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Household Budgeting Basics
The new year is the ideal time to review and revamp your household spending plan or to create one if you don't yet have it.
It may seem like a drudge chore, but I can guarantee you'll get excited when you see your spending for the year all laid out in front of you. You'll feel satisfied knowing where your money will be going. You'll be challenged to trim some of those expenses you didn't realise were quite so high. You'll grin from ear to ear when you see how much you'll be able to save this year just by having a written, detailed spending plan.
Creating a household spending plan will help you to stay on track and make sure you have enough money each month to pay your bills, build some savings and have money for anything extra that may come up.
Here are some household budgeting basics to help you get started.
Use the computer to create a spreadsheet that will hold all of your information (use Excell to create our basic spending plan, but I also back it up with a paper copy in an old fashioned ledger book I bought from the newsagent years ago).
You’ll need to include your income, your monthly expenses, yearly expenses and room for anything else that may come up. These would include vehicle repairs, school costs, going out to the movies, and other things along those lines.
1. Income
The first thing on your spreadsheet would be your income. You’ll want to include everything you may have such as pay, secondary income, child support, Centrelink payments, bonuses and other forms that may only come once a year like tax refunds or gifts.
2. Monthly Expenses
Monthly expenses are the next thing to add to your spreadsheet. These would include mortgage/rent, credit card payments, utility payments, loan payments and anything else that comes up every month. You’ll want to have monthly amounts and due dates so you can place these under your income where it comes in each month.
3. Yearly Expenses
Yearly expenses may be a bit of a challenge to include, but it’s a good idea to do it. This will help you avoid the stress of coming up with the money when they come due each year. This will mean you’ll need to create a spreadsheet for each month for the entire year so you can include these types of expenses. They could be car insurance, registration, council rates, membership fees etc.
4. Extras
Extras are hard to budget for which is why you should try to plan on them each month. Putting money into an emergency savings account will help you to have the money when the time comes. It’s nearly impossible to plan for vehicle repairs or emergencies, so an emergency account will help to ease the burden when these types of things come up. You can plan on maintenance to your vehicle or yearly check-ups with your doctor, but there are times when even these things don’t help, so planning ahead will help.
5. Holidays
Planning a holiday is hard to do but when you do your budget right you’ll be able to include this in your month to month budget. Your savings account will help with this plan as well. You’ll be able to see where you have a little extra money and you’ll have the ability to stick some money back so you can take a holiday when you’re ready to take one.
These are just broad suggestions, you can create a much more detailed spending plan once you've made up a basic one, and then you'll really know exactly where your money is going and how much you can put to a Payment Push or Emergency Fund or regular savings.
Creating a household spending plan will help you to spend your money wisely and you won’t forget a thing. It’s nearly impossible to remember everything you need to pay each month so creating a spreadsheet with all of your expenses and extra things you want will help you to maintain your budget so you can make everything happen easily.
You’ll have the ability to see the big picture which will help you to see what you can do to increase your income and lower your expenses so you have more money in your bank account at the end of the month.
It may seem like a drudge chore, but I can guarantee you'll get excited when you see your spending for the year all laid out in front of you. You'll feel satisfied knowing where your money will be going. You'll be challenged to trim some of those expenses you didn't realise were quite so high. You'll grin from ear to ear when you see how much you'll be able to save this year just by having a written, detailed spending plan.
Creating a household spending plan will help you to stay on track and make sure you have enough money each month to pay your bills, build some savings and have money for anything extra that may come up.
Here are some household budgeting basics to help you get started.
Use the computer to create a spreadsheet that will hold all of your information (use Excell to create our basic spending plan, but I also back it up with a paper copy in an old fashioned ledger book I bought from the newsagent years ago).
You’ll need to include your income, your monthly expenses, yearly expenses and room for anything else that may come up. These would include vehicle repairs, school costs, going out to the movies, and other things along those lines.
1. Income
The first thing on your spreadsheet would be your income. You’ll want to include everything you may have such as pay, secondary income, child support, Centrelink payments, bonuses and other forms that may only come once a year like tax refunds or gifts.
2. Monthly Expenses
Monthly expenses are the next thing to add to your spreadsheet. These would include mortgage/rent, credit card payments, utility payments, loan payments and anything else that comes up every month. You’ll want to have monthly amounts and due dates so you can place these under your income where it comes in each month.
3. Yearly Expenses
Yearly expenses may be a bit of a challenge to include, but it’s a good idea to do it. This will help you avoid the stress of coming up with the money when they come due each year. This will mean you’ll need to create a spreadsheet for each month for the entire year so you can include these types of expenses. They could be car insurance, registration, council rates, membership fees etc.
4. Extras
Extras are hard to budget for which is why you should try to plan on them each month. Putting money into an emergency savings account will help you to have the money when the time comes. It’s nearly impossible to plan for vehicle repairs or emergencies, so an emergency account will help to ease the burden when these types of things come up. You can plan on maintenance to your vehicle or yearly check-ups with your doctor, but there are times when even these things don’t help, so planning ahead will help.
5. Holidays
Planning a holiday is hard to do but when you do your budget right you’ll be able to include this in your month to month budget. Your savings account will help with this plan as well. You’ll be able to see where you have a little extra money and you’ll have the ability to stick some money back so you can take a holiday when you’re ready to take one.
These are just broad suggestions, you can create a much more detailed spending plan once you've made up a basic one, and then you'll really know exactly where your money is going and how much you can put to a Payment Push or Emergency Fund or regular savings.
Creating a household spending plan will help you to spend your money wisely and you won’t forget a thing. It’s nearly impossible to remember everything you need to pay each month so creating a spreadsheet with all of your expenses and extra things you want will help you to maintain your budget so you can make everything happen easily.
You’ll have the ability to see the big picture which will help you to see what you can do to increase your income and lower your expenses so you have more money in your bank account at the end of the month.