The How-to Guide to Budgeting
Budgeting is no easy task to start with, but like most things in life, once you get into the swing of things, it can be as second nature as breathing, well sort of.
The important thing to remember with budgets is that they have to be stuck to, else what is the point? Stealing from Peter to pay Paul will only work for so long, before Peter and Paul meet up and all hell breaks loose. This is the time you realise that you need a plan. Your saviour is of course the budget.
So, how do you do it?
Sit down and work it all out
The first port of call here should be to grab a coffee, find a comfortable spot, some paper, a pen an a calculator, and get stuck in. Work out what your solid monthly income is, without relying on overtime and other things that may or may not come to fruition. Once you’ve done that, add up all your outgoings, such as rent, petrol, electric, gas, food etc.
Take a break for a few minutes
I say have a breather at this point because the next bit might be a tad painful. From the number you worked out as your incomings, takeaway your outgoings. Now it’s important to be realistic here. For example, don’t try and kid yourself that you spend less on food per month, because you’re only going to end up going overbudget. Once you have done that painful subtraction, you will be left with the amount you have left to play with.
Work out your extras
There’s no point in budgeting all your money away to the point where you have nothing left to enjoy yourself with. Budgeting for a social life is just as important, so work out how much you can realistically afford per week for social activities. Take that away from the number you had left. Give yourself a clothing allowance too, a sundries allowance, such as magazines etc, although do bear in mind that this is the part of the whole shebang where you could cut out on those extras that waste money, and you don’t really need!
Take your allowance out of the bank weekly
If you have your entire month’s allowance in your purse, you’re going to dib into next week’s money and you’ll be skint by the end of the month. If you take it out per week, and make it last, you’ll be in a better position. Don’t take your bank card out with you, and under no circumstances dib into next week’s money without a huge emergency!
At first, budgeting is hard, and you will feel like you want to splurge, but it’s important to rein yourself in and remind yourself that once you’re in control of your finances, you will be much more in control of your life as a whole, feeling much better as a result.