What's the next step for budgeting?

Jo_R_2

How do you decide what the next step is?

Have been moneysaving for a few months now, and am really into it. We have a budget worked out for petrol, bus fares and going really OS on the shopping with meal planning so happy with that so far.

Been researching better deals on a variety of DDs, and have saved money on our broadband and phone line rental, plus about to change our contact lens providers to save some more £££s.

What I think I would like to do now is work on our monthly budget some more. Despite having the aforementioned things budgeted for, there are still areas we haven't accounted for and I do find that on occasion they can impact onto our shopping bill. For example, last month we had a few new baby items to buy which because we had no money elsewhere came out of our shopping bill where they wouldn't otherwise have.

Can people give me examples of how they save for what for each month if that makes sense? What I mean really is irregular expenses but those that you know you will be paying out for at some point, eg car tax (can I do this with stamps?), MOT, birthdays and special occasions, Christmas (started saving up stamps), and a clothing/shoe allowance, for example. Also we want to introduce the idea of "pocket money" for each of us. I assume the best way to do this is to work out over the year what you might expect to pay and transfer the appropriate amounts out of yr account when you are paid to a separate account? Not sure how I would work out amounts for birthdays etc and for clothing. Have been utilising spreadsheets and having a bit of a play around with figures.

I suppose what I am hoping for eventually is a pretty strict budget which accounts for every possibility which can be tweaked if necessary. I know this is going to be hard at first because I am off on maternity leave with reduced pay until January so am dealing with less money than usual anyway. The ultimate goal is to be able to pay off our unsecured loan as quickly as possible by throwing spare cash at it, then save for a deposit on a house so knowing what we're working towards really helps me to feel focused.

Thanks guys!

Littlemiss-lotsofdebt

Not sure if this helps, but I worked out the running costs of my car - insurance, MOT, tax and maintenance and have a standing order from my current account of £15.00 per week to cover this. I also decided on a value for birthday and xmas presents, divided it by 12 and now save £25.00 per week by standing order for this. This prevents me panicking at the time and overspending but provides enough leeway to transfer funds into my current account in an emergency (all 3accounts with same bank).

I allow myself £50.00 per month for things like magazines, wine etc and things like hairdressing is covered by cheap model nights or money given to me at birthdays/xmas. At the moment I haven't got a clothes budget as I have a wardrobe full I could fit into if I stayed off the wine!!!

Ali-OK

Hi

I went through my calendar and then spreadsheeted costs for each month that weren't everyday ones. Helped because I have big notes on each month for stuff like MOT, annual insurances (house/car), car service, car tax, opticians + lenses (annually), dentist (6 monthly), all birthdays, Xmas, DS's birthday/party, school hols childcare (as it has to be booked and paid @ 4 months before going), etc.

Then I added up the 12 months costs, divided by 12 and now save that amount per month. It's scary, as mine came out at £3K per year, so I am putting away £250 a month, but at least it's now catered for. Add on forseeable future items that are one offs (I had to add hotel accommodation for a wedding recently).

Could you go back over bank statements and/or cc bills for the past year and look for those type of things? I've built my spreadsheet up over time and have found that Jan and Feb are my only months without additional expenditure!

Imelda

Hi Jo_R,

I have been doing the same thing over the last 3 months and I am still finding things I haven't accounted for cropping up! I have a savings account which I put £180 per month into for, car expenses, Christmas, annual maintenance bill, travel insurance, dentist, birthdays. I have a separate account for bills so that I know they are covered each month, another savings account to save up to pay off my credit card bill and a "me" current account for all socialising and clothes. I also keep a spreadsheet so I know exactly how much money I have, what bills need to be paid and also my spending diary to stop me overspending/ to see where I need to cut back. I have great sympathy for you, I only have to look after myself, god knows how I would manage with a family.

Jo_R_2

Imelda - dentist another to think about, thanks! Looks like I'll have to sit down and go through everything, and I know it will be tight for rest of the year so may have to put off the pocket money and clothing allowances, but it makes sense to be putting this money aside.

What sort of account can I pay this money into - just open a basic account to transfer the funds into?

Imelda

Hi Jo_R,

It depends what access you need, I set up an internet savings account with my bank (first direct) so I can transfer the money and have access the same day in case of emergencies. Not the best interest rate (as it does build up into a tidy sum, most bills due 31st December) but gives me piece of mind knowing I can get at it straight away. Also, make a note (or spreadsheet) of how much you are putting aside for each thing as it would be easy to see the cash in the bank and overspend.

taplady

Hi! you can buy savings stamps for things like car tax at the post office. I save stamps for Morrisons, getting a couple whenever I go which is about once a fortnight.They soon add up.I also save for christmas vouchers so that I know we're covered for christmas. these start in January and finish in October, I always have about £300 worth and also pay for £200 for my mum who then in exchange pays for my dancing lessons and £100 worth of Tesco savings stamps.
We allow ourselves a set amount of pocket money each week and this also has to cover for buying our clothes.
I set a monthly budget for things like kids pocket money, hairdressers, petrol, mobile phone topups,dogfood,groceries. We havent yet included birthdays and kids clothes in our budget so we need to tackle this soon.At the moment this comes out of any spare money in the bank.I put £50 into a car account and £50 into a contingency fund each month for emergencies such as washingmachine repairs and things that crop up which aren't in the budget.

gerretl

Hi
Further to what Imelda said, I have some accounts with ING. The great thing is, you can name your accounts, and they actively encourage you to open as many as you want. The interest rate is pretty good (Although they are not above snekily lowering it every now and then).
Meant I was worried about paying for a holiday, until I realised I had the money there all the time.

Jo_R_2

It seems so obvious now to budget over the year and to put money aside - I can't believe that before finding this site I had NEVER thought about it EVER!

We have been thinking about Christmas and have already started saving stamps and on a card at Morrisons and Asda as last Christmas we didn't think ahead, I had my usual vague thought around July time then did nothing about it whatsoever

Like I say we don't have a lot of spare cash so it's going to be difficult over the next six months but want to put in good plans and habits for when I go back to work, and why not start now?

MrsTinks

well as of next month I am going to start putting at least £50 away in an account for emergencies etc. Yes I could over pay this on my loan but it gives me hope to have a cash lump sum available straight away if I need it. Silly? maybe... but I like the idea of knowing that have budgeted for that and it won't affect my overdraft or credit cards Psycological I guess

Sea78

Hi,

I also do the ING accounts...have separate pots for car tax (£12 a month), car maintenance (£50 a month - things seem to be bloody expensive!), car insurance (£50 a month, hopefully this will reduce), gas (£20 a month), elec (£20 a month), clothes (nothing at the mo!!), Christmas (£20 a month), birthdays (about£5 at the mo).

I'm hoping this will make it easier, but am panicing at sight of current account balance...

The ING direct ones are good as it's easy to use, and separate from any other banks...

Sea xx