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How to budget / best budgeting tips?

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  • blue.peter
    blue.peter Posts: 1,353 Forumite
    Ninth Anniversary 1,000 Posts Photogenic Name Dropper
    I find that the most useful thing for me is planning ahead. As soon as I get paid, I take all the bills that I know will fall due until I next get paid (including credit cards), and treat that money as already spent.

    Then I hold back a bit of cash in my current account to cover ad hoc spending for the same period.

    Then anything that's left over is swept into a savings account.

    Pen and paper are adequate tools for this - that's how I started doing it (about 40 years ago). These days, I find that a money management program makes the same job easier. My preference is AceMoney, but others are available. The scheduling feature allows me to look ahead and see what's coming.

    Sensible use of credit cards can help. I put pretty much all of my spending on them. This helps in two ways: Firstly, it pushes the cost forward to the next month and secondly, it allows me to include that spending in the planning when my income is paid. (Timing helps.My credit card bills are produced on around the 20th/21st of the month. I get paid at the end of the month. Then the credit card bills have to be paid - in full, of course - around the 13th - 16th of the next month. Credit card issuers are normally happy to adjust statement dates to fit your convenience.)
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