sticking to a budget - advice / tips

krainuk

Hello im new to this site and wondered how people manage to stick to a budget? i know loads of people probably ask this but i really need help to sticking to a budget. any tips or advice would be really helpful


my background
iv done countless plans but can never stick to them something always seems to come up (nights out, car breakdowns, birthdays etc). i really want to pay off my debt and save for a house deposit.

I have a £700 old overdraft which has been sold to BCW group and a credit card with capital one £950 debt (credit limit is £1000).

I have two credit unions where i have had loans. both are almost paid off give or take a couple hundred pounds. (these eat into my monthly outgoings)

i was hoping to get a 0% credit card to transfer the balance to save some money on interest from the CC unfortunately i can only get accepted for one card and i am already with capital one so i cant do that.

my monthly outgoings are high to cover bills rent etc so i try to pay what i have left of my monthly wage approx £250-300 depending on the month off my credit card but then it either disappears ( no big purchases just £10ers here and there )or i then respend on the credit card so nothing actually gets paid off (if that makes sense) so it never seems to go down.

i'm terrible at money management and i really am trying to improve my knowledge and finances.

i recently paid off another credit card so thats gone, my car loan has finished, i paid off some college fees so i do think i have come a long way.

my partner now works full time so its not a case of paying household bills on the credit card now (as it was when we first moved over a year ago) its just a case of money management i think now - which is the scary part as it is so easy to fall back into debt.


i know its a long post but any help or advice would be appreciated

Sazzie23

Hi Krain

I'm a rubbish budgeter, but my LBM last year was discovering that budgeting isn't about what I spend, but it's really about what I don't spend!

With that in mind I'm sure someone here will help out a bit, and well done for doing your best.

tlc678910

Hi Krain,
I recommend you give YNAB (you need a budget) software a try. You can download a free months trial from their website.

You plan your budget when you get some money (get paid etc) putting this into your pots or "categories" (only on the budget the actual money still sits in your own bank) so you might put money into groceries, petrol and council tax etc. then if you want a night out you have to see if you have money in your "leisure" budget or if you decide to "steal" it from other categories. It focuses you mind on your actual priorities and what you can afford. E.g. If you always want a holiday but you can never afford one you will become aware if you are stealing from the holiday fund for nights out each month!

If you try it I recommend watching the tutorials and reading up so you know how to work it. I love using the program now and I don't know how I kept track of my outgoings before. I probably didn't I suppose that's why so many expenses are on the credit card!

tlc

FireWyrm

I'm another YNAB fan. The only way to budget it to stick to it. There is no magic bullet, no short cut or trick. If you dont have the money, you cannot spend it. It is that simple.

Budgeting is about anticipating risk more than anything else. What is the risk that you will need to buy at least one birthday present within the next year? I'd say it is a racing certainty, so you need to budget for it. What is the risk that the roof will blow off next winter....pretty slim, but still a possibility. Perhaps a slower savings path might be the better option for that eventuality. If you have children, they will need shoes and clothes. Even adults who generally dont wear out their clothing quite as often will typically need to replace at least one item a year. This is what budgeting means.

You cannot formulate a sensible plan (budget) unless you know exactly what the shape of the problem is. Your post is somewhat vague regarding actual amounts of debt and you have not included anything detailing common outgoings and bills. You need to sit down and write this information down and use it. Once you have that, formulate the plan that you feel comfortable with - AND THEN STICK TO IT. It's like dieting - you cant lose weight if you continue to stuff your face with cream cakes.

You need to have a good long talk with yourself and perhaps slap yourself around the face a few times. When you think you have a plan, come back and post it here as an SOA and we can then offer some more detailed and tailored advice.

rockm87

your budget does need to be realistic, otherwise you end up with no money left and things to pay for, so you use your card.

Initially get a statement of affairs together, and realistically look at what you already spend.

concrete_kid

I use a google docs spreadsheet ( I just googled budget template). But I think the first thing to do is keep track of your spending for one month, this needs to be every penny. During this month don't attempt to save / budget in order to give a reaslitic idea of what you spend.

I did this then I used these figures to create my budget, it was much easier once I knew exactly what I spent. It took a few months to get used to but eventually you begin to get into the habit, and then i started reducing the amount I spent on things so it wasn't such a shock.

The important thing for me was realising that just because I had one figure in there at the start of the month didn't mean it couldn't change. As mentioned above, if something came up I'd 'steal' money from other catogaries in order to balance it.

It's also good to get in the habit of thinking ahead in terms of what's coming up in the next month / few months. So make sure you plan for birthdays, dentist, etc.

Another breakthrough for my budget was a 'Misc' categorary, for things that come up that can't be planned for, or times when you want to be spontaneous such as a few drinks with friends. Mine is 10% of my monthly take home pay which is about right for me and has worked well.

Good luck.

Dobbibill

Hi Krainuk,

Welcome to the forum.

Alot of good advice in the previous posts.

There is no magic remedy but there is a few things that may help you on your way.

Many people are fans of the YNAB app and use it daily to track their spending and keep on top of their budget. I don't use this personally so a few other ideas to give you a choice and to find what works for you best.

I can point you in the direction of some really good spreadsheets here.

Also if you want to do a SOA. You don't have to post it but I think doing one certainly gives an idea of overall spending, so here is the link for that too. If you do want to post it then I'm sure there will be several knowledgeable people along soon to offer further advice and support.

You really need to account for every penny that comes in, there will be things that crop up from time to time so get some savings to budget for them. There will be birthdays so budget for them, Christmas will be in December so budget for it. It's just about making sure when something arises that you don't need to go back to CC's to fund it otherwise the vicious circle will continue.

i recently paid off another credit card so thats gone, my car loan has finished, i paid off some college fees so i do think i have come a long way.

Well done on clearing these. This shows you that you can do it so something has worked for you previously, you need to find what that was and make it work for the budget.

All the best, I hope you find the best tool to support your challenge.

DB

krainuk

Hi everyone thanks for the advice I think I will give this YNAB thing a go and track what I actually spend my money on and work it out from there.

I always have good intentions but it's been hard to stick to the plan in the past but your right it's something I need to just get on with a do it ��

HappyMJ

Birthdays don't just come up...they can be planned for. Nights out should also be planned for. If you regularly go out for a night out let's say once every 2 weeks then limit yourself to that and no more. Car repairs can also be budgeted for you need a pot of money which you contribute let's say £100 per month towards and these annual expenses can come out of this pot rather than using a credit card/overdraft.

in_need_of_direction

My own approach is to list all bills and things to be paid for each month in a hard back notebook. I then withdraw a set amount of cash each week to live on. I find dealing in cash makes money more real to me.

Bobarella

I think you would really benefit from keeping a spending diary in a format that works for you for a long period. Say 3 months. Literally write down every expense. Then work out at the end of each month what the pattern points to and how you feel about it.
£20 for example is a huge amount when saved well over a long period into a pension or taken off a mortgage interest total. If you know you are regularly spending 'just a tenner' here and there it may help you to see how all those tenners spent on a coffee or tobacco or whatever tally up.

Some tips. I have managed to increase our monthly cash ISA savings amount to £180 since november, from £50 simply by every time I find a good saving in my budget immediately ringing the bank and upping my direct debit to that amount. We got rid of our car so immediately I was able to put petrol savings to that account. Recently I made savings on my water bill, grocery bill & home contents insurance all of which has totalled to £180 very quickly. So its all going to my emergency fund till I hit £1000 then I will wack it onto overpaying my debt ASAP.

You can do it but you have to want to stick to a budget and believe you can be debt free.