Sarah Neudorf October 5, 2020 Budget
There are always going to be unexpected bills, if your car breaks down or pet needs to be taken to the vet. These are problematic to accurately account for so it might be easier to set aside a contingency amount each month for unplanned expenses. Next step in the budget is to list all of your income. Look at recent payslips to get an accurate figure for wages and remember to include any benefits you receive, such as Child Tax Credit.
Adjust your Budget: Firstly your mortgage - you have several options here. You could increase the term of your mortgage, making your monthly payments lower. You could take a further advance and use the money to pay off your much more expensive credit cards - it is important to get rid of your most expensive debts first. Next check that you are with the cheapest suppliers for gas, electric, telephone and internet - it is not much trouble to switch and you could save a lot of money.
Go through your discretionary expenses and see if there is anything you could do without - eating out once a month instead of once a week, walking to work rather than using the car every day or taking a packed lunch instead of going to the café. If your budget calculator shows that you do not appear to be able to live within your budget, do not despair - there are steps you can take.
But of course, it can be difficult to imagine all these potential savings every month without seeing an actual final figure. If you do not have the time to tot up your savings yourself, you can also take a look at a simple budget calculator tool which is available to anyone with internet access. This breaks down all your potential monthly outgoings into categories, and makes all the necessary calculations to show you how much you stand to gain from taking control of your daily finances.
A spending outline that has everything you spend money on and stays within the acceptable income range is considered to be a good budget. It is also important to remember to include things like saving money for retirement, emergency expenses or schooling. Many people find budgeting a chore because they do not have direction or goals laid out as part of the budget. When you consider things like what you want to have in the next five years, for example, having paid off the car or mortgage, it makes it easier to sit down and take the time to budget with those goals in mind.
One of the most important questions you can ask yourself before securing a loan or making an investment is whether or not you are in a position to take on such financial responsibility. Many consumers consider taking out a loan or investing without first being honest with themselves regarding their existing finances - which could land them in financial trouble later on. So it is vital to consider all the aspects - from your current income to your current outgoings - before making a big decision like securing a loan or investing your money.