For most of my life I can honestly say that I had no concept of how a budget even worked. Admittedly I was raised in quite a privileged and sheltered situation, which I am extremely grateful for. However now as a young adult trying to figure out how the hell “adulting” even really works, not knowing how to actually plan and stick to a budget can be a major problem. Another major problem is the fact that I’m a spender. To be honest I’m a sales associates dream and I tend to fling my money around and then by the end of the month am panicking that I am quite broke.
January is the month where we have so many plans and goals and aspirations and barely any money to help make them happen. Our wallets are looking a little thin after Christmas and it’s the longest we’ve gone without a pay check in a while. Therefore budgeting is absolutely essential.
Have a Place Where You Can Document EVERYTHING!
And I really do mean everything! It’s so essential having a place where you can see all of your financial income and expenditure laid out in front of you. I know some people find it really effective to use an Excel sheet for that, but personally I’m a little old fashioned. I much prefer writing things down, I feel it’s easier to understand and makes me feel a little bit better knowing that I can’t accidentally delete the whole file.
I’ve been using this gorgeous little Budget Book from BusyB Stationary and I’ve been absolutely obsessed with it! There’s all the sections you could possibly need in it, including separating Regular Income from Other Income, which I think is a great feature. There’s a page for Direct Debits & Standing Orders, Other Bills, Spend Expenditure, and Credit Card & Store Cards Spends. At the end of each month there’s a Monthly Summary with a slot for your receipts or documents you need from that month. As well as that there’s a section in December dedicated to a gift gifting.
Figure Out How Much You Have To Spend
This sounds like such an obvious step and yet it’s one people miss all the time and end up struggling with. It’s imperative that you figure out how much disposable income you have to spend that month. Do this by first writing down how much money you’re getting every month, and then deduct all the absolute essentials. These would be bills, rent, food, toiletries and other things you absolutely need. After that, you’re left with what’s called disposable income.
From here, I like to deduct a further set amount from my disposable income and put it into savings. I’m someone who really believes that you have to have some savings “just incase”. I like to call it “oh shit” money, you know, just in case something drastic happens that I need some money there for. You can also have savings towards holidays, a mortgage, a deposit on a bigger apartment, whatever you want to save for. But don’t discount this step! Living pay check to pay check can get exhausting and stressful.
Stop Impulse Spends!
If you’re a little bit like me, you’re all too familiar with impulse purchasing. I always find myself buying things without really thinking it through just because I’m caught up in the moment. Something I’ve found helps is writing the number of your disposable income that month onto a little piece of paper and stick it into your purse. Every time you want to impulse buy, take it out and have a look at the number. Ask yourself “is this worth dipping into my money for?” If you’re a little bit unsure, it’s best to leave it and sleep on it. If a week later you’re still thinking and lusting over it, go back and buy it!
Honourable Mention: Stay Organised!
There’s nothing that’s going to keep you on track with your finances more than organisation. BusyB kindly sent me over their Password Book too, which has proved an absolute essential to my organisation. It’s small enough to hide in a desk drawer and has pages upon pages of places to store your password, username and website name. I use this for all my financial websites as well as for blogging with social media etc. It’s one of my favourite things ever!
How do you guys stay on top of your finances? Do you use a budget book? Let me know in the comments!
*These products were sent to me complimentary with expectation of an honest review.