Budget Help

ellemarie · 22 May 2018 at 1:58PM

Hello all,

My partner and I have accrued just short of 22k of debt, which I can only blame on mental health (avoiding it all until it's just short of consuming me alive), living beyond means, rubbish wages and unfortunate, unavoidable circumstances!

I realised that we were in a spiral of borrowing to consolidate, then borrowing more - most of our income was spent paying off debts and in general we are not managing our money very well.

So I put a plan in to action of moving all our incomings and outgoings in to a joint account so everything was far more visible to both of us, rather transferring backwards and forwards to cover short falls.

I have a budget spreadsheets which lists all static outgoings but struggling to actively create a budget as we have a couple of outgoings that we cannot really estimate, for example, we have a payment meter for gas and cannot really estimate how much we will spend monthly on this, same with diesel for the car and food shopping. Can anyone suggest any ideas to help with this?

TIA!

Indout96 · 22 May 2018 at 2:35PM

The only way you can estimate your monthly usage is by looking at previous bills and then using that as an estimate.
But I am guessing you paid these in cash so not as easy to work out.
All you can do is keep a record of the spending this month and then use that. The more months info you have the more accurate your figure will be as it will average out the rise and falls.
For example if you fill up the car in week 1 and fuel lasts 3 weeks then you will fill up twice in month 1 & 2 but only once in month 3 so if it costs £80 each time them month 1 & 2 will be £160 but month 3 will be £80 so average £133
Same with Gas / Electric - you will tend to use more in Winter than Summer so allow for that when counting what you use in the next few months or you will be short in Winter

enthusiasticsaver · 22 May 2018 at 3:02PM

Look back on previous bank statements and start a spending diary or use a spending app tracker on your phone. Can you change from a meter to direct debit as meter paid energy is much more expensive. Easier to budget using monthly direct debits too.

National_Debtline · 22 May 2018 at 4:28PM

Hi ellemarie

Some good tips and observations above. It can take time to build up a really accurate idea of your budget so getting started on a spending diary - whether through a suitable app or good old pen and paper, whatever works for you - is the key. Until then it's probably wise to add a few £ on top of any educated guesses you make for thins like energy, groceries etc. as a lot of us tend to let wishful thinking affect our estimates i.e. we like to think we spend less on XYZ than we do in reality.

https://www.nationaldebtline.org/EW/factsheets/Pages/budgetingandsaving/budgetingadvice.aspx

Dennis
@natdebtline

EssexHebridean · 23 May 2018 at 3:49PM

With a prepayment meter you might think about setting yourselves up a savings account specifically for money to use for this. Then work out roughly what you spend per year (if you can - if not estimate by noting everything you put in for a month, and then bearing in mind the time of year at least double that for six months of the year, to cover the extra during winter) Average over 12 months (so for example £30 a month for April > September and £75 per month for October > March = £630 = £52.50 per month). Then set aside that monthly amount into your savings account each month, withdrawing ONLY what you need to feed the meter with - that way extra will accrue towards the winter months. Any excess you have in there at the end of next winter could be paid off debt or moved to more long-term savings.

Groceries, to give you an idea there are two of us in my household - we spend well under £200 per month on groceries - that includes meat mostly from farmers markets or direct from suppliers, free range eggs, and everything cooked from scratch. Also some oddments of toiletries and cleaning stuff included in that figure. We've probably got it a bit more nailed down that some, but again, it gives you a clue.

Budget Help

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