How to set aside tax money each month
The easiest way to avoid deadline panic is to save tax money every month, not at the end of the year.
Start with an estimate, then transfer a fixed percentage of net income into a separate account after each payment you receive. This keeps tax funds ringfenced and prevents accidental overspending.
Review the reserve monthly. If income rises quickly, increase your transfer amount early. If income falls, adjust carefully so you stay realistic without underfunding your next payment.
A small monthly routine is more effective than occasional large corrections. Predictable habits improve cashflow confidence and reduce financial stress.
Key points
- Create a dedicated tax savings account.
- Automate transfers where possible.
- Review your set-aside target each quarter.