Budget Basics

basic budgetsWhether I’m at work or chatting with friends, I always hear the same complaint when cash is mentioned, “I just don’t know where my money goes!” There was a time I had exactly the same thought but there is an easy solution to track your outgoings.

*obvious suggestion alert* Drawing up a simple budget is the first step in understanding where that hard earned cash floats off to each month. It doesn’t need to be a whopping great spreadsheet filled with formulas and funny symbols, you could just get a pen and paper and jot down exactly how much comes in and what NEEDS to go out.

Be honest when creating your budget, add in all of those niggly expenses like a coffee at the train station, a pack of gum or money for the office lottery syndicate. It all quickly adds up!

Our budget is fairly basic (even if it is now colour coded *hides head in shame/glee*) and ensures we can track of where each pound goes. Here is a handy website that has 10 free budget templates you can download and get filling in, ranging from ‘Super Basic’ to ‘Family Planning’ worksheet. Check out www.savvyspreadsheets.com for loads more hints and tips.

super basic budget

Take a moment to take it all in……

Now that you can see exactly the costs you are dealing with right in front of you, set the time aside to move heaven and earth to reduce these where possible. The biggies tend to be:

  •  Mortgage- Can you shop around for a cheaper deal but avoid exit fees/penalties?
  • Energy – Use comparison sits such as USwitch to see if you can grab savings on your current tariff by switching to a different supplier. Remember to watch out for exit fees here too)
  • Water – Take steps to use less each month by installing handy gadgets, get a water butt in the garden to collect rain water and opt for a quick shower rather than baths
  • Food – This often accounts for a hefty slice of money. See my ‘Savvy Shopping‘ tab on the front page and subscribe to this blog to keep up to date with tips to reduce costs.
  • Debts – If your debt is on credit cards, see if you can shop around to transfer it to a 0% deal. Even if you have a poor credit rating, there are some good offers around.

Don’t beat yourself up if you go over budget in certain departments  just see if you can pull the cash from another area for that month without leaving you short or in debt. Budgets can be, dare I say it, fun. They can also be inspiring to get you to where you want to be financially or even reveal extra cash you didn’t think you had! Bonus.

Remember to allow yourself some ‘spending money’ to keep you motivated, especially if you are paying off debts. Having a small amount to spend on yourself each month can be the difference between staying on track or jacking it all in!

Do you have a budget? Do you always stick to it?

4 Comments

  1. Thanks for the templates SavvyAnnie – I’ve been meaning to start one of these for years. I tried it earlier this month when you posted it and I’e already made savings. You don’t realise where the money is going until it is there in black and white!

  2. Nice post SavvyAnnie and thanks for the templates.

    I have found that adding a new category in the budget for specific things you want to buy/spend can really help you avoid unnecessary purchases.

    For example, instead of just putting a new phone on a credit card, I introduce a line for “new version of phone” and spending three months saving for it on the budget spreadsheet (even if you could theoretically afford it today).

    This really helps me question whether I actually NEED the new purchase or if it is a short-term desire.

  3. Thanks for your comment. I totally agree that customising the budgets to suit your spending needs is the way forward.

  4. Life is expensive, that’s true. But it can be less expensive, if we carefully plan our budgets and stick to them. When I first started jotting down expenses and calculating them at the end of each month, I was surprised at how thrifty I’ve become! I started cooking pancakes at home rather than buying them in the local park. I noticed that I drink free coffee at work instead of purchasing it on the way to office. These small things save me tons of cash!

    May be I’m old-fashioned, but I prefer to keep track of daily expenses in my personal notebook (rather than using automated tools available online). However, many of my friends are fond of digital templates, so I’ll pass the link to your article on! Thanks for a great post!

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