Budgeting for Freedom – Top 10 tips to balance your budget!
Here we are, heading towards Summer, and the festivities of New Year and Easter seem like just a distant memory. With one exception: money!!
Many of us feel like we are in the position of always running to catch up with our finances. Each month we struggle to make ends meet and it is a relief to get to payday – although the money then seems to disappear as soon as it’s there! So it is not surprising that when seasonal expenses arise, such as Christmas, it has a real knock on effect on our finances for months to come.
The only way to break this cycle is to make a budget and stick to it. At this point many of us will groan and start to switch off, but if you are serious about getting in control of your finances this year, it has to be done.
Follow our Ten Top Tips below to see how easy budgeting can be. You will not regret it!
- OUTGOINGS: Start by making a list of everything you spend each month. Literally everything! To do this properly you should keep a log of your day to day spending for at least a couple of weeks to help you see exactly where the money is going. It’s surprising how relatively small amounts of money spent regularly can mount up to a significant amount each month. Also list all your household expenses including rent or mortgage and all your bills. For each one ask yourself whether it is really essential: if not then be ruthless and cancel it! Many of us are paying for things we no longer need so it is important to keep reviewing this on a regular basis as your needs will change year by year.
- BILLS: Once you are clear which bills you do need to keep paying then start shopping around to get a better deal. You may well find that you can save money by switching energy suppliers or insurance companies or phone networks. Or sometimes your existing company may be prepared to put you on a better value tariff rather than lose you as a customer. If you have credit cards then see if any of them could offer you an interest free balance transfer if you moved your other credit card balances onto one. This could reduce your monthly repayments and enable you to pay the combined balance off more quickly. It’s a good idea to set up monthly direct debit payments for all your regular bills so that the money is taken directly from your bank account. You can then budget for the rest of the month knowing that all your bills are paid.
- CONSOLIDATE: Similar to the credit card balance transfer idea above, if you have existing debts and loans then it sometimes makes sense to take out one new loan to repay them all. You can then arrange to pay off this new loan over a period of time that makes the monthly payments affordable for you. How much better to have one manageable monthly payment for your debts than be juggling money around all over the place! Many lenders offer quick loans which means that you will soon be well on the way to transforming your finances.
- WHAT’S LEFT? Once all the above bills and repayments are accounted for, you will know how much money you have left to get through the month. At this stage it can be very helpful to start using cash for day to day expenditure. Work out how much you have to spend per week and take it out in cash. It then brings it home just what you can and cannot afford to buy. It can be much more effective than putting everything on a card when it is easy to lose track and overspend.
- SOCIALLY SAVVY: In the midst of all this don’t feel you have to abandon your social life! It certainly be expensive if you’re not careful, but simply by tweaking what you do, you can continue to enjoy yourself but drastically cut down your spending. Why not make staying in the new going out! Make a deal with your friends to share the entertaining so that you can keep having fun without the large price tag. How about hosting different events such as Come Dine With Me evenings, games evenings or DVD nights? You can have a great time at a fraction of the cost.
- FOOD: If you normally do a big weekly food shop, try to streamline this as much as possible. By all means get the essentials that you know you will use, but be careful about buying fresh food – especially things like the 3 for 2 offers. It is easy to overbuy and end up throwing food away: what a waste!! If anything, buy less than you think you might need; you can often be creative and stretch food further than you thought – or can always top up at a local store if you run out.
- BRANDS: Also when shopping make sure to be open-minded about brands. Many supermarkets have their own brands which are better value than leading brands but may be just as good. Definitely worth a try! Also why not work out the time of day your local supermarket reduces its prices on food nearing its sell by date, as this can also save you pounds.
- DISCOUNTS: Don’t forget to look for the many discounts, vouchers and special offers that are around for food or household goods or entertainment. There are so many voucher websites available – and special offers in newspapers and magazines – that you may well be able to get the things you need more cheaply if you take the time to do a bit of research first.
- OLD IS THE NEW, NEW: Forget the word new! You may be interested to read about a movement called The Compact – a group of San Franciscans who made a compact to buy nothing new for an entire year. Although this now dates back 10 years, many people have since followed its two basic principles which are:
– not to buy new products of any kind (excepting basics like toiletries and underwear)
– To borrow, barter or buy used
There are so many ways of obtaining items that are as good as new. Check out sites such as eBay or Gumtree to see if there are good quality second hand goods for sale, or Freecycle to get goods for free (and list some yourself to return the favour!). Another angle on this is to procure items that you then upcycle into something that suits your purposes. Let’s put the earth’s resources to good use and save money at the same time!
- SWAP-SHOP: Bringing the above principle closer to home how about setting up swap shops with friends? Most of us have lovely things we no longer want or need – but a friend may love them and give us something we love in return. This need not just apply to products but also services. You may be able to run up a set of new curtains for a friend in exchange for them cutting your hair or fixing your car. Things that may seem a big hassle to us may be very easy for a friend and vice versa – so why not start trading favours and saving pounds?!
We do hope that 2017 is the year when you finally get in control of your finances. With careful budgeting – perhaps supplemented by a quick loan – you CAN do this!! If you need to discuss your loan requirements then do get in touch to see how Loans 2 Go can help.
As Summer approaches, make it your goal to sort out your finances and start enjoying life again this year.