that one bill by the pays you have left until it's due, then drop back to the normal amount once it's paid.
The short version
- Moving $213.46 into the sinking fund every fortnight covers all five bills over a full year.
- They put aside $85 a fortnight for rego until it's paid, then drop back to $32.69 for next year's renewal.
- Some states let you pay rego for a shorter term, and many insurers offer monthly instalments. These can help with cash flow, but check whether paying in smaller chunks costs more in total over the year.
The rego renewal lands in the letterbox, the car insurance email turns up the same month, and suddenly a normal fortnight has a $2,000 hole in it. It feels like an emergency every single year, even though you knew it was coming.
That isn't a willpower problem. Big yearly bills are just badly shaped for a fortnightly pay. A sinking fund reshapes them into a small, boring amount that comes out every pay, so the bill is already sitting there when it arrives.
What a sinking fund actually is
A sinking fund is money you put aside, a little at a time, for a cost you already know is coming. The bill isn't a surprise, only the timing is awkward.
It is different from two things people often mix it up with.
- Savings goals are for things you choose, like a holiday or a new couch.
- An emergency fund is for things you can't predict, like a car breakdown or losing shifts.
- A sinking fund is for bills you can predict to the month, like rego, insurance, a car service or school costs.
Keeping them apart matters. If rego comes out of your emergency fund every year, you don't really have an emergency fund, you have a rego fund with a nice name.
Step one: list every bill that isn't monthly
Grab last year's bank statements or email receipts and write down anything that came once a year, twice a year or quarterly. The usual suspects:
- Car rego, plus CTP or a green slip if your state bills it separately
- Car insurance, and home and contents or renters insurance
- Car service and tyres
- School fees, uniforms and book lists
- Christmas and birthdays
- Yearly subscriptions, memberships and the pet's vaccinations
Use the real amount from last year's bill and round it up a little. Insurance renewals have a habit of creeping.
Step two: turn the yearly total into a per-pay amount
There are 26 fortnights in a year, not 24. So the maths is simple: yearly bill divided by 26 for fortnightly pay, or divided by 52 for weekly pay. Dividing by 24 (two pays a month) puts aside more than you need, which is safe but ties up money for no reason.
Worked example
Josh and Tara's car and home bills
Example only. Josh and Tara live in Penrith and are both paid fortnightly. These are example figures for their yearly bills: rego $850, green slip $550, car insurance $1,300, a car service $450 and home and contents insurance $2,400.
| Step | Sum | Result |
|---|---|---|
| Add up the yearly bills | $850 + $550 + $1,300 + $450 + $2,400 | $5,550 a year |
| Divide by 26 fortnights | $5,550 / 26 | $213.46 a fortnight |
| Or, if paid weekly, divide by 52 | $5,550 / 52 | $106.73 a week |
| Check it by bill | $32.69 + $21.15 + $50.00 + $17.31 + $92.31 | $213.46 |
Moving $213.46 into the sinking fund every fortnight covers all five bills over a full year.
Example figures only. Rego, CTP and insurance costs vary by state, vehicle and insurer.
You can round each amount up to the next whole dollar if that is easier to remember. In Josh and Tara's case that gives $216 a fortnight instead of $213.46, and the extra few dollars become a small cushion for price rises.
What if a bill is only a few months away?
This is where most people give up. You start a sinking fund in October, but rego is due in March and there's nothing in the pot. The normal per-pay amount won't get you there in time.
The fix is a short catch-up. For the bill that is close, divide the full amount by the number of pays left until it is due. Pay that higher amount until the bill is paid, then drop that bill back to its normal per-pay amount for next year.
Worked example
rego is due in 10 fortnights and the pot is empty
Example only. Josh and Tara start their sinking fund with nothing saved. Their $850 rego is due in 10 fortnights.
| Step | Sum | Result |
|---|---|---|
| Catch-up amount for rego | $850 / 10 pays | $85 a fortnight |
| Normal amount after it's paid | $850 / 26 | $32.69 a fortnight |
| Extra while catching up | $85 - $32.69 | $52.31 a fortnight |
They put aside $85 a fortnight for rego until it's paid, then drop back to $32.69 for next year's renewal.
Do the same for any other bill that is close. Bills further away can start at the normal amount.
If several bills are close at once, the catch-up can get uncomfortable. Pick the ones with a hard due date first (rego, insurance) and let the softer ones (Christmas, birthdays) run a bit lean this year.
One account or lots of little ones?
Either works. What matters is that the money is not sitting in your everyday account where it looks like spending money.
- One sinking fund account, tracked on paper or in a sheet. Simple to set up. You just need a list showing how much of the balance belongs to each bill.
- Several accounts or bank 'buckets', one per bill. Easy to see at a glance. More fiddly if you have eight of them.
- Inside an offset account, if you have a home loan with one. The money still reduces interest while it waits. See the offset buckets article for how that works.
Moneysmart suggests having separate accounts for bills and savings to make budgeting easier. Set up an automatic transfer for the day after payday so you don't have to remember.
When the bill arrives
- Check the pot has enough. If it's a bit short, top up from this fortnight's spending money rather than the emergency fund.
- Pay the bill from the sinking fund, not from your everyday account.
- Write the new amount down. If insurance went up $120, add about $4.62 a fortnight ($120 divided by 26) for next year.
- Keep the transfer going. The pot starts filling for next year straight away.
Key numbers
| What | Figure and source |
|---|---|
| NSW short-term rego terms | 3, 6 or 12 months NSW Government |
| Victorian shorter rego terms | Three or six monthly via myVicRoads VicRoads |
| Moneysmart suggests separate accounts for budgeting | Separate bills and savings accounts Moneysmart |
| Moneysmart budget planner frequencies | Weekly, fortnightly, monthly, quarterly or annually Moneysmart |
Free official help
- Moneysmart budget planner
Free tool that lets you enter bills weekly, fortnightly, monthly, quarterly or yearly. - Moneysmart savings goals calculator
Works out how long it takes to reach a target, handy for a catch-up. - Moneysmart: How to do a budget
Covers irregular costs like annual bills and car repairs. - NSW short-term vehicle registration
NSW options to register for 3, 6 or 12 months, depending on the vehicle. - VicRoads: Renew your registration
Victorian rego renewal, including the three or six monthly option.
Questions people ask
Should I divide by 24 or 26 if I'm paid fortnightly?
Divide by 26. There are 26 fortnightly paydays in most years, so dividing by 24 puts aside more than the bill costs.
Can I just use my emergency fund for rego?
You can, but then the emergency fund is empty when a real surprise hits. Keeping rego in its own pot means the emergency fund stays for things you couldn't plan for.
What if a bill goes up when it renews?
Top up the gap from that fortnight's spending if you can, then work out the new per-pay amount by dividing the new yearly cost by 26.
Is paying rego every six months a good idea?
It can make each bill smaller, and NSW and Victoria both offer shorter terms. Check the total cost over a year, because shorter terms or instalments can cost more.
Get the free pay check sheet
Type in one fortnight's pay and bills and see where it all goes. Works in Excel and Google Sheets.
Keep reading
Sources
- Budget planner, Moneysmart. https://moneysmart.gov.au/budgeting/budget-planner, accessed 2026-10-16.
- Savings goals calculator, Moneysmart. https://moneysmart.gov.au/saving/savings-goals-calculator, accessed 2026-10-16.
- How to do a budget, Moneysmart. https://moneysmart.gov.au/budgeting/how-to-do-a-budget, accessed 2026-10-16.
- Short-term vehicle registration, NSW Government. https://www.nsw.gov.au/driving-boating-and-transport/vehicle-registration/renewing-vehicle-registration/short-term-vehicle-registration, accessed 2026-10-16.
- Renew your registration, VicRoads. https://www.vicroads.vic.gov.au/registration/renew-update-or-cancel/pay-your-registration/renew-your-registration, accessed 2026-10-16.