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Whether recent months have left you financially flush or strapped for cash, now is the perfect time to flex your budgeting muscles. Creating a budget for the first time - or updating one you already have – isn’t something many of us enjoy. Here are some tips to help you decide what’s in and what’s out – for the time being anyway.
1. Think of your budget as temporary.
None of us know when life will get back to ‘normal’ – or even what that normal will look like. So, don’t worry about that now. Use this time to create a budget that makes the most of any savings from spending more time indoors. Having a temporary mindset will make it easier to say goodbye to the things you don’t need right now, such as new clothes or your regular takeaway. The money you save could go a long way.
2. Give your expenses a spring clean.
Have you noticed a shift in your spending patterns? Which expenses have gone up and which have gone down? Now is a great time to put your expenses under the microscope. Ask yourself if you or your family really need every item in your budget. What’s the underlying reason for having that expense – is it just a habit or is it something you genuinely need or enjoy? Adjust your budget to reflect your reality today.
3. Shine a spotlight on your memberships and subscriptions.
If, like many of us, you have a raft of online subscriptions that you haven’t used in a while, now is a great time to decide if you need them all. Monthly subscriptions such as Spotify, Netflix or Stan might not cost much on their own - but they do add up. Have you found yourself surprised by an annual subscription fee in the past? Now is a great time to double check what you’ve signed up for. Are you still using it? Is there a cheaper alternative?
4. Make a regular date with your budget.
Once you’re happy with your budget, review it each month. Things are changing constantly right now, and your circumstances will be no different. As your income and outgoings change, so should your budget. Regularly going back to your budget will also help you keep on track with what you set out to achieve. A good time to do this is at the end of each month. Once you’ve got a clear picture of your current income and expenses, you can better plan for the month ahead.
5. Reward yourself for good behaviour.
Giving up life’s luxuries isn’t something many of us enjoy, so try and find ways to make things fun. For example, you might put aside a bonus or reward for each month you stick to the budget. It could be something like getting your favourite take away or buying yourself a treat. If your budget is a family one, it could be bonus movie time or purchasing a family board game. The key to successful budgeting is finding an approach that works for you. Our handy budget planner makes it easy to break down your income and expenses to get an overall picture of your budget. You can email it to yourself, print it and update it every month.
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