- 17 December 2018
- Posted by: freedomblog
- Category: Personal Finance
Using a monthly budget can help you keep track of your spending. This is useful for finding out exactly how much you’re spending on different things, and seeing where you could save money. Here are some tips for using a monthly budget. Use them to keep on top of your spending!
Work out how much money you have coming in. This should include all of your income, including your job and any money you may make on the side.
Then, plan out all the essentials you HAVE to spend each month. This should include your rent or mortgage payment, bills, your weekly shop, car payments and loan payments.
Next, budget for any extras you know you’re likely to want to spend money, such as shopping, days out and restaurant visits. Budget a realistic amount, but don’t be tempted to spend beyond your means. It can be tempting!
Are you spending more money than you have coming in? Consider cutting down in the non essential areas, for example by going on a spending ban when it comes to shopping. Even small changes, like making meals at home instead of eating out can add up.
Ensure you budget some money for your savings as well. Not only will this add up for big purchases, if you do need to go over your budget, for example for unforeseen expenses such as vet bills or household repairs, you will have some leeway.
Don’t forget anything you may have to budget for in the future! Christmas and summer holidays come to mind! Even if it’s not the season to be thinking about that just yet. Think about putting away some money each month for these if you can, so you don’t have to pay for everything up front when the time arrives.
Make sure you budget for small daily purchases such as your coffee or newspaper. While these may only be a couple of pounds a day, they soon add up! Try to work out exactly how much you spend. Are there any purchases you could cut down on to save money?
Prioritise your money! After paying your bills, what would you rather spend the money left over on? This may be shopping or saving or anything in between, but working out where your priorities lie might help you with not overspending on other things.
After using your budget for a month or two, compare it to what you actually spent. Not only will this show you where you’re going over or under budget, it can help you think about what you’re spending the most on. Then, you can work out where you could save money as well as creating a more realistic budget next time.
Using these ideas when planning can help you create a useful, realistic budget. This means you’re more likely to save money and stay on track!